Development and Expansion of Logistics System of Chinas E-commerce Sector - Research Proposal Example

Development and Expansion of Logistics system of China’s E-commerce Sector 1. Introduction The purpose of this study is to conduct a comprehensive impact assessment in the past decade of the development and expansion of the logistics system in China’s e-commerce market. This will be a quantitative research and it will provide a numeric description of the comprehensive impact assessment of the logistics system in China’s e-commerce market. The research question is premised on the positivist worldview paradigm because I intend to use observations and measurements when testing theories related to the research question. 1.1 Aim of the Research The aim of this research is to conduct a comprehensive impact assessment in the past decade of the development and expansion of the logistics system in China’s e-commerce market. This paper intends to explain why China’s e-commerce sector has grown at a very high rate in the past decade. In this study, the researcher will analyze the current situation of e-commerce development in China, and also figure out the obstacles faced by this sector. 1.2 Research Questions E-commerce in China has experienced tremendous growth in the past ten years. According to experts, this growth is largely attributed to the local environment in China. This paper intends to conduct a detailed analysis of this local environment. In addition, the researcher will introduce the current situation of e-commerce development in China and highlight the major challenges faced by this sector. In broader terms, the paper will conduct a comprehensive impact assessment in the past decade of the development and expansion of the logistics system in China’s e-commerce sector. More specifically, the following are the research questions that the study intends to provide answers to: What are the factors that led to development and expansion of the logistics system in China’s e-commerce market? What is the current situation in China’s e-commerce sector? What are the influential factors that have improved the development of e-commerce in China? 1.3 Research Objectives The long term objective of this research is to analyze the development and expansion of the logistics system in China’s e-commerce sector. Particularly, the following are the sub-problems of this research: Explain why the ‘golden projects’ initiated by The Chinese government led to the development and expansion of the logistics system in China’s e-commerce sector. Figure out the internet penetration rates in China, and Asia at large. Highlight the major challenges faced in this sector. 2. Literature Review Studies have indicated demonstrated the importance of logistics in e-commerce. In any e-commerce business, there is need for support structures that would facilitate retail system. Nowadays businesses have moved away from traditional business models and have started accommodating new ways of conducting businesses[DAV15]. Technically, in conventional retailing supply chain, the responsibility of purchasing goods lay in the hands of customers[JMa14]. The customers in this case travel to the stores to access products and services, and the retailers only provide the services of transportation of goods when the products are bulky. As noted in a study by Rodrigue, (2015), location is very important in retailing and retailers are often faced with the burden of high costs of maintaining accessible locations. Since accessible locations are pre-requisites for success of retailers in conventional retailing supply chain, they have to pass on the high costs of maintaining them to the customers. In the end, customers will have to spend high on products and services[Xia13]. To reduce these costs, many retailers opt for e-commerce. Statistics have indicated that e-commerce has gained popularity across the world. Online selling has brought significant changes to the retail logistics system. First, almost all sellers are entirely online. Secondly, there has been increased flexibility in locations[Kat15]. This means that online sellers do not have the stress of looking for location of their operations, but they enjoy the freedom of choosing their own place. There have been cases whereby smaller online retailers use their homes as warehouses and offices. Third, customers have now built a connection to supply chain. Customers using e-commerce communicate with the store directly thereby connecting to the supply chain[Xia13]. In China, studies have demonstrated how online shopping in China is transforming logistics market. China has experienced growth in e-commerce at an impressive rate since 1993. This is mainly attributed to the Chinese government’s ‘golden projects’ that intended to build technology infrastructure and regulatory frameworks for e-commerce in China[Hof15]. The results of this project were very positive and included the multiplication of e-commerce in China. The main objective of Chinese government is economic development. Chinese people have been influenced by the government to grasp any business opportunity that arises. This is the reason why the Chinese government has focused more on the economic gains that can be brought by e-commerce. The government has set aside a lot of money for e-commerce development in China in order to realize all the opportunities brought by it. This is a strong indication that the Chinese government is willing to develop e-commerce in China[Dun15]. However, despite the efforts by the Chinese government to develop e-commerce in the country, there are inefficient logistics systems. As evidenced by Martin,( 2014), the local logistics in China is underdeveloped. Statistics indicate that nearly 85% of e-commerce companies in China rely on outsourcing distribution services because of