Introduction: Sales of private labels(PU have been growing m recent years. Globally, PLs have already achieved 20% share, although between 25 and 50% share in most of the European markets(AC. Nielson, 2005). These products are aimed to have comparable quality and prices as national brand(NB) products and have been continuously eroding manufacturer's national brand market share. Stores have also started introducing premium PLs that are of higher-quality and more reasonably priced compared to NBs. Worldwide, many retailers already have a multiple-tier private label architecture. Consumers as a consequence are now able to have a more diverse brand choice in store than ever before. Since premium PLs are priced higher than regular PLs and even, in some cases, above NBs, stores can expect to generate higher profits. Brand extensions and private label have been extensively studied in the marketing field. However, less attention has been paid to the private label extension. Therefore, this research focuses on private label extension using the Multi-Attribute Attitude Model(Fishbein and Ajzen, 1975). Especially there are few studies that consider the hierarchical effect of the PL's two parent brands: store brand and the original PL. We assume that the attitude toward each of the two parent brands affects the attitude towards the extended PL. The influence from each parent brand toward extended PL will vary according to the perceived fit between each parent brand and the extended PL. This research focuses on how these two parent brands act as reference points to one another in the consumers' choice consideration. Specifically we seek to understand how store image and attitude towards original PL affect consumer perceptions of extended premium PL. How consumers perceive extended premium PLs could provide strategic suggestions for retailer managers with specific suggestions on whether it is more effective: to position extended premium PL similarly or dissimilarly to original PL especially on the quality dimension and congruency with store image. There is an extensive body of research on branding and brand extensions (e.g. Aaker and Keller, 1990) and more recently on PLs(e.g. Kumar and Steenkamp, 2007). However there are no studies to date that look at the upgrading and influence of original PLs and attitude towards store on the premium PL extension. This research wishes to make a contribution to this gap using the perceived fit difference between parent brands and extended premium PL as the context. In order to meet the above objectives, we investigate which factors heighten consumers' positive attitude toward premium PL extension. Research Model and Hypotheses: When considering the attitude towards the premium PL extension, we expect four factors to have an influence: attitude towards store; attitude towards original PL; perceived congruity between the store image and the premium PL; perceived similarity between the original PL and the premium PL. We expect that all these factors have an influence on consumer attitude towards premium PL extension. Figure 1 gives the research model and hypotheses. Method: Data were collected by an intercept survey conducted on consumers at discount stores. 403 survey responses were attained (total 59.8% female, across all age ranges). Respondents were asked to respond to a series of Questions measured on 7 point likert-type scales. The survey consisted of Questions that measured: the trust towards store and the original PL; the satisfaction towards store and the original PL; the attitudes towards store, the original PL, and the extended premium PL; the perceived similarity of the original PL and the extended premium PL; the perceived congruity between the store image and the extended premium PL. Product images with specific explanations of the features of premium PL, regular PL and NB we reused as the stimuli for the Question response. We developed scales to measure the research constructs. Cronbach's alphaw as measured each construct with the reliability for all constructs exceeding the .70 standard(Nunnally, 1978). Results: To test the hypotheses, path analysis was conducted using LISREL 8.30. The path analysis for verification of the model produced satisfactory results. The validity index shows acceptable results(${\chi}^2=427.00$(P=0.00), GFI= .90, AGFI= .87, NFI= .91, RMSEA= .062, RMR= .047). With the increasing retailer use of premium PLBs, the intention of this research was to examine how consumers use original PL and store image as reference points as to the attitude towards premium PL extension. Results(see table 1 & 2) show that the attitude of each parent brand (attitudes toward store and original pL) influences the attitude towards extended PL and their perceived fit moderates these influences. Attitude toward the extended PL was influenced by the relative level of perceived fit. Discussion of results and future direction: These results suggest that the future strategy for the PL extension needs to consider that positive parent brand attitude is more strongly associated with the attitude toward PL extensions. Specifically, to improve attitude towards PL extension, building and maintaining positive attitude towards original PL is necessary. Positioning premium PL congruently to store image is also important for positive attitude. In order to improve this research, the following alternatives should also be considered. To improve the research model's predictive power, more diverse products should be included in study. Other attributes of product should also be included such as design, brand name since we only considered trust and satisfaction as factors to build consumer attitudes.
