Selling Services Offered by J Sainsbury Plc to the Chinese Market - Essay Example

Selling Services Offered By J Sainsbury plc to the Chinese Market Introduction Selling various services has been a lucrative business in the modern world. The services to market in this project are those offered by J Sainsbury p/c. These services are home, pet, life, travel and car insurance, health cover, property management and development, telecommunication, savings accounts credit cards and loans. All these services are to be marketed in the Chinese market. The main reason behind choosing these services is that they are fast moving services and will automatically get customers for the same. Their has been increased demand for these services across the globe and availing them to the people of China will make them enjoy the services as well as making me to gain some business returns. China is a densely populated country with billion of occupants implying that the demand for these services will be very high at this part of the world. Moreso, the China’s economy is growing at a very fast rate a thing that creates a favourable business environment. I will be therefore expecting the people of China to buy my services at regular intervals thus assured business continuity. In the recent past J Sainsbury p/c has been ranked in the third position behind Tesco and ASDA. This has necessitated the company’s CEO Justin King to launch recovery programme in a bid to reclaim the second position or even be ranked in the first position. Though the group has made considerable efforts to retain its profit margins and market share since the 1990’s the company lost its second position in the year 2003 and was almost recording losses during its accounting period that ended in March 26th 2005 were it not for the one –off profit acquired through the disposal of its subsidiary in the United States. During the year 2004, Justin King who is the company chief executive officer embarked on a new strategy which was direct on increased price competitiveness, improved services that are offered to customers and supply chain overhaul which was aimed at solving the stock availability problem. This has yielded some fruits since in the year 2005 the company’s share in the UK grocery market started to increase gradually according to the reports from the TNS super panel. By setting introducing Sainsbury’s services into the Chinese market, the company will be assured of considerable growth that will see it reclaim the second position and even ranked ahead of Tesco though acquiring the first position. This is so because the Chinese market is a broad based with enough consumers of these services following the high population found in this Asian country. For the last fifteen years China has realized a continuous and rapid economic growth making it to become a popular cuisine in the world. (www.sainsburys.co.uk/) I would conduct environmental scanning in gathering information from the Chinese environment so as to better achieve a sustainable competitive advantage. This will also assist me in altering my business plans and strategies where necessary. I will perform continuous environmental scanning which will allow me to take opportunities ahead of my competitors and quickly respond to threats in the environment. This will include consumer analysis, product innovations, competitor analysis and the firm’s internal environment. Ii will carry a macroenvironment analysis on the Chinese economy concerning the economic growth, investor and consumer confidence, unemployment rate, political climate, future trends, GDP per capita among others. On the cultural analysis I will research on the ethnic origin of the Chinese people, age distribution, their attitude towards materialism, consumerism and individualism. I will also analyse the cultural structures which will include labour supply, diet and nutrition, wage expectations, strikes and labour relations, potential suppliers, housing conditions, suppliers competition level, employee turnover rate and delivery delays. The investment environment is thus very conducive in China and any well though out investment is likely to succeed as long as it is well managed. China’s national economy has also created a good macroeconomic environment following the economy’s maintenance as well as recorded increasing tempo in the last three quarters. Prices of services offered in the booming economy are competitive and assures the investor some investment returns. The broad Chinese culture will comfortably accommodate the services being offered since they are not in conflict with the cultural practices undertaken by those people from China. The Chinese culture is of primary economic status translating that achieving sales in this country can be easily achieved as long as the right mechanisms are put in place. Due to the achieved economic growth in china it therefore means that most people in this country are employed and earning their own income. High rates of employment level in any given country symbolize a high disposable income to its citizens. By having a high disposable income the Chinese will tend to buy more goods and services since they can afford. This will also imply to J. Sainsbury p/c thus increased buyer behaviour. With the increased pace of economic growth in China the buyer behaviour pattern will be maintained and increased with new buyers emerging to buy the services offered by J. Sainsbury p/c. (www.sainsburys.co.uk/) Market Entry It might be relatively expensive and somehow difficult for the company to attain the desired market penetration in rural China in its efforts of marketing the various products and services offered. This is partially because the transport infrastructure in rural China is not well established like the one in the country’s big cities for example Beijing. To counter the above problem I will introduce Electronic Commerce (E- Commerce), which will assist in ensuring a high market penetration than even the road network. This will involve selling of products, services and information via computer networks including the Internet. Through using the internet as a mode of service delivery, the company will be able to offer its clients the full range if property; insurance and banking services in China. However, E –commerce will also require certain infrastructure, which includes: (i) A network infrastructure that can be provided by telephone lines, existing TV network as well as wireless networks. (ii) A