Executive summary of the Ethical Tabao company - Essay Example

Executive Summary Taobao is the largest Chinese online shopping platform occupying over 80 % of domestic online business. It accords an avenue for businesses and individual entrepreneurs to open online retail stores. Alibaba Group founded Taobao in 2003 while company facilitation is by Business-to- Consumer (B2C) and Consumer –to Consumer (C2C) models with the later exerting dominance in the company. The C2C model challenges product quality and counterfeit control. Taobao uses the egoism concept in making business decisions that favors the good of the company over the benefit of the society hence affecting many shareholders.

However, Taobao urges the public to behave responsibly to maximize the wealth of the shareholders. Taobao plans to raise its guarantee and technical charge with an objective of majoring in the B2C model to improve its quality and counterfeit control. The planned raise in fees would decrease the number of sellers operating on Taobao and consequently improve the company’s regulation. The small and medium entrepreneurs launched protests at the Taobao headquarters are opposing the planned policy since it forces them to pay same operation costs as the big sellers.

Although the policy might be beneficial to the company, the protests have largely dented the image of Taobao. The small and medium entrepreneurs will face difficulties in continuing with the business and possibly fallout. The decrease in small and medium entrepreneurs would promote improvements in product quality and guarantee customer satisfaction in comfort and reliability. However, this adjustment might decrease customer satisfaction on price and product categories. Because of the mixed interests, the government has come up with regulations governing the online shopping agencies like Taobao.

There are self-regulations by a business that allow companies to adopt policies befitting their competitive advantage. In relation to these regulations, the sellers should obey Taobao regulations. Additionally, there exist consumers’ regulations that protect consumers in Taobao. These regulations protect the consumers against counterfeit goods, poor quality goods, and untimely delivery of Taobao products.