Jangkei(狀啓) made to the Royal Court by Yi Sun-sin during the Japanese invasions of Korea is handed down under the names of Jangcho(狀草), Keicho(啓草), Keibon(啓本) and others depending on copying patterns of those times and later times as it was copied out by a third person. In particular, "YimjinJangcho(壬辰狀草)" which Yi drew up during his service as the director of the naval forces in Jeolla Jwasooyeong is known as the most popular Jangkei. "ChungMinKongKeicho" which has been re-located recently after loss is a national treasure level cultural property as valuable as "YimjinJangcho" and should be treated as a model of Yi Sun-sin's other Jangkeis by next generations. As of now, however it is not confirmed if it is a totally new book related to Yi Sun-sin or is supplementary to the lost Jangkei, this study decided to ascertain relevant information through a bibliographic discussion on the question. "Chungmin(忠愍)" was the title that was used after the death of Yi Sun-sin, and "ChungMinKongKeicho" was completed when Jangkei was copied in 1662. 12 books that would not be found in YimjinJangcho are included in the book and such books are also present in the Jangkei supplement which has been known lost so far. What should be especially focused on here is that the forms and contents of these (11) photographs that Japanese shot from "ChungMinKongKeicho" in 1928 turned out to be completely identical to those of the original copy. The point that Korean History Compilation Committee added the 12 books to Jangkei as referring to the book as "One Keicho(啓草) partially copied(抄寫) in separation" and that Cho Sung-do categorized the 12 books into a supplement and others can be solid proofs to make the Jangkei supplement called "ChungMinKongKeicho". In terms of "ChungMooKongKeicho", since it consists of 62 books in total, it is not reasonable to see the book as Jangkei supplement which has the extra 12 more books for itself. "ChungMooKongKeibon" in "ChungMooKongYusa" was written with a total of 16 books. In the body, Yidumun is only clearly present, and the three books in the later part are same with the original copy of "ChungMooKongKeicho". "YimjinJangcho" by Korean History Compilation Committee has been the only book in which Yidumun was observed so far but now, it is assumed that the publication date of "ChungMooKongKeibon" goes before that of the former. The counterargument to the opinion that "ChungMinKongKeicho" is the supplement to Jangkei is based on Lee Eun-sang's comment "One page of a log in the Jangkei copy supplement." At first Seol Ui-sik introduced a piece photo of the rough draft of "MoosulIlki" in a drawing form through "Nanjung Ilkicho by Yi Sun-sin" in 1953. Lee Eun-sang also added two pages of the handwritten Yilkicho in the Jangkeichobon supplement to "MoosulIlki" and for the second time, the phrase "One page of a log written during the last 10 days after the Jangkei copy supplement" and "Supplement" were used. Those views are originated from the comment "One photograph of the rough draft of "MoosulIlki"" which Seol Ui-sik introduced without knowledge of the exact source. Lee Eun-sang said, "One page of a log in the Jangkei copy supplement" because Lee mistook "ChungMooKongYusa" for a book related to Jangkei. Since it is the wrong argument different from the actual situation of the original copy, if it has to be corrected, it should be rephrased "One page of a log in ChungMooKongYusa." After all, the source of the counterargument is the mistake because there has never been the Jangkei supplement with one page of a log included. All the Jangkeis other than "YimjinJangcho" can be said as the Jangkei supplements but still, they are separated from the other Jangkeis for the extra 12 more books are present in the commonly-called Jangkei supplement. Due to that reason, the argument on how "ChungMinKongKeicho" with the 12 books added is the popular Jangkei supplement should be considered more reasonable.