common business service infrastructure, for example, catalogue or directions of companies, smart card, electronic payment systems among others. (iii) A system that will allow messaging information distribution for instance, E – mail services, EDI etc. (Udell, 1996) By so doing the company will be in a better position enabling it to offer full online internet banking Services to all its savings accounts and credit card holders at not extra cost. Besides, I will employ telephone selling in every corner of the Republic of China since this is a popular direct marketing technique, which will definitely avail some progress in market penetration. I will also ensure installation of complex computerized mailing systems, which will help in creating customized offers and personalized messages. To acquire the expected market entry I will make large use of controlled publicity and advertising. I will employ pro- active promotional activities with the forward looking objective in mind being six percent market penetration. The pro- active promotions will also be designed in a manner that will help bring about some state of affairs, which J Sainsbury p/c thinks to be desirable. These promotional activities will be carried out to support the company as a whole but most importantly the new branch to be opened in China. They will also be carried in support of all services offered by the company, its marketing activities, corporate policy and financial activities. (Udell, 1996) I will also use reactive promotional services which will be mainly concerned with reacting, or responding to situations which arise and which are not within the original plan for instance if the branch in China were to suffer a factory fire, it will be necessary to assure supplier and customers that the company could cope with such a disaster and that it would be business normal. I will also put strategic promotional activities in place, these activities tend to be long term and are usually concerned with the overall direction that a company might take over a period of time entering a foreign market (Chinese) for the first time would be a strategic objective related to a market development policy. (Coghlan and Brannick, 2001) Launching a new range of services would be a strategic objective related to a service – development policy. Holding on to a market share would be a strategic objective related to a consolidation policy. All these policies would require a great deal of strategic promotional support bearing in mind that strategic promotional activities are pro-active Tactical promotional activities will also be very resourceful in attaining market entry, these promotional activities tend to be short term and concerned with some very specific objective such as shifting a surplus of slow moving stock. Although such an objective might have only a limited impact on J Sainsbury’s overall situation, the combined effect of a series of tactical promotions will work together, to take the company closer to its strategic objective- assuming of course, that the company has an integrated plan in which tactical objective are put in place to support strategic ones. My tactical promotional activities may either be reactive or pro – active. Though promotional activities may be directed outwards at external publics or inwards at internal publics, it will be very necessary for the company to sell an externally directed strategy internally before it can be made to work, charges in the company’s policies and procedures will as well be promoted internally. (Coghlan and Brannick, 2001) I will also embark on press/ media relations this will be a method of promotion that will be designed to get messages into the editorial content of the Chinese media. With this I will develop professional relationships with journalists so that J Sainsbury’s p/c and its services will be mentioned favourably over the media. I will also include public relations, which is wider than just press relations. This is basically concerned with the systematic development and maintenance of mutual understanding between an organization and its publics. Getting J Sainsbury and the services if offers mentioned on the radio, for example is only part of public relations public relations is also concerned with developing and sustaining a positive image of the company and its services. My public relations campaign will target the suppliers, investors, local councils, customers, government departments and trade unions in the new target market. I will also use advertising, which will help in creating awareness of our services in the new territory. This will involve designing an attention catching message, which will be aimed at the Chinese wider population. This messages will appear in recognized media in China for example, magazines or newspapers I will organize conferences and exhibitions which will be meeting in which will be meeting or which the company’s marketing staff will meet the customers so that they can discuss matters of mutual interest relating to the services offered and sometimes to carry out business transactions. The company will also involve itself in business sponsorship activities in China for a quick market entry, the company will find activities such as pop concert, football match etc in order to generate beneficial publicity for itself. The success of a sponsorship will be the amount of good publicity the sponsorship will be used to promote a corporate or public image as part of a marketing campaign or a public relations campaign. I will also apply direct marketing whereby I will promote a corporate the service directly to its final consumer. This will involve the use of directly to its final consumer. This will involve the use of direct mail, telephones sales and calling on people at home. (Nigel, 2002) Communication I will use horizontal communication method I communicating quality initiative to employees at J Sainsbury plc. This method will foster information sharing thereby bringing together all employees from the new branch to be opened in China. This method will also give room for easier and successful coordination of assignments among the workers to be employed in the new territory. In addition the method depicts important techniques for problem solving which will be very helpful to the company especially in its new environment that harbours different cultural representation. It will also help in addressing conflicts in the company so that those conflicts arising from