Demand-Supply Matching and Marketing Strategies by Japanese Electronic Producers in Russia

This paper examines the roles taken by the new-emerging Russian distributors and dealers after Russia liberalized imports in 1991. Prior to the initiation of import liberalization in 1991, Russian citizens could not buy high quality goods at reasonable prices. Store locations, shopping hours, and quantities available to consumers all tended to be inconvenient. In short, Russia lacked the function of demand-supply matching. A legal change initiated by the Russian president on November 15, 1991 allowed liberalization of foreign economic activities and the emergence of 12,000 Russian trading companies (distributors and dealers). They began to import Japanese automobiles, copy machines, and electrical appliances from Japanese owned factories in Europe and East-Asian countries via Finland. Japanese producers expected them to provide the following functions: l) sell goods; 2) pass goods through customs and obtain lower import duties; 3) stable financial conditions; 4) offer highly technical support; 5) distribute goods to the regions; 6) provide useful information and feedback to producers. In 1990, Russia lacked marketing information, customer service, and technology. In this environment, Japanese producers took a two-step marketing channel strategy through distributors and dealers. Such a strategy reduced the necessary capital investment and transaction costs. The biggest problem in the Russian market -the lack of demand-supply matching -has almost been overcome, because Russian distributors and dealers distributed technically superior Japanese goods to nearly all Russian regions. New-emerging Russian distributors and dealers have come to play a valuable role