Air transport today is a means of transport that is optimized for exchanges between nations. Around the world, has experienced an increase in operating and the number of airline route expansion that has entered into the international aviation agreements in order to take advantage of the air transport efficient, but the possibility of the occurrence of air transport accidents increased. When compared to the accident of other means of transport, development of air transport accidents, not high, but it leads to catastrophe aviation accident occurs. Air Transport accident many international transportation accident than domestic transportation accident, in the event of an accident, the analysis of the legal responsibility of the shipper or the like is necessary or passenger air carrier. Judgment of the legal order of discipline of air transport accident is a classification of the type of air transport agreement. Depending on the object, air transport agreements are classified into the contract of carriage of aviation of the air passenger transportation contract. For casualties occurs, air passenger transportation accident is a need more discussion of legal discipline for this particular. Korean Commercial Code, it is possible to reflect in accordance with the actual situation of South Korea the contents of the treaty, which is utilized worldwide in international air transport, even on the system, to control land, sea, air transport and welcoming to international standards. However, Korean Commercial Code, the problem of the Montreal Convention has occurred as it is primarily reflecting the Montreal Convention. As a cause of liability for damages, under the Commercial Code of Korea and the contents of the treaty precedent is reflected, the concept of accident is necessary definition of the exact concept for damages of passengers in particular. Cause of personal injury or death of passengers, in the event of an accident to the "working for the elevation" or "aircraft" on, the Montreal Convention is the mother method of Korea Commercial Code, liability for damages of air carrier defines. The Montreal Convention such, continue to be a matter of debate so far in connection with the scope of "working for the lifting of" the concepts defined in the same way from Warsaw Convention "accident". In addition, it is discussed and put to see if you can be included mental damage passenger suffered in air transport in the "personal injury" in the damage of the passenger is in the range of damages. If the operation of aircraft, injury accident, in certain circumstances, compensation for mental damage is possible, in the same way as serious injury, mental damage caused by aviation accidents not be able to live a normal life for the victim it is damage to make. So it is necessary to interpret and what is included in the injury to the body in Korea Commercial Code and related conventions, non-economic damage of passengers, clearly demonstrated from the point of view of prevention of abuse of litigation and reasonable protection of air carrier it must compensate only psychological damage that can be. Since the compensation of delay damages, Warsaw Convention, the Montreal Convention, Korea Commercial Code, there are provisions of the liability of the air carrier due to the delayed arrival of passenger and baggage, but you do not have a reference to delayed arrival, the concept of delay arrangement is necessary. The strict interpretation of the concept of delayed arrival, because it may interfere with safe operation of the air carrier, within the time agreed to the airport of arrival that is described in the aviation contract of carriage of passenger baggage, or, these agreements I think the absence is to be defined as when it is possible to consider this situation, requests the carrier in good faith is not Indian or arrive within a reasonable time is correct. The loss of passenger, according to the international passenger Conditions of Carriage of Korean Air, in addition to the cases prescribed by law and other treaties, loss of airline contracts, resulting in passengers from a service that Korean Air and air transport in question do damage was is, that the fact that Korean Air does not bear the responsibility as a general rule, that was caused by the negligence or intentional negligence of Korean Air is proof, negligence of passengers of the damage has not been interposed bear responsibility only when it is found. It is a clause in the case of damage that is not mandated by law or treaty, and responsible only if the negligence of the airline side has been demonstrated, but of the term negligence "for" intentional or negligent "Korean Air's Terms" I considered judgment of compatibility is required, and that gross negligence is appropriate. The "Korean Air international passenger Conditions of Carriage", airlines about the damage such as electronic equipment that is included in the checked baggage of passengers does not bear the responsibility, but the loss of baggage, international to arrive or depart the U.S. it is not the case of transportation. Therefore, it is intended to discriminate unfairly passengers of international flights arriving or departure to another country passengers of international flights arriving or departure, the United States, airlines will bear the responsibility for the goods in the same way as the contents of the treaty it should be revised in the direction.
