Discuss the Operation Management Plays a Key Role in Online Shopping in China

Discuss the Operation Management Plays a Key Role in Online Shopping in China -Using Zhuodang Book Store to analyze Introduction: In China, the network informatization is rapid developing. The electronic business has become the most efficient commodity tool. Online shopping gradually becomes one of people’s consumption behaviors and e-business is a simple, quick and low-cost electronic communication mode. Consumers can through lots of methods to business activities. Such as telephone, e-mail, fax and chat software. This article will explore China online store operational management and using the delivery channels and process of Zhuodang Book Store as an example. The information and communication technique is widely applied in their operation process. This article will evaluate the effect and function of the information and communication technique that using in the delivery channels and prove online store is evolvable. I was a consumer of Zhuodang Book Store and I got an interview with the storekeeper to learn about some management flow and the process of delivery through chat software. Main bodies: The e-business has become a very important and efficient marketing method in nowadays society. The communication technology is widely applied to the e-business process and operation. ZhuoDang Book Store is a new online book store which has a sound momentum of development and many chances of improvement. However, there are some problems in their delivery process. In this article, the operations process of delivery channel will be researched and some suggestion and evaluation will be given for ZhuoDang Book Store. Introduction of TaoBao. om and the interview record will be presented in the appendix. The online storekeeper need not spend too much energy and earn money. The operations from pay to give the feedback are the delivery process. Through interview I have drawn a flow pictures about his online book store operations. From this flowchart, the storekeeper just carries on three main sections, bargaining, purchase e–books and sent book to express company, respecti vely. The storekeeper just needs to communicate with consumers. Answering their questions and promotion goods are storekeepers mainly task. After consumers paid goods, the storekeeper will receive an order, and then they will according to this order to store from source goods department and sent books to express company. (The source goods department and express company have business relations with online book store. ) Zhuodang Book Store has no stock problem, because it receives first and the purchase according to these orders, they need not to stock books. So they do not worry the stock problem which may cause the waste of resources. That lots of reduce storekeepers work load and reduce the investment. Consumers can get more benefit flexible service. â€Å"Customer – processing technology is being used to give an acceptable level of service while significantly reducing costs to the operation. †(Slack et al. 2007:234). There are essentially two types of customer – processing technology showed by Slack et al. â€Å"those that you interact with yourself and those that are operated by an intermediary. † ZhuoDang Book Store is the latter. When the customer wants to buy books, they will ask the store if they have the book and the content. Generally both customers and storekeeper use the Aliwangwang which is the telecom software that the website self-developed. Besides that, the customer can communicate with storekeeper by mail. If the storekeeper is not online, the customers can text messages to them. After dispatch the goods, the customer can contact with them to ask the process. When the customer receipts the goods, they can go to the store page to evaluate the service and give the feedback to storekeeper. One of the biggest advantages is that the storekeeper can get the feedback from customers timely. Zhuodang Book Store uses the Taobao. com system, which include research goods and feedback. After the customer paid, the storekeeper will receipt the system prompt, and then he will collect these orders. The information about customers demand and address will be checked carefully. After they send books to express company they will use the website communication system to tell customers that their goods have be delivered. Customers also use the goods query system on the website to inquiry the delivery advances. When customers get books, they can to the store page and give their assessment (good, fair and bad). Consumers also can leave massages at the online book store. The system calculate a percentage about goods quality, service attitude and delivery speed. They are called creditworthiness, which is very important influence the next customers’ selection preference. Delivery process quality plays a key role in Zhuodang Book Store. If the customers buy several books they can bargain with storekeeper or the storekeeper gives a discount for regular customers or one-time quantity buyer. But physical store sell at expressly marked price, consumers cannot bargain although sometimes the physical store has some 70% off. General opinion, the online shop price is cheaper than physical store and the profit is higher than physical store. Although the books delivered by the delivery company and saving lots of time and money, from customers ordered, the book will be send on 2-5 work days. However, buying in physical store, consumers can immediately obtain goods. In modern business, Just-in-time is a very important element. JIT aims to meet demand instantaneously, with perfect quality and no waste. †(Slack et al. 2007: 466) When the storekeeper of Zhuodang Book Store gets orders, they will ask the source books department to deliver goods as soon as possible. The customer can accord others’ assignment and the creditworthiness to select the online book store in order to assurance goods quality. People decided to shop online, that means they want to reducing the cost or they have no time to go to physical store to shop. So they are willing waiting for books a few days, which is with normal delivery days. Sometimes the storekeeper will assume delivery problems, which are not their area of responsibility. Although the storekeeper announces their delivery process of goods is accurate, other section may have problem. For example the express company may damage, loss and confuse the goods. Customers always find the storekeeper to compensate their losses in spite of that is not their duty. But this problem incidence is too low, if the storekeeper gives a good service, which can get customers satisfaction instead of affect the store creditworthiness. Finding the storekeeper is the easiest and the most direct ways for a consumer, although they know that the cause of the problem comes not from storekeepers. As an online book store, it can be promoted by internal methods and external communication. There are five performance objectives, quality, speed, dependability, flexibility and cost, respectively. Picture1 shows these five performance objectives have both external and internal effects. Picture1. Performance objectives have both external and internal effects. (Source, Slack et al. 2007:52) Focus on internal promotion methods, dividing labors, building a new system, selecting a lower cost but higher quality and speed delivery company can make performance objectives to improve. Dividing labors into different sections can improve the work efficiency and reduce delivery time. For example there should be one person to communicate with customers and another one person purchase books and delivery them. Work in cooperation with a due division of labour is one of the best ways to enhance efficiency. Building a complete sales system just like specialty shops can enhance the delivery speed. Some intermediate links can be cut. For example, the store can store up some popular books, when customers need it, the store can deliver these books as quickly as possible. Choosing a right delivery company is also important. From the above statements we can clearly see that delivery speed is one of the biggest disadvantages for an online shop. However the quality of delivery also should be observed. Selecting a lost cost but high quality and speed delivery company can obtain a big benefit. The advantages of online shopping are convenience and cheap, but delivery time is very weakness. So improving the delivery section can attract more customers. Focus on external communication improvement, contacting with customers can enhance the flexibility. When the customer asks the product condition the storekeeper should give them description. Using the communication software to contact with customers is an essential process. Through the Aliwangwang they can communicate with customers seasonable. That is a official software and it can record the chat log that can supply the evidence if there is any issue. Besides that, the telephone, e-mail and other methods can also improve the communication between the storekeeper and customers. The store should allow the customer discuss the delivery time, no matter how much money they would pay that is a good chance to improve the flexibility. Contacting with suppliers is very important. Although storekeeper buying books after customers order, they also need a good relationship with supplier in order to get high quality and low price goods. If a good relationship have been established the suppliers will give storekeepers a more or less discount and preference. In fact, most of problems occur on the delivery process of the express company. Some goods may be damaged or lost during the delivery process. Therefore, supervise and remind the express company is necessary. Once the store builds a good relationship with express company, the freight cost can be reduced. Furthermore, the storekeeper want to pay the delivery charge to the head office of the express company thus can save some time and money. Picture2 shows using the Polar diagram to compare promotion change. Picture2. