The Exit Motivation of Small-Medium Sized Korean Manufacturing Exporters in a Foreign Market

The purpose of this study is to develop a model that depicts some crucial antecedents of relationship endings between exporters and importers across the border. Accordingly, this research model suggested the determinants of the relation end and path of termination process. Especially, this research identified the importance of voice (communication) types on the termination process First, this paper discussed the determinants of distribution relationship ending in the international context. The determinants were divided into transaction cost related factors and social exchange factors. Second, this research suggested the voice types as the mediator in the interaction phase. Therefore, the model presents what kind of voice type affects exit propensity. Third, the effect of moderating variables (relationship length and psychic distance) between voice type and exit propensity were suggested For the empirical test, the samples were randomly selected from 1650 manufacturing exporters which are registered with the KITA and KOCHAM. On the basis of MTI code, 9 industries were selected and then samples were collected by each industry rate. In order to test only for small-medium sized companies, companies with more than 300 employees were excluded. Finally, 398 samples (24.1%) were used for further analysis. To test the hypothesis, the structure equation model and path analysis were used. Warp PLS 1.0 (Partial Least Square) program was used for statistical analysis. According to the test result, trust and satisfaction are identified as important determinants to improve constructive voice in the export channel relationship. However, transaction cost variables, like switching cost and investment, were not significant factors to improve constructive voice in the export channel relationship. In addition, this research showed that a more constructive voice would decrease the possibility of exit in the channel relation. Finally, all moderators were identified as the significant variables.