مدیریت بازرگانی (Sep 2020)
Investigating the Effectiveness of Characteristics of Exporting Companies, Characteristics of Export Transactions and Experience in Trade Claims through the Intermediary Variables of Trade Risk Management on Export Performance (Case Study: Pharmaceutical Exporting Companies in Iran)
Abstract
Objective Export is considered as the driving force of economic growth for each country. Hence, identifying the effective factors of export performance is one of the most important measures for export success. Companies might encounter a variety of risks and uncertainties in international trade transactions much bigger than domestic trade which affect their performance during their international transactions. As a result, it generates additional transaction costs. Therefore, companies should take appropriate actions in order to face such risks. International trade is a form of international transaction that generates corporate profits through imports and exports. Because it is difficult to consider the environments of both exporting and importing companies, the researchers will just focus on exports and exporting companies in this research. The purpose of this study is to investigate the effect of characteristics of exporting companies, characteristics of export transactions and experience in trade claims through mediating role of trade risk management on export performance and to analyze the effects of characteristics of exporting companies, characteristics of export transaction and experience in trade claims on export performance in pharmaceutical exporting companies in Iran. Methodology The present survey study is applied in nature and descriptive in terms of purpose. The statistical population of the study consists of 48 pharmaceutical exporting companies in Iran. Joe and Pack’s (2017) questionnaire was used to collect the data; the content validity of the questionnaire was confirmed by the experts and it was localized afterwards. Besides, the convergence validity of the questionnaire was also confirmed using statistical methods. In addition, Cronbach’s alpha coefficient was calculated for the reliability of the questionnaire. The research hypotheses were tested using structural equation modeling in SPSS version 25 and SmartPls3 software. Findings The results showed that the characteristics of exporting companies, characteristics of export transactions and experience in trade claims have a direct and indirect significantly positive effect on export performance through the mediating variable of trade risk management. Moreover, the impact of trade risk management on export performance was positive and significant. Conclusion The characteristics of exporting companies have a significantly positive effect on export performance. Large companies can have high export performance due to the high division of labor in the organization and specialization. The characteristics of exporting companies have a significantly positive effect on trade risk management as well. Therefore, the second hypothesis of the research was confirmed. In fact, the larger the organization and the more experienced it is in exporting, the more likely it is to identify risks and react to them in a timely manner. Trade risk management has a significantly positive effect on export performance. Export performance can be expected to increase with the application of business risk management. The characteristics of exporting companies have a positive and significant effect on export performance through the mediating variable of trade risk management. In addition, characteristics of export transactions have a positive and significant effect on export performance. If the shipping methods are tailored to the type of goods as well as the distance and delivery time, the payment methods based on the factors such as economic and political conditions of the trading country, it is then expected to observe improvement in export performance. The characteristics of export transactions have a significantly positive effect on trade risk management. It is suggested that exporting companies choose appropriate transportation methods according to the type of export goods and time interval, and also consider the conditions to prevent failure or late receipt of transaction amounts in the international purchase and sale contract. Characteristics of export transactions have a positive and significant effect on export performance through the mediating role of trade risk management. To prevent failure in receipt of transaction funds, the use of export credit as a tool for trade risk management has a positive effect on export performance. Experience in trade claims has a significantly positive effect on export performance. If companies have experienced trade claims and disputes in international trade in the past, they can prevent such disputes from recurring with greater insight and awareness. Experience in trade claims has a significantly positive effect on trade risk management. In fact, the more business claims a company has, the higher their level of understanding of trade risks. It will, in turn, affect the trade risk management practices used by the company. Experience in trade claims has a positive and significant effect on export performance through the mediating variable of trade risk management. Therefore, if the company has experienced business disputes and lawsuits during its operation, it has the opportunity to timely identify potential and actual trade risks that could lead to disputes and take the necessary measures accordingly.
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