With formal trade barriers in Japan virtually eliminated, attention has turned to the structural or non-tariff barriers that might help explain persistent trade deficits with Japan that the US and many other countries have experienced. In this study, the first empirical examination of its kind, we analyze how the Japanese distribution system serves as a structural barrier to entry. To do so, we surveyed Japanese supermarket buyers about the individual and relative importance of five key factors in their choice of suppliers. In addition, we used similar data from a previous study of retail buyers in the United States to develop the first cross-cultural comparison of retailer decision-making. Important differences in the nature and conduct of business relationships in the two countries suggest several ways that US sellers - and indeed, all foreign sellers - might address the disadvantages they face in the Japanese market.
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