unreliable distribution systems in the country[Hof15]. For instance, the Chinese Postal Corporation has staffs that are not adequately trained in e-commerce. This is very clear indication that China is not ready to meet the ever increasing demand for e-commerce. Despite the unreliability of China’s logistics systems, there are companies that have provided these services, but at very high costs. These companies are proof that the Chinese government is beginning to implement policies aimed at developing and expanding the logistics system in China’s e-commerce market. As noted in a study by [Deb00], logistics have evolved in very many ways. In the 1970’s, suppliers delivered goods directly to retail stores. In 1980’s, retailers brought in the idea of centralizing store deliveries. In 1990’s, there world experienced global sourcing gaining popularity. Many retailers developed import centers where goods were received in containers from ships. Currently, the trend is e-commerce and retailers have focused on creation of e-fulfillment networks for distribution[Deb00]. That said, the few companies in China that have improved logistics systems have evolved and have changed from traditional logistics system. These companies have taken advantage of growth of online retail. These companies distribute goods to customers through established postal and freight networks[RodMS]. 3. Methodology 3.1 Research Methodology As stated in a study by Gorard, (2013), research methodologies are plans for conducting a research. There are three research designs. These are qualitative, quantitative, and mixed research designs. A study by Creswell(b),( 2012) further defines these three research designs: Quantitative research This is a type of research that involves testing of theories by analyzing numbered data using statistical procedures. In this research, the researcher uses questionnaires and surveys to collect data. The researcher then uses the data collected to either refute or accept the hypotheses that he/she has generated[Cre13]. There are advantages of quantitative research design as validated in a study by [Cat15]. This research design allows a researcher to measure and analyze data. The researcher is able to understand the relationship between independent and dependent variables in his/her study. Therefore, by using quantitative research design, a researcher is able to be more objective on the findings[Cat15]. There are also disadvantages of using quantitative design. The major disadvantage highlighted in almost every study is that, researchers using this design often ignore the context of the study[Cat15]. This means that the researcher does not use natural setting while conducting the study. Additionally, the design requires the researcher to use large sample of population. This is because large samples provide accurate results[Joh12]. Qualitative research This type of design explores meanings behind problems. In this design, the researcher mainly uses in-depth interviews to collect data. In many cases, the results obtained from this type of design are usually descriptive in nature. According to a study by Creswell, (2013), a person may prefer to us this design when he intends to probe, observe, record, and interpret non-verbal communication. There are advantages of using qualitative design. This design is very useful to researchers with no idea of what will be studied or who have not formulated research questions[Ste13]. Additionally, researchers using this design do not require strict design plan. Furthermore, researchers using this design acquire rich information because they use textual descriptions and visual evidences. Researchers in social sciences prefer this design because it focuses more on context and social meanings[Cre13]. The main disadvantage of using qualitative design is that researchers can be biased when providing results. Normally, researchers using this design are required to use their own view when interpreting the research. Additionally, this design demands a lot of time from the researcher[Hof15]. For this research, I will prefer quantitative design because I intend to test relevant theories associated with the development and expansion of the logistics system in China’s e-commerce market. Additionally, I preferred this design because I need a strict design before I begin the study and I need to identify the relationship between an independent and dependent variables involved in this study. 3.2 Philosophical ideas There is need for philosophical ideas because they often influence the research. For this study, the research question falls under positivist worldview paradigm. I preferred this paradigm because I will conduct a quantitative research that involves generating of hypotheses[Rob13]. 3.3 Strategies of inquiry The table below indicates various types of strategies of inquiry Qualitative Quantitative Mixed Methods Experimental Designs Non-Experimental Design Narrative Research Phenomenology Ethnographies Grounded Theory Studies Case Study Sequential Concurrent Transformative I will prefer survey research which is common in quantitative studies. This will require preparation of samples of respondents. After obtaining the sample, I will provide a questionnaire to obtain data from them. I will also emphasize on non-experimental design. This is because I am required to provide numeric description of the research question. References DAV15: , (BARBOZA, 2015), JMa14: , (Martin, 2014), Xia13: , (Xianglian, 2013), Kat15: , (Chu, 2015), Hof15: , (Hoffmann, 2015), Dun15: , (Hewitt, 2015), Deb00: , (Bayles, 2000), Deb00: , (Bayles, 2000), RodMS: , (Rodrigue, 2015), Cre13: , (Creswell, 2013), Cat15: , (Jones, 2015), Cat15: , (Jones, 2015), Cat15: , (Jones, 2015; Maxim, 1999), Joh12: , (Creswell(b), 2012), Ste13: , (Gorard, 2013), Rob13: , (Yin, 2013), Read More