Impact Of Market And Non-market Strategy On Performance Of Foreign Retailers

Now china is on the process from Transition Economy to Market Economy. On thisprocess, the China Goveronment is playing a important role in allocating resources by meansof regulating and making policies, which, to some extend, will influent on multinationalenterprises’development in China. Retailing was fiercely intervented by policies. Whenforeign retailers first stepped into China, they had to set up join ventures. This consequencesis caused by market segment after analyzing the obstacles foreign retailers faced up to.Geranally speaking, there are two stages when foreign ratailers step into host country.The first stage is the entry stage. When foreign retailers stepped into host country, they werefaced with bargaining with the host country government. The bargainging power of foreignretailers would influent performance through setting up strategic alliance. The second stage isthe managing stage which foreign retailers would be exposed to market competition. Themarket and non-market actions foreign retailers took would eventually influence onperforment.This paper is based on bargaining power perspective and resource-based theory. Bytaking case study method of Carrefour, Wal-mart and Jusco, this paper tries to answer twoquestions. The fist one is how to increase bargaining power of foreign retailers by takingmarket and non-market actions in the context of Transition Economy and Market Economy.The second one is how to reach to satisfactory performent by taking market and non-marketactions in the managing stage.Finally, this paper comes to three conclusions. The first one is no matter in which stage,government behavior will influence foreign retailers’ competitive actions. The non-marketfactors are playing a tremendous role in foreign retailers’ development in China. The secondone is the understating of China government of foreign retailers will influence the performent.The third one is foreign retailers will take different market and non-market actions because ofdifferent culture.