...University of Nottingham Ningbo China Business School Academic Year 2015/16 Autumn Semester INTERNATIONAL BUSINESS ENVIRONMENT Lianxi Zhou EBay: China and India External Business Macro Environment Entry Report Group 2 Hugo John MASON; ID: 6513963 Boon Long Tan; ID: 6512494 Sung Jun PARK; ID: 6508247 Yasong ZHAO; ID: 6511938 Word Count: 3000 Table of Contents Introduction 2 China 3 Political Environment 3 Political and Legal System 3 Five Year Plan 3 One Belt, One Road 4 Risk 4 Economic Environment 5 Market Size 5 Currency 5 FDI 6 Socio-Cultural Environment 8 Guanxi 8 Hofstede’s Model of National Culture 9 China Recommendation 11 India 12 Political Environment 12 Political and Legal System 12 Opportunity 13 Risk 13 Economic Environment 14 Market Size 14 Currency 14 FDI 15 Regional Trade Blocs 16 Risk 16 Socio-Cultural Environment 17 Socio-Demographic 17 Trust and Uncertainty Avoidance 17 Human Resources 18 India Recommendation 19 Reference 20 Appendix 25 Introduction In recent decades a global shift has arisen and revolutionized the way businesses operate as we move into a more integrated and interdependent global economy. Known as Globalization, the e-commerce industry has been the crux of such a radical metamorphoses of nations. National economies are no longer self-contained and independent. China, having one of the fastest growing e-commerce markets at 22.6% (iResearch, 2014) has...
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...Portuese 5 DEC 2011 Why does E-Bay have problems in its Asian Markets? The situation in Asia is somewhat ironic given that in the U.S. Yahoo and eBay have forged An alliance to protect their dominance in the $12.5 billion online advertising market against Google. But in Asia, the eBay-Yahoo rivalry is ferocious (BusinessWeek.com, 5/26/06, Tech Titans Take Sides). Yes, Yahoo is a big reason that E-bay globalization in the Asian market isn’t successful. Though yahoo has some responsibility in EBAY unsuccessful Asian Market, EBay has lack the ability to conform its business model to the Asian market. EBay inability to tailor its product to the Asian Market has also been a major reason for their failure in the Asian Market. In major markets like Japan, Korea and China, Yahoo subsidiary have outperformed EBay. EBay has a simple business model of drawing revenue from passing information between seller and buyer, which require no necessity to have inventory or ship goods. This business model was embraced by foreign markets including UK, France, Germany and surely became a leader in e-commerce in the US. This success didn’t translate to the Asian Market. The reason is due to neglect of the four P’s concept, adoption, standardization, and entry time and entry market. EBay begin its entry into the Asian market in Japan, but missed their ideal time to enter the market. Yahoo had entered the Japan market six months prior to EBay. This allowed...
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...management efficiency. It is also identified from PESTEL analysis that political, social and legal environment of China is supportive for Alibaba, but there are some emerging challenges in economic environment. From SWOT, it is also found that are various opportunities and threats for Alibaba in the existing business environment. In the end, it is observed that global expansion can be effective for Alibaba to deal with future challenges effectively. Table of Contents 1.0 Introduction 4 2.0 Company Background 4 3.0 Business Performance 4 4.0 Macro and Micro Environment Analysis 5 4.1 PESTLE Analysis 6 4.2 Porter’s Five Forces Analysis 7 4.3 SWOT Analysis 8 5.0 Recommendations 9 5.1 Conclusion 10 5.2 References 11 1.0 Introduction This report is prepared to analyze external business environment for an organization and make appropriate recommendations to deal with future challenges. For this purpose, Alibaba is selected for this report. 2.0 Company Background Alibaba is a China based e-commerce company that was founded in year 1999 by Jack Ma when he launched a website called Aliobaba.com. At present, it mainly operated three e-commerce sites that are: Taobao (online shopping destination), Tmall (a third-party online platform for brands and retailers) and Alibaba.com (online shopping destination). Currently, Alibaba is the world’s largest e-commerce company in terms of customer base of millions of users, merchants and businesses as well as sales volume (Yahoo...
