The Important of Business Networking Among Chinese Merchants and Traders

Many researches on business-to-business (B2B) networks point out that some merchants are unable to fulfill the market demand with their own resources. Hence, requiring them to establish and maintain good relationship with their suppliers such relationship is known as the B2B which is different from business-to-consumers (B2C). According to Morgan and Hunt (1994), B2B relationship refers to activities directed to establishing, and developing successful relations as well as growing the relationship among business partners. On the other hand, B2C refers to activities of businesses serving end consumers with products or services (Webster, 1992). The volume of B2B transactions is higher than the volume of B2C transactions. That is because B2B transactions involving raw materials while B2C is transaction between sales of the finished goods to the customer. This resulted in fierce competition within the B2B. To overcome this competition, network relationship is believed to be the "mechanism" that fuels the system to run fluidly.

Chinese business culture is characterized by high collectivism and power distance. Gounaris (1995) states that Chinese become more similar to the western concept of network. Davies et al. (1995) added that Chinese business relations developed through personal connections, and relationships via exchange of favors. According to Yamagishi (1994), western exchanges more relating in the kind of human nature. It may play an insufficient role in Chinese business networking. Chinese merchants seek more specific people to dealing in networks play a prominent role.

The important elements of B2B networks between Chinese business in the long-term orientation includes trust, commitment (Morgan and Hunt, 1994), emotional intensity (Gilliland and Bello, 2002), and communication (Dwyer et al., 1987; Ring and Van de Ven, 1994).

Wilson (1994) described that "fundamental relationship building block" is the degree of trust between businesses. Trust can be defined as the willingness to rely on an exchange partner in whom one has confidence. Besides that, trust also is an expectation about other part's honesty and benevolence. A point made by Bond and Hwang (1986), who argue that the most important factor for Chinese is interpersonal harmony and social order. According to Wang, Xiaohua, and YiZheng, the ideal resolution strategy for Chinese business people are more ‘humanistic' compare to ‘legalistic' approach. Therefore, trust can help to reduce anxiety and uncertainty by belief that one's partner is fulfills promised obligations.

Commitment also plays an important role in B2B networks.