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Effect of exporter’s incentives on foreign distributor’s role performance

Author

Listed:
  • Claude Obadia

    (ESCE, International Business School, Paris, France)

  • Daniel C Bello

    (Institute of International Business, J. Mack Robinson College of Business, Georgia State University, Atlanta, USA)

  • David I Gilliland

    (College of Business, Colorado State University, Fort Collins, USA)

Abstract

A foreign distributor’s motivation to perform local marketing tasks for an exporter is often poor due to agency conflicts and transaction cost constraints characterizing the export channel. While exporters may engage in actions such as offering incentives and overseeing partner activities to improve foreign marketing, such intrusions into partner operations often fail to enhance the distributor’s role performance. Drawing on motivation theory, the authors develop a model explaining the efficiency of different incentive types in enhancing the distributor’s motivational context to act on behalf of the exporter, thereby improving relationship quality, distributor relationship-specific investments, and, consequently, distributor role performance. The authors use a sample of 278 European exporters to test hypotheses regarding relationship factors that mediate and moderate the incentive–role performance relationship. The results indicate that the impact of low-powered incentives (LPIs) substitutes for the effect of high-powered incentives on relationship quality and specific investments, the key mediators driving distributor role performance. In addition, exporter oversight of distributor activities weakens the effectiveness of LPIs to increase distributor-specific investment. The authors derive implications for designing portfolios of incentives, with inferences based on efficiently matching incentive-induced motivational context with foreign distributor’s actions required to accomplish exporter goals.

Suggested Citation

  • Claude Obadia & Daniel C Bello & David I Gilliland, 2015. "Effect of exporter’s incentives on foreign distributor’s role performance," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 46(8), pages 960-983, October.
    • Handle: RePEc:pal:jintbs:v:46:y:2015:i:8:p:960-983
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    Citations

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    Cited by:

    1. Ghasem Zaefarian & Matthew J. Robson & Zhaleh Najafi-Tavani & Stavroula Spyropoulou, 2023. "Relationships of stressors and opportunism in cross-border exchange partnership contexts: When and how monitoring matters," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 54(3), pages 441-475, April.
    2. Obadia, Claude & Bello, Daniel C., 2019. "How to select an export mode without bias," Business Horizons, Elsevier, vol. 62(2), pages 171-183.
    3. Chen Qian & Stefan Seuring & Ralf Wagner, 2021. "Reviewing interfirm relationship quality from a supply chain management perspective," Management Review Quarterly, Springer, vol. 71(3), pages 625-650, July.
    4. Claude Obadia & Matthew J. Robson, 2021. "The two sides of cooperation in export relationships: When more is not better," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(8), pages 1616-1627, October.
    5. Hultman, Magnus & Oghazi, Pejvak, 2024. "On the (in)effectiveness of standardized versus adapted international promotion strategies: Evidence from entrepreneurial firms," Journal of Business Research, Elsevier, vol. 170(C).
    6. David I. Gilliland, 2023. "A multi-system organizing framework for inter-firm control: a comprehensive perspective on control," Journal of the Academy of Marketing Science, Springer, vol. 51(1), pages 66-85, January.
    7. Selma Kadic-Maglajlic & Claude Obadia & Irena Vida & Matthew J. Robson, 2023. "Moral Categorization of Opportunists in Cross-Border Interfirm Relationships," Journal of Business Ethics, Springer, vol. 188(2), pages 221-238, November.
    8. Liu, Steven Y.H. & Deligonul, Seyda & Cavusgil, S. Tamer & Chiou, Jyh-Shen, 2021. "Addressing psychic distance and learning in international buyer-seller relationships: The role of firm exploration and asset specificity," Journal of World Business, Elsevier, vol. 56(4).
    9. Obadia, Claude & Vida, Irena, 2024. "Export marketing strategy and performance: A focus on SMEs promotion," International Business Review, Elsevier, vol. 33(2).
    10. Kantaruk Pierre, Oksana & Descotes, Raluca Mogos & Pla-Barber, José, 2024. "Exploring relational norms in exporter-importer product innovation co-development: A qualitative study," International Business Review, Elsevier, vol. 33(1).
    11. Pornlapas Suwannarat, 2021. "The Performance of an Importer in Mediating the Influence of Export Incentives on the Performance of an Exporter," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(2), pages 293-309.
    12. Liu, Yen-Hung Steven & Deligonul, Seyda & Cavusgil, Erin & Chiou, Jyh-Shen, 2018. "Always trust in old friends? Effects of reciprocity in bilateral asset specificity on trust in international B2B partnerships," Journal of Business Research, Elsevier, vol. 90(C), pages 171-185.
    13. Bianchi, Constanza & Abu Saleh, Md., 2020. "Investigating SME importer–foreign supplier relationship trust and commitment," Journal of Business Research, Elsevier, vol. 119(C), pages 572-584.

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