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...in the Emerging Chinese E-commerce Industry Yuexi Li1 Claremont McKenna College November 15, 2015 Abstract: Alibaba.com is one of the leading e-Commerce companies in China. It has grown admirably from its initial beginning as an e-Market connecting small suppliers and buyers to a giant emarketplace that has several operational platforms. Currently the heavy reliance on Chinese Economy, the counterfeit goods issues, and the competition from other emarketplace remain Alibaba’s greatest challenges. In this paper I evaluate Alibaba’s business model including its mission, vision, and values, revenue model, and its R&D structure. Alibaba’s strategy led to its competitive advantages in realizing network effect of scale and understanding the Chinese market. 1 yli17@cmc.edu 1. Introduction On November 11th, 2015, Alibaba Group Holding Ltd. (hereinafter, Alibaba) reported a record-breaking $14.3 billion in sales over just 24 hours during the “Singles Day”2, a shopping holiday. In recent years, Singles Day sales in China have out paced Cyber Monday sales in the US: According to the Reuters.com, on November 11th, 2014, Alibaba reported a $9.3 billion sales from 24 hours, which is $7.26 billion more than sum of US retail ecommerce on Cyber Monday 2014. The statistic shows the Chinese online shopping market’s power, as well as Alibaba’s leading position as the Chinese e-commerce giant. Reaching multiple...
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...regions (Mainland China, Hong Kong, Macau and Taiwan) and also abroad. Taobao Marketplace (formerly "Taobao") was launched in May 2003 by Alibaba after eBay acquired Eachnet, China’s online auction leader at the time, for USD 180 million and became a major player in the Chinese consumer e-commerce market. To counter eBay’s expansion, Taobao offered free listings to sellers and introduced website features designed to act in local consumers' best interests, such as instant messaging for facilitating buyer-seller communication and an escrow-based payment tool, Alipay. As a result, Taobao became mainland China's undisputed market leader within two years. Its market share surged from 8% to 59% between 2003 and 2005, while eBay China plunged from 79% to 36%. EBay shut down its China site in 2006. Asees the attractiveness of the e-commerce insdustry. In many ways, China seems suited for the rapid development of e-commerce. Driving forces that make e-commerce attractive includes the explosion of Internet use and the government's interest in developing e-commerce. Along with growth in Internet users has come increased e-commerce revenues. There were over 200 e-commerce web sites in China, employing over 5000 people. E-commerce revenues on the Chinese mainland grew from about US$8 million to US$24.2 million in 1999. It was estimated revenues could grew to US$96.7 million in 2000, and US$1.2 billion by the end of 2002. In 2000, China holded the most e-commerce potential among emerging...
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...International Marketing plan on FlipKart Service Student ID: 350 2015 DEEPAK, STUDENT ID: 350 FlipKart Manager 7/16/2015 FlipKart Service Submitted to Udara Wickramasinghe Submitted by Deepak Kumar Sreeramula (Student ID: 350) ICNZ 2015 Executive Summary China's spectacular economic growth-averaging 8% or more annually over the past two decades-has produced an impressive increase in the standard of living for hundreds of millions of Chinese citizens. At the same time, this economic development has had severe ramifications for the natural environment. There has been a dramatic increase in the demand for natural resources of all kinds, including water, land and energy. Forest resources have been depleted, triggering a RANGE of devastating secondary impacts such as desertification, flooding and species loss. Moreover, poorly regulated industrial and household emissions and waste have caused levels of water and air pollution to skyrocket. China's development and environment practices have also made the country one of the world's leading contributors to regional and global environmental PROBLEMS, including acid rain, ozone depletion, global climate change, and biodiversity loss. Without greater attention and commitment from the centre, China's environment is likely to CONTINUE to deteriorate throughout much of the country, causing further...
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...“Open Sesame” The Legend of Alibaba.com Nov. 11, 2012 Jia Chen Kang He Yiyi Wang Jingyan Wu Liang Xue Qiaolan Zhuo Executive Summary “To make it easy to do business anywhere” is the core value proposition of Alibaba.com, a leading B2B online market place in China with 53.8% market share. Founded in Dec. 1999, Alibaba provides both suppliers and buyers an easy to use online interface where they can match their needs. The report team considered this as an innovation because other than those typical challenges faced by innovative companies; Alibaba also faced specific challenges such as the lack of credit system in China when it was first founded, the severe pressure from capital investors due to the burst of dotcom bubble shortly after its inception, as well as the strong incumbent, eBay, entering China in 2003. By focusing on its core business of B2B online market place, continuously building its IT capability and integrating third-parties to establish a local credit rating system, Alibaba was able to stand out amongst the many players in the early dotcom age in China. At the same time, Alibaba successfully defended its B2B business by proactively entering into the C2C space and compete head to head with eBay. This report explores in specific details of actions undertaken by Alibaba, particularly by its founder Jack Ma, analyzes the impact of those actions, and finally presents an outlook for Alibaba’s business with our recommendations. Background Overview ...