1. Introduction Today Internet is recognized as an important way for the transaction of products and services. According to the data surveyed by the National Statistical Office, the on-line transaction in 2007 for a year, 15.7656 trillion, shows a 17.1%(2.3060 trillion won) increase over last year, of these, the amount of B2C has been increased 12.0%(10.2258 trillion won). Like this, because the entry barrier of on-line market of Korea is low, many retailers could easily enter into the market. So the bigger its scale is, but on the other hand, the tougher its competition is. Particularly due to the Internet and innovation of IT, the existing market has been changed into the perfect competitive market(Srinivasan, Rolph & Kishore, 2002). In the early years of on-line business, they think that the main reason for success is a moderate price, they are awakened to its importance of on-line service quality with tough competition. If it's not sure whether customers can be provided with what they want, they can use the Web sites, perhaps they can trust their products that had been already bought or not, they have a doubt its viability(Parasuraman, Zeithaml & Malhotra, 2005). Customers can directly reserve and issue their air tickets irrespective of place and time at the Web sites of travel agencies or airlines, but its empirical studies about these Web sites for reserving and issuing air tickets are insufficient. Therefore this study goes on for following specific objects. First object is to measure service quality and service recovery of Web sites for reserving and issuing air tickets. Second is to look into whether above on-line service quality and on-line service recovery have an impact on overall service quality. Third is to seek for the relation with overall service quality and customer satisfaction, then this customer satisfaction and loyalty intention. 2. Theoretical Background 2.1 On-line Service Quality Barnes & Vidgen(2000; 2001a; 2001b; 2002) had invented the tool to measure Web sites' quality four times(called WebQual). The WebQual 1.0, Step one invented a measuring item for information quality based on QFD, and this had been verified by students of UK business school. The Web Qual 2.0, Step two invented for interaction quality, and had been judged by customers of on-line bookshop. The WebQual 3.0, Step three invented by consolidating the WebQual 1.0 for information quality and the WebQual2.0 for interactionquality. It includes 3-quality-dimension, information quality, interaction quality, site design, and had been assessed and confirmed by auction sites(e-bay, Amazon, QXL). Furtheron, through the former empirical studies, the authors changed sites quality into usability by judging that usability is a concept how customers interact with or perceive Web sites and It is used widely for accessing Web sites. By this process, WebQual 4.0 was invented, and is consist of 3-quality-dimension; information quality, interaction quality, usability, 22 items. However, because WebQual 4.0 is focusing on technical part, it's usable at the Website's design part, on the other hand, it's not usable at the Web site's pleasant experience part. Parasuraman, Zeithaml & Malhorta(2002; 2005) had invented the measure for measuring on-line service quality in 2002 and 2005. The study in 2002 divided on-line service quality into 5 dimensions. But these were not well-organized, so there needed to be studied again totally. So Parasuraman, Zeithaml & Malhorta(2005) re-worked out the study about on-line service quality measure base on 2002's study and invented E-S-QUAL. After they invented preliminary measure for on-line service quality, they made up a question for customers who had purchased at amazon.com and walmart.com and reassessed this measure. And they perfected an invention of E-S-QUAL consists of 4 dimensions, 22 items of efficiency, system availability, fulfillment, privacy. Efficiency measures assess to sites and usability and others, system availability measures accurate technical function of sites and others, fulfillment measures promptness of delivering products and sufficient goods and others and privacy measures the degree of protection of data about their customers and so on. 2.2 Service Recovery Service industries tend to minimize the losses by coping with service failure promptly. This responses of service providers to service failure mean service recovery(Kelly & Davis, 1994). Bitner(1990) went on his study from customers' view about service providers' behavior for customers to recognize their satisfaction/dissatisfaction at service point. According to them, to manage service failure successfully, exact recognition of service problem, an apology, sufficient description about service failure and some tangible compensation are important. Parasuraman, Zeithaml & Malhorta(2005) approached the service recovery from how to measure, rather than how to manage, and moved to on-line market not to off-line, then invented E-RecS-QUAL which is a measuring tool about on-line service recovery. 