6. Discussion and implications
Extending previous debate on how localization requires international businesses to better understand and adapt to the local cultural values and norms (Czinkota & Ronkainen, 1998; Ferle, Edwards, & Lee, 2008; Roth, 1995), this study makes the first attempt to theoretically argue that cultural-specific relational notions should be considered as tools of localization to facilitate successful b2b relationships in foreign markets. Bridging the stream of guanxi literature to study localization in China, this paper empirically examines how the cultural-specific notion of guanxi and its sub-dimensions moderate that effect of relationship constructs on financial performance and long-term orientation. Empirical data collected from Chinese buyers regarding their Sino– US business relationships confirms guanxi's significance as a localization tool in two ways. Firstly, whilst guanxi significantly replaces the positive impact of trust on financial performance, the finding advises that in the Chinese context, guanxi between sales representatives and procurement managers at a personal level also substitutes the requirement of organizational trust that is needed for achieving better financial performance, explaining why guanxi can replace the need of having a contract in the Chinese perspective (Yen et al., 2007). Secondly, when guanxi significantly weakens the negative impact of uncertainty on long-term orientation, the outcome suggests that guanxi provides a safeguard to maintain relationship longevity, counterbalancing the negative impact of uncertainty (Jorgensen & Petelle, 1992).