Fairness and Relationship Quality Perceived by Local Suppliers

Abstract This study compares the perception of local suppliers on fairness and relationship quality towards the top five hyper-market retailers in Korea. The study specifically addresses the factors leading to the relatively poor performance of Wal-Mart and Carrefour in Korea. Results show that the business model of Tesco based on joint-venturing with a local partner proves more successful than that of Wal-Mart or Carrefour based on expatriate CEO leadership. Causal relationship analysis on these measures reveals that procedural fairness exerts most influence on the commitment level of local suppliers in a channel relationship.