individual’s employees or from various departments of the firm will be dealt with in the right manner. I will widely make use of consumer driver communication process. (Craig, 2000) This will enable me to get feedback from the customers regarding the services offered. If the feedback is negative I will work hard to ensure that everything is improved is a per the customers requirement. Communication will focus mainly on the customer’s reactions towards the services offered. If the feedback is positive then will know that the company is heading on the right direction and I will put necessary measures in place to ensure that this is maintained & improved for ever better market penetration establishment Source: Adapted from Schutz & Schrtz (1998: 10) I will also make use of global integrated marketing communication (GIMA), which is a system of active promotional management that in a strategic manner coordinates worldwide communications in all of its component parts both vertically in terms of promotional discipline and horizontally in terms of organizations and countries. In order to achieve technology and communication convergence I will venture into introducing new ways of communicating with the market for the effective contribution of goods & services, blurring of original boundaries, symbiotic merges 7 acquisition with external partners virtual markets, coming in terms & responding to electronic markets, outsourcing, flatter organizational hierarchies and virtual organizations. (Craig, 2000) Products and Branding To ensure easier market penetration and establishment I will design strong and reputable brand names that fit the Chinese market. The name will have China as its root of origin and will be well pronounced in other languages this will make it possible for the occupants of China as well as the immigrants to be master the brand name thus ensuring easier market penetration Through supporting many languages the brand name will as well carry out business in other parts of the world. The designed brand name will also create room for expansion and flexibility. The brand name will be a name and not abbreviation rolling smoothly off the clients tongue. Above all the brand name will be unique thus sounding different to those of its main competitors. (Schutz, 2000) Ethical & Corporate Responsibility Every business performs a number of roles in the society, these roles change over time and it’s the organizations responsibility to ensure that its business activities do not affect those people surrounding it in any negative way. There exists an implicit or explicit contract between a business and the community in which it operates I will therefore ensure that the same exist between J Sainsbury plc and the people of China. (Green and Keegan, 2003) The business will be expected to create wealth, generate employment, supply markets, innovate and produce a sufficient surplus, which will help in sustaining its activities as well as improving it competitiveness, while it contributes to the maintenance of the community in which it operates. I will not understate the interdependence between society and business. The company will require the external defence and internal order, the agreed set of rules and means of enforcing them and the mechanisms for exchange that society provides. On the other hand the society will expect business to make its contribution, the fundamental of role the business will therefore be providing the mean by which the materials needs of the community are met. These include services produces by J Sainsbury p/c. Another equally important thing for the Chinese community will be the jobs exalted directly and indirectly. These will be underpinned by the wealth created by the enterprise. This might be immediately be realized through wages, dividends, taxes or loan repayments or deferred though investment, accumulated profits or loans to others. Ethical and corporate responsibility (Green and Keegan, 2003) As defined by Keegan and Schlegelmilch (2001), corporate social responsibility is a theory that indicates that it is the duty of all business organization to take care of all their stake holders in each and every phase of their operations Sainsbury Plc will therefore be committed in making sound contribution in Chinese economic development and at the same time improve its employees standard of living alongside those of their immediate families and the surrounding community as a whole. Services offered in the company will be aimed at ensuring customer comfort and satisfaction. This in itself will show the company’s commitment in ensuring that corporate social and environmental responsibility in adhered to. I will also make sure that the company human resource department practices corporate social responsibility in its staff recruitment program. Much credit will be given to the Chinese community since the company will be operating in their country. Corporate social responsibility will guarantee that staff recruitment and promotion is based on merit i.e. academic qualifications and experience, the recruited employees will under go training will a promise of job retention a thing that will reflect the company’s commitment in improving the general welfare of its employees. The company will sponsor events such as ball games, integrating its stakeholders in fund raising activities among other forms sponsorship all of which will demonstrate unity and concern, the ingredients of corporate social responsibility. (Keegan and Schlegelmilch, 2001) The company will embark on the necessary measures that will help in risk management thereby ensuring that its employees are provided with protective clothing when working and a health facility (unit) will also be set up in the compound to ensure that clients, workers and suppliers who get sick within the company vicinity are well attended to. The company will take part in the environmental conservation along with taking good considerations on the staff, customers and the entire community’s health and safety. This will include maintaining cleanliness and tidiness in the surrounding environment while minimizing on those activities that may lead to air, water and soil pollution. I will ensure that the company acquires a license from the Chinese government, which will allow it to conduct its business in China consequently according respect to labour standards and corporate citizenship. (Keegan and Schlegelmilch, 2001) Corporate social and environmental responsibility will