The impact of guanxi, xinyong and buyer collaboration on the loyalty and financial performance of vegetable farmers in China

Abstract

Purpose – The purpose of this paper is to examine the impact of two Chinese cultural constructs, guanxi (networks) and xinyong (interpersonal trust) in the burgeoning vegetable supply chains. Design/methodology/approach – Data were collected using a validated survey instrument and 520 usable responses were obtained from vegetable farmers in three main vegetable producing provinces of China. Findings – The findings revealed that farmers' guanxi promotes xinyong and collaboration of buyers. It was also determined that xinyong is the key mediator between guanxi and the two outcomes, loyalty and financial performance of farmers. Additionally, xinyong influences collaboration of the buyer. Research limitations/implications – This paper offers strategic insights into both academicians and practitioners associated with the vegetable industry regarding enhancement of inter-organisational relationships (loyalty) and financial performance of farmers in China through the embedded concepts of guanxi and xinyong. Originality/value – Despite its potential importance, relatively little is known about these two concepts especially with respect to supply chains of fresh produce.