2.3 Customer Satisfaction The definition of customer satisfaction can be divided into two points of view. First, they approached customer satisfaction from outcome of comsumer. Howard & Sheth(1969) defined satisfaction as 'a cognitive condition feeling being rewarded properly or improperly for their sacrifice.' and Westbrook & Reilly(1983) also defined customer satisfaction/dissatisfaction as 'a psychological reaction to the behavior pattern of shopping and purchasing, the display condition of retail store, outcome of purchased goods and service as well as whole market.' Second, they approached customer satisfaction from process. Engel & Blackwell(1982) defined satisfaction as 'an assessment of a consistency in chosen alternative proposal and their belief they had with them.' Tse & Wilton(1988) defined customer satisfaction as 'a customers' reaction to discordance between advance expectation and ex post facto outcome.' That is, this point of view that customer satisfaction is process is the important factor that comparing and assessing process what they expect and outcome of consumer. Unlike outcome-oriented approach, process-oriented approach has many advantages. As process-oriented approach deals with customers' whole expenditure experience, it checks up main process by measuring one by one each factor which is essential role at each step. And this approach enables us to check perceptual/psychological process formed customer satisfaction. Because of these advantages, now many studies are adopting this process-oriented approach(Yi, 1995). 2.4 Loyalty Intention Loyalty has been studied by dividing into behavioral approaches, attitudinal approaches and complex approaches(Dekimpe et al., 1997). In the early years of study, they defined loyalty focusing on behavioral concept, behavioral approaches regard customer loyalty as "a tendency to purchase periodically within a certain period of time at specific retail store." But the loyalty of behavioral approaches focuses on only outcome of customer behavior, so there are someone to point the limits that customers' decision-making situation or process were neglected(Enis & Paul, 1970; Raj, 1982; Lee, 2002). So the attitudinal approaches were suggested. The attitudinal approaches consider loyalty contains all the cognitive, emotional, voluntary factors(Oliver, 1997), define the customer loyalty as "friendly behaviors for specific retail stores." However these attitudinal approaches can explain that how the customer loyalty form and change, but cannot say positively whether it is moved to real purchasing in the future or not. This is a kind of shortcoming(Oh, 1995). 3. Research Design 3.1 Research Model Based on the objects of this study, the research model derived is
. 3.2 Hypotheses 3.2.1 The Hypothesis of On-line Service Quality and Overall Service Quality The relation between on-line service quality and overall service quality I-1. Efficiency of on-line service quality may have a significant effect on overall service quality. I-2. System availability of on-line service quality may have a significant effect on overall service quality. I-3. Fulfillment of on-line service quality may have a significant effect on overall service quality. I-4. Privacy of on-line service quality may have a significant effect on overall service quality. 3.2.2 The Hypothesis of On-line Service Recovery and Overall Service Quality The relation between on-line service recovery and overall service quality II-1. Responsiveness of on-line service recovery may have a significant effect on overall service quality. II-2. Compensation of on-line service recovery may have a significant effect on overall service quality. II-3. Contact of on-line service recovery may have a significant effect on overall service quality. 3.2.3 The Hypothesis of Overall Service Quality and Customer Satisfaction The relation between overall service quality and customer satisfaction III-1. Overall service quality may have a significant effect on customer satisfaction. 3.2.4 The Hypothesis of Customer Satisfaction and Loyalty Intention The relation between customer satisfaction and loyalty intention IV-1. Customer satisfaction may have a significant effect on loyalty intention. 3.2.5 The Hypothesis of a Mediation Variable Wolfinbarger & Gilly(2003) and Parasuraman, Zeithaml & Malhotra(2005) had made clear that each dimension of service quality has a significant effect on overall service quality. Add to this, the authors analyzed empirically that each dimension of on-line service quality has a positive effect on customer satisfaction. With that viewpoint, this study would examine if overall service quality mediates between on-line service quality and each dimension of customer satisfaction, keeping on looking into the relation between on-line service quality and overall service quality, overall service quality and customer satisfaction. And as this study understands that each dimension of on-line service recovery also has an effect on overall service quality, this would examine if overall service quality also mediates between on-line service recovery and each dimension of customer satisfaction. Therefore these hypotheses followed are set up to examine if overall service quality plays its role as the mediation variable. The relation between on-line service quality and customer satisfaction V-1. Overall service quality may mediate the effects of efficiency of on-line service quality on customer satisfaction. V-2. Overall service quality may mediate the effects of system availability of on-line service quality on customer satisfaction. V-3. Overall service quality may mediate the effects of fulfillment of on-line service quality on customer satisfaction. V-4. Overall service quality may mediate the effects of privacy of on-line service quality on customer satisfaction. The relation between on-line service recovery and customer satisfaction VI-1. Overall service quality may mediate the effects of responsiveness of on-line service recovery on customer satisfaction. VI-2. Overall service quality may mediate the effects of compensation of on-line service recovery on customer satisfaction. VI-3. Overall service quality may mediate the effects of contact of on-line service recovery on customer satisfaction. 