be exhibited in the Chinese branch in that well audited and accountable reports will be produced annually focusing on the company’s sustainable development issues and corporate social responsibilities. The organization CSR will be based on its public relations departments, department in charge of business development as well as the human resources department. (Hollensen, 2004) Though offering online services the company will be in a position of availing its services to more customers another indication of co-operate social responsibility characterized by the widened customer base. All its brands will have an international appeal, will be very strong and based on the necessary ethical values. The pay package to be offered to the branch employees will be sustainable as per the Chinas economy. I will ensure that the remuneration allows the people from China to lead a comfortable life thus increased standards of living. The fact that J Sainsbury plc will be offering loan services to its customers and employees will make it socially responsible. Other services for example, medical services, insurance cover among others will also be offered. The company will initiate necessary programs to ensure that its employees will be motivated. This will be through training courses, bonuses to the effective employees and holding seminars and workshops in order to address challenges facing the customers, employees and the community in general. The company will also make use of the technological advancement so as to offer services at reduced prices translating into efficient and proper use of resources. (Hollensen, 2004) Reflection on the Activity I carried the research through wide reading of various books from different authors. For the choice of service to market to China I gathered materials from the Internet on the services offered by J Sainsbury plc. Through Internet search I realized that the company does not sell its services in the wider Chinese market. I viewed the booming economy in China as a very conducive environment for the company’s business undertakings. I therefore settled on this noble idea of selling all the services that are offered by J Sainsbury with a prediction of increased business activities, which will translate into increased profitability. I carried out some environmental analysis regarding the Chinese market and read business journals that touches on Chinese business culture, its customers buying behaviour as well as their buying patterns. These resources assisted me in conducting an opportunity analysis of the Chinese market as my selected target. I had to read widely about the emerging economy in China so as to better estimate the income for the China’s residents. This was meant to assist me in designing and developing proper techniques to help me in acquiring a quick market entry of my services to the Chinese market. This went along with establishing sound branding for my services, researching on the best business communication methods to apply, the price tags to put on my various services as well as the desired supply chain and distribution. I also ensured that I carried adequate research pertaining to the ethical and social responsibility to ensure that J Sainsbury puts all the necessary business ethics and co-operate social responsibility into consideration as it starts its business activities in the ventured Chinese market. However, I did not carry out effective research on the sales force required while selling such services in a foreign country i.e. China, the best organization and control mechanism to be planned for the new branch as well as failing to come up with a time scale for market entry and the training and budgeting considerations to be put in place. Nevertheless, if given the opportunity to repeat the assignment I will make a point of consulting most of my friends who either operates business in China or are conversant with the Chinese business environment. These people will be very resourceful in giving me the true picture of China, the available opportunity is culture and a much updated environmental analysis. They will give me the current business situation in China and advise me on the services I am intending to sell there. They will also offer valuable advisory services on the best mode of supply, chain and distribution to apply. Besides, I will ensure that I carry out effective research relating to the sales force so as to know the number of sales personnel to employ in the new Chinese branch this will assist me in designing a better and accurate budget before my business operations kicks off. In addition, the research will help me in knowing the courses and training services to offer to sales team. Reference Carter, S and Lee, K. (2005): Global Marketing Management: Changes, New Challenges and Strategies, Oxford, Oxford University Press. Coghlan, D and Brannick, T. (2001): Doing Action Research in your own Organization. London, Sage Cooper, D and Schiveller, D (2001): Business Research methods London McGraw-Hill Craig, W. (2000): Practical Marketing in Canada, Toronto, Burns Limited Czinkota, M. and Ronkainen, I. (2004): International Marketing, 7th Edition, Thomson, Doole, I. and Lowe, R, (2004): International Marketing Strategy - Analysis, Development and Implementation. 4th. Edition, Thomson Learning Frank, A. (1999): Value Pricing For the Design Firm, New York, Wiley-Interscience Frank, V. (1998): Concurrent Marketing, Boston, Harvard Business School Press. Green, M. and Keegan W. (2003): Global Marketing, 3rd Ed., New Jersey, Prentice Hall Intl. Helsen, K. and Kotabe, M. (2004): Global Marketing Management, 3rd Edition, New York, John Wiley and Sons Hennessey, H. and Jeannet, J. (2001): Global Marketing Strategies, 5th Edition. Boston, Houghton Mifflin Hollensen, S. (2004): Global Marketing, a Market-Responsive Approach, 2nd Edition, Essex, Pearson Education Keegan, B. and Schlegelmilch, B, (2001): Global Marketing Management – A European Perspective, Pearson Education. Kervin, J (1998): Decision making: Proven Method for Better Decisions, Maiden, MC Graw-Hill Nigel, F. (2002): Market led strategic change, Butter worth, Heinemann. Sainsbury’s www.sainsburys.co.uk/ (Retrieved on 02.05.2007) Schutz A. (2000): Sales Promotion Essentials, New York, McGraw-Hill Udell, J. (1996): Successful Marketing strategies in American Industries, Madison, Wisconsin Mirren Usunier, J. (2000): Marketing Across Cultures, 3rd Edition, Harlow, FinancialTime/Prentice Hall Read More