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...“Open Sesame” The Legend of Alibaba.com Nov. 11, 2012 Jia Chen Kang He Yiyi Wang Jingyan Wu Liang Xue Qiaolan Zhuo Executive Summary “To make is easy to do business anywhere” is the core value proposition of Alibaba.com, a leading B2B online market place in China with 53.8% market share. Founded in Dec. 1999, Alibaba provides both suppliers and buyers an easy to use online interface where they can match their needs. The report team considered this as an innovation because other than those typical challenges faced by innovative companies; Alibaba also faced specific challenges such as the lack of credit system in China when it was first founded, the severe pressure from capital investors due to the burst of dotcom bubble shortly after its inception, as well as the strong incumbent, eBay, entering China in 2003. By focusing on its core business of B2B online market place, continuously building its IT capability and integrating third-parties to establish a local credit rating system, Alibaba was able to stand out amongst the many players in the early dotcom age in China. At the same time, Alibaba successfully defended its B2B business by proactively entering into the C2C space and compete head to head with eBay. This report explores in specific details of actions undertaken by Alibaba, particularly by its founder Jack Ma, analyzes the impact of those actions, and finally presents an outlook for Alibaba’s business with our recommendations. Background Overview ...
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...Hangzhou-based e-commerce/e-auction company, specializing in global trading. It was founded in 1999 by Ma Yun (Jack Ma), and operates five e-commerce sub-companies which operate different aspects of trading. Employees 4,400 (June 30,2007). As of January 2009, the Alibaba Group is made up of 6 sub-companies: 1. Taobao.com: Online auctions web site for customers. 2. Alipay: Online payments web site, processing mainly payments within China. 3. Alisoft: Provider of web services to the Chinese Small and Medium-sized Enterprise market place. 4. Alimama: Online advertising exchange, which allows web publishers and advertisers to trade online advertising inventory. 5. China Yahoo ! As a powerful portal with excellent searching engine, it provides high- quality basic application services for internet users including email, IM, information services and so on. 6. Koubei.com: China's largest communities for exchanging basic life information such as that on clothes, food, housing and travel. In 2009, Alibaba Group employed nearly 17,000 people, 70% worked in Alibaba’s B2B business. CRITICAL SUCCESS FACTORS 1. Clear Strategy To be the best e-business website not only in China, but also all over the world is the mission of Alibaba Corporation. The clear strategy is the beginning of the team of Ma Yun and the highest demand of all the team members. The right strategy born with the right period of e-business development in right place of China, that makes...
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...Case Study: Wal-Mart in China (2012) In 1996, China’s national economy was growing at a rapid pace. The gross domestic product reached over US$1064.4 billion, an increase of 9.7% over the previous year. To further increase and attract foreign investment, the Chinese government increased its number of experimental, special economic-zoned cities in which foreigners could operate a business. There were, however, restrictions set forward by the government, in that all foreign businesses would have to be in a joint venture or other type of cooperative agreement with at least one Chinese partner, with that Chinese partner getting a stake greater than 51%. In August 1995, Wal-Mart, the great American retain chain and Middle America success story, arrived in China, establishing a joint venture with Shenzhen International Fiduciary Investment Co, Ltc, China. In 1996, Wal-Mart opened its first supercentre and a Sam’s Club in the special economic zone of Shenzhen. In 2007, Wal-Mart acquired a 35% stake in Trust-Mart, a Taiwanese-owned chain of retail supercentres operating in the Middle Kingdom. By 2010, Wal-Mart’s presence in China grew to 189 units in 101 Chinese cities, with the creation of over 50,000 local jobs. By 2012, the company nearly doubled its presence with 370 stores in 140 cities. As the U.S. and European economies slumped in late 2011 and into 2012, the world’s number-two economy became an even more important growth market. In the first quarter of 2012, China’s...