4. Empirical Analysis 4.1 Research design and the characters of data This empirical study aimed at customers who ever purchased air ticket at the Web sites for reservation and issue. Total 430 questionnaires were distributed, and 400 were collected. After surveying with the final questionnaire, the frequency test was performed about variables of sex, age which is demographic factors for analyzing general characters of sample data. Sex of data is consist of 146 of male(42.7%) and 196 of female(57.3%), so portion of female is a little higher. Age is composed of 11 of 10s(3.2%), 199 of 20s(58.2%), 105 of 30s(30.7%), 22 of 40s(6.4%), 5 of 50s(1.5%). The reason that portions of 20s and 30s are higher can be supposed that they use the Internet frequently and purchase air ticket directly. 4.2 Assessment of measuring scales This study used the internal consistency analysis to measure reliability, and then used the Cronbach'$\alpha$ to assess this. As a result of reliability test, Cronbach'$\alpha$ value of every component shows more than 0.6, it is found that reliance of the measured variables are ensured. After reliability test, the explorative factor analysis was performed. the factor sampling was performed by the Principal Component Analysis(PCA), the factor rotation was performed by the Varimax which is good for verifying mutual independence between factors. By the result of the initial factor analysis, items blocking construct validity were removed, and the result of the final factor analysis performed for verifying construct validity is followed above. 4.3 Hypothesis Testing 4.3.1 Hypothesis Testing by the Regression Analysis(SPSS) 4.3.2 Analysis of Mediation Effect To verify mediation effect of overall service quality of and , this study used the phased analysis method proposed by Baron & Kenny(1986) generally used. As
shows, Step 1 and Step 2 are significant, and mediation variable has a significant effect on dependent variables and so does independent variables at Step 3, too. And there needs to prove the partial mediation effect, independent variable's estimate ability at Step 3(Standardized coefficient $\beta$eta : efficiency=.164, system availability=.074, fulfillment=.108, privacy=.107) is smaller than its estimate ability at Step 2(Standardized coefficient $\beta$eta : efficiency=.409, system availability=.227, fulfillment=.386, privacy=.237), so it was proved that overall service quality played a role as the partial mediation between on-line service quality and satisfaction. As
shows, Step 1 and Step 2 are significant, and mediation variable has a significant effect on dependent variables and so does independent variables at Step 3, too. And there needs to prove the partial mediation effect, independent variable's estimate ability at Step 3(Standardized coefficient $\beta$eta : responsiveness=.164, compensation=.117, contact=.113) is smaller than its estimate ability at Step 2(Standardized coefficient $\beta$eta : responsiveness=.409, compensation=.386, contact=.237), so it was proved that overall service quality played a role as the partial mediation between on-line service recovery and satisfaction. Verified results on the basis of empirical analysis are followed. First, as the result of , it shows that all were chosen, so on-line service quality has a positive effect on overall service quality. Especially fulfillment of overall service quality has the most effect, and then efficiency, system availability, privacy in order. Second, as the result of , it shows that all were chosen, so on-line service recovery has a positive effect on overall service quality. Especially responsiveness of overall service quality has the most effect, and then contact, compensation in order. Third, as the result of and , it shows that and all were chosen, so overall service quality has a positive effect on customer satisfaction, customer satisfaction has a positive effect on loyalty intention. Fourth, as the result of and , it shows that and all were chosen, so overall service quality plays a role as the partial mediation between on-line service quality and customer satisfaction, on-line service recovery and customer satisfaction. 5. Conclusion This study measured and analyzed service quality and service recovery of the Web sites that customers made a reservation and issued their air tickets, and by improving customer satisfaction through the result, this study put its final goal to grope how to keep loyalty customers. On the basis of the result of empirical analysis, suggestion points of this study are followed. First, this study regarded E-S-QUAL that measures on-line service quality and E-RecS-QUAL that measures on-line service recovery as variables, so it overcame the limit of existing studies that used modified SERVQUAL to measure service quality of the Web sites. Second, it shows that fulfillment and efficiency of on-line service quality have the most significant effect on overall service quality. Therefore the Web sites of reserving and issuing air tickets should try harder to elevate efficiency and fulfillment. Third, privacy of on-line service quality has the least significant effect on overall service quality, but this may be caused by un-assurance of customers whether the Web sites protect safely their confidential information or not. So they need to notify customers of this fact clearly. Fourth, there are many cases that customers don't recognize the importance of on-line service recovery, but if they would think that On-line service recovery has an effect on customer satisfaction and loyalty intention, as its importance is very significant they should prepare for that. Fifth, because overall service quality has a positive effect on customer satisfaction and loyalty intention, they should try harder to elevate service quality and service recovery of the Web sites of reserving and issuing air tickets to maximize customer satisfaction and to secure loyalty customers. Sixth, it is found that overall service quality plays a role as the partial mediation, but now there are rarely existing studies about this, so there need to be more studies about this.
