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Replacing the Foreign Intermediary

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  • Bent Petersen
  • Gabriel R. G. Benito
  • Torben Pedersen

Abstract

What factors impel exporters to replace a foreign intermediary (i.e., agents or distributors), and what factors impede such actions? Dissatisfaction with the current intermediary is the explanation typically given for why intermediaries are replaced, but other factors may also influence the likelihood of such a change. Using longitudinal data from a sample of Danish exporters, we apply logistic regression analysis to model the impact of a number of factors. Our data show that dissatisfaction with the local intermediary does not appear as a determinant of replacement. Instead, changes in the level of information asymmetry exert the most important influence on the decision to replace the foreign intermediary. As an exporter becomes more informed about alternative—and potentially more qualified—intermediaries operating in a particular market, the existing intermediary faces a higher risk of being replaced. The study also shows that switching costs are important impediments to change of intermediaries.

Suggested Citation

  • Bent Petersen & Gabriel R. G. Benito & Torben Pedersen, 2000. "Replacing the Foreign Intermediary," International Studies of Management & Organization, Taylor & Francis Journals, vol. 30(1), pages 45-62, March.
    • Handle: RePEc:taf:mimoxx:v:30:y:2000:i:1:p:45-62
    DOI: 10.1080/00208825.2000.11656782
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    Citations

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    Cited by:

    1. Gabriel R.G. Benito & Torben Pedersen & Bent Petersen, 2005. "Export channel dynamics: an empirical investigation," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(3), pages 159-173.
    2. Aykol, Bilge & Leonidou, Leonidas C., 2018. "Exporter-importer business relationships: Past empirical research and future directions," International Business Review, Elsevier, vol. 27(5), pages 1007-1021.
    3. Ellis, Paul D., 2005. "The traders' dilemma: The adverse consequences of superior performance in mediated exchanges," International Business Review, Elsevier, vol. 14(4), pages 375-396, August.
    4. Petersen, Bent & Pedersen, Torben & Sharma, Deo, 2001. "The Role of Knowledge in Firms’ internationalization Process: Wherefrom and Whereto," Working Papers 17-2001, Copenhagen Business School, Department of International Economics and Management.
    5. Solberg, Carl Arthur & Nes, Erik B., 2002. "Exporter trust, commitment and marketing control in integrated and independent export channels," International Business Review, Elsevier, vol. 11(4), pages 385-405, August.
    6. Benito, Gabriel R.G. & Pedersen, Torben & Petersen, Bent, 1999. "Export Channel Dynamics: An Empirical Analysis of Changes in the Organization of Foreign Distribution," Working Papers 7-2000, Copenhagen Business School, Department of International Economics and Management.
    7. Pedersen, T. & Petersen, B. & Benito, G. R. G., 2002. "Change of foreign operation method: impetus and switching costs," International Business Review, Elsevier, vol. 11(3), pages 325-345, June.

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