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...1. Background Alibaba Group(Chinese: 阿里巴巴)has operated in Hangzhou which is a e-commerce and e-auction company and specializing in global trading. It was founded in 1999 by Ma Yun operates total six e-commerce sub-companies. Alibaba Group operate different aspects of trading tomakes it easy for anyone to buy or sell online anywhere in the world. Sub-companies which included: 1. Taobao.com: The web site of online auctions for customers. 2. Alipay: The web site of online payments which can process mainly payments in China. 3. Alisoft: To provide the web services to the marketplace of Chinese Small and Medium-sized Enterprise. 4. Alimama: To provide the online advertising exchange, and allows trade online advertising inventory between web publishers and advertisers. 5. China Yahoo! : To provides high-quality basic application services for internet users with a powerful portal with excellent searching engine which including email, IM, information services and so on. 6. Koubei.com: It is the China's largest community’s basic life information exchange such as that on clothes, food, housing and travel. 2. Business Model (1).Revenue Sources The advertisements or payment of members is the main revenue of Alibaba.com. Search the results in the websites by anyone, but if the firms like to sell the products through the platform, they have to be the members of Alibaba.com and need to pay money for it. This is very high profit from the advertisements in...
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...many years, China has grown to be one of the most attractive countries for foreign direct investments of almost every present organization in the world.. Despite the rise in labour costs and shortages of skilled labour along with greater competition faced by foreign firms in the China market since 2008, China has still succeeded in continuously attracting more FDI as compared to other developing countries. This essay while relating to certain FDI theories (Eclectic theory) will further discuss the general factors that has led to the increase of FDI in China despite many challenges over the years as well as using a firm such as Gap Inc. as a case example to show the main specific factors which influenced the company to undergo FDI in China. As China's population nears 1.4 billion people (Xinhua, 2010), there are many general 'pull' factors contributing towards the increase of FDI in China. One of the factors would be country's market size as accordance to Cheng & Kwan (2000) whom agreed that market size does attract FDI in China. China's large market size potentially creates huge domestic demand that provides greater opportunity for foreign firms to undergo FDI as firms access into a larger customer base would be made easier, allowing them to increase their productivity and profit of the business. This is supported by Faheem, Dost, Hussnain, Izhar, Raza & Shakeel's (2011) statement regarding the emergence of local economies of China in developing a large market size is positively...
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...Successful Globalization Into The Chinese Market Stanley Armstrong Southern New Hampshire University Abstract There has been an increasing enthrallment over global expansion across the globe. Likewise, there are many things that factor into making such an enormous decision a successful one. Some of these factors include, the strategies to which the business will use, what modes of entry they will take, and what are possible threats and opportunities that may arise. Choosing the right strategy to enter into a new market is key in determining the success of the company now and in the future. I. Introduction “Walmart Stores, Inc. was founded by American retail legend Mr. Sam Walton in Arkansas in 1962. Over nearly 50 years of development, the company has served customers and is now the world’s largest private employer and retailer, on the top of the Fortune 500 list. Walmart is among the most recognized global brands.” (Walmart China Factsheet) II. Global Expansion Lately, many large companies within the retail division who seek to increase their profits and hold a greater market share have decided to expand their companies globally. Global expansion has grown to the point where its not only attacking large companies, but has increased the efforts of those small-scale companies, those who are foreign to expanding internationally, and even those who have already ventured into international markets. There have been many up and coming...
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...Corporation Now pg.13 * Business Environment pg.14-pg.15 * The Financial Analysis pg.17-pg.18 * SWOT Analysis pg.19 * Recommendation for Alibaba pg.20 * Conclusion pg.20 * References pg.21 Definition * E-commerce Electronic commerce, commonly known as e-commerce or eCommerce, is a type of industry where the buying and selling of products or services is conducted over electronic systems such as the Internet and other computer networks. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at one point in the transaction’s life-cycle, although it may encompass a wider range of technologies such as e-mail, mobile devices, social media, and telephones as well. Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of business transactions. This is an effective and efficient way of communicating within an organization and one of the most effective and useful ways of conducting business. * B2B...
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...Comparison of eBay.com and Alibaba.com Thomas Liquori o h T a m i L s o u q . i r e m Digitally signed by Thomas Liquori DN: cn=Thomas Liquori, email=thomasliquori@a ol.com, o=thomasliquori.me, l=New York, NY Date: 2010.09.05 16:57:16 -04'00' 12/16/2009 Professor Reddi: BUS451 By: Thomas Liquori, Danauda Benjamin, and Anca Barbu EBay.com Introduction ................................................................................................................................. 3 EBay.com Products and Services .................................................................................................................. 5 TABLE OF CONTENTS Comparison of eBay.com and Alibaba.com Ebay.com Financial analysis .......................................................................................................................... 6 Ebay.com Last Three Year Financial Graphs ................................................................................................. 7 EBay.com TOWS Matrix Analysis .................................................................................................................. 9 EBAY.com TOWS Matrix Graph ................................................................................................................... 13 Competitive Forces for ebay.com ............................................................................................................... 14 EBay.com Industry Rivalry...
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