Trust has been studied extensively in psychology, economics, and sociology, and its importance has been emphasized not only in marketing, but also in business disciplines in general. Unlike past relationships between suppliers and buyers, which take considerable advantage of private networks and may involve unethical business practices, partnerships between suppliers and buyers are at the core of success for industrial marketing amid intense global competition in the 21st century. A high level of mutual cooperation occurs through an exchange relationship based on trust, which brings long-term benefits, competitive enhancements, and transaction cost reductions, among other benefits, for both buyers and suppliers. In spite of the important role of trust, existing studies in buy-supply situations overlook the role of trust and do not systematically analyze the effect of trust on relational performance. Consequently, an in-depth study that determines the relation of trust to the relational performance between buyers and suppliers of business services is absolutely needed. Business services in this study, which include those supporting the manufacturing industry, are drawing attention as the economic growth engine for the next generation. The Korean government has selected business services as a strategic area for the development of manufacturing sectors. Since the demands for opening business services markets are becoming fiercer, the competitiveness of the business service industry must be promoted now more than ever. The purpose of this study is to investigate the effect of the mutual trust between buyers and suppliers on relational performance. Specifically, this study proposed a theoretical model of trust-relational performance in the transactions of business services and empirically tested the hypotheses delineated from the framework. The study suggests strategic implications based on research findings. Empirical data were collected via multiple methods, including via telephone, mail, and in-person interviews. Sample companies were knowledge-based companies supplying and purchasing business services in Korea. The present study collected data on a dyadic basis. Each pair of sample companies includes a buying company and its corresponding supplying company. Mutual trust was traced for each pair of companies. This study proposes a model of trust-relational performance of buying-supplying for business services. The model consists of trust and its antecedents and consequences. The trust of buyers is classified into trust toward the supplying company and trust toward salespersons. Viewing trust both at the individual level and the organizational level is based on the research of Doney and Cannon (1997). Normally, buyers are the subject of trust, but this study supposes that suppliers are the subjects. Hence, it uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers, like buyers, are the subject of trust since transactions are normally bilateral. From this point of view, suppliers' trust in buyers is as important as buyers' trust in suppliers. The suppliers' trust is influenced by the extent to which it trusts the buying companies and the buyers. This classification of trust using an individual level and an organization level is based on the suggestion of Doney and Cannon (1997). Trust affects the process of supplier selection, which works in a bilateral manner. Suppliers are actively involved in the supplier selection process, working very closely with buyers. In addition, the process is affected by the extent to which each party trusts its partners. The selection process consists of certain steps: recognition, information search, supplier selection, and performance evaluation. As a result of the process, both buyers and suppliers evaluate the performance and take corrective actions on the basis of such outcomes as tangible, intangible, and/or side effects. The measurement of trust used for the present study was developed on the basis of the studies of Mayer, Davis and Schoorman (1995) and Mayer and Davis (1999). Based on their recommendations, the three dimensions of trust used for the study include ability, benevolence, and integrity. The original questions were adjusted to the context of the transactions of business services. For example, a question such as "He/she has professional capabilities" has been changed to "The salesperson showed professional capabilities while we talked about our products." The measurement used for this study differs from those used in previous studies (Rotter 1967; Sullivan and Peterson 1982; Dwyer and Oh 1987). The measurements of the antecedents and consequences of trust used for this study were developed on the basis of Doney and Cannon (1997). The original questions were adjusted to the context of transactions in business services. In particular, questions were developed for both buyers and suppliers to address the following factors: reputation (integrity, customer care, good-will), market standing (company size, market share, positioning in the industry), willingness to customize (product, process, delivery), information sharing (proprietary information, private information), willingness to maintain relationships, perceived professionalism, authority empowerment, buyer-seller similarity, and contact frequency. As a consequential variable of trust, relational performance was measured. Relational performance is classified into tangible effects, intangible effects, and side effects. Tangible effects include financial performance; intangible effects include improvements in relations, network developing, and internal employee satisfaction; side effects include those not included either in the tangible or intangible effects. Three hundred fifty pairs of companies were contacted, and one hundred five pairs of companies responded. After deleting five company pairs because of incomplete responses, one hundred five pairs of companies were used for data analysis. The response ratio of the companies used for data analysis is 30% (105/350), which is above the average response ratio in industrial marketing research. As for the characteristics of the respondent companies, the majority of the companies operate service businesses for both buyers (85.4%) and suppliers (81.8%). The majority of buyers (76%) deal with consumer goods, while the majority of suppliers (70%) deal with industrial goods. This may imply that buyers process the incoming material, parts, and components to produce the finished consumer goods. As indicated by their report of the length of acquaintance with their partners, suppliers appear to have longer business relationships than do buyers. Hypothesis 1 tested the effects of buyer-supplier characteristics on trust. The salesperson's professionalism (t=2.070, p<0.05) and authority empowerment (t=2.328, p<0.05) positively affected buyers' trust toward suppliers. On the other hand, authority empowerment (t=2.192, p<0.05) positively affected supplier trust toward buyers. For both buyers and suppliers, the degree of authority empowerment plays a crucial role in the maintenance of their trust in each other. Hypothesis 2 tested the effects of buyerseller relational characteristics on trust. Buyers tend to trust suppliers, as suppliers make every effort to contact buyers (t=2.212, p<0.05). This tendency has also been shown to be much stronger for suppliers (t=2.591, p<0.01). On the other hand suppliers trust buyers because suppliers perceive buyers as being similar to themselves (t=2.702, p<0.01). This finding confirmed the results of Crosby, Evans, and Cowles (1990), which reported that suppliers and buyers build relationships through regular meetings, either for business or personal matters. Hypothesis 3 tested the effects of trust on perceived risk. It has been found that for both suppliers and buyers the lower is the trust, the higher is the perceived risk (t=-6.621, p<0.01 for buyers; t=-2.437, p<0.05). Interestingly, this tendency has been shown to be much stronger for buyers than for suppliers. One possible explanation for this higher level of perceived risk is that buyers normally perceive higher risks than do suppliers in transactions involving business services. For this reason, it is necessary for suppliers to implement risk reduction strategies for buyers. Hypothesis 4 tested the effects of trust on information searching. It has been found that for both suppliers and buyers, contrary to expectation, trust depends on their partner's reputation (t=2.929, p<0.01 for buyers; t=2.711, p<0.05 for suppliers). This finding shows that suppliers with good reputations tend to be trusted. Prior experience did not show any significant relationship with trust for either buyers or suppliers. Hypothesis 5 tested the effects of trust on supplier/buyer selection. Unlike buyers, suppliers tend to trust buyers when they think that previous transactions with buyers were important (t=2.913 p<0.01). However, this study did not show any significant relationship between source loyalty and the trust of buyers in suppliers. Hypothesis 6 tested the effects of trust on relational performances. For buyers and suppliers, financial performance reportedly improved when they trusted their partners (t=2.301, p<0.05 for buyers; t=3.692, p<0.01 for suppliers). It is interesting that this tendency was much stronger for suppliers than it was for buyers. Similarly, competitiveness was reported to improve when buyers and suppliers trusted their partners (t=3.563, p<0.01 for buyers; t=3.042, p<0.01 for suppliers). For suppliers, efficiency and productivity were reportedly improved when they trusted buyers (t=2.673, p<0.01). Other performance indices showed insignificant relationships with trust. The findings of this study have some strategic implications. First and most importantly, trust-based transactions are beneficial for both suppliers and buyers. As verified in the study, financial performance can be improved through efforts to build and maintain mutual trust. Similarly, competitiveness can be increased through the same kinds of effort. Second, trust-based transactions can facilitate the reduction of perceived risks inherent in the purchasing situation. This finding has implications for both suppliers and buyers. It is generally believed that buyers perceive higher risks in a highly involved purchasing situation. To reduce risks, previous studies have recommended that suppliers devise risk-reducing tactics. Moving beyond these recommendations, the present study uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers are also susceptible to perceived risks, especially when they supply services that require very technical and sophisticated manipulations and maintenance. Consequently, buyers and suppliers must solve problems together in close collaboration. Hence, mutual trust plays a crucial role in the problem-solving process. Third, as found in this study, the more authority a salesperson has, the more he or she can be trusted. This finding is very important with regard to tactics. Building trust is a long-term assignment; however, when mutual trust has not been developed, suppliers can overcome the problems they encounter by empowering a salesperson with the authority to make certain decisions. This finding applies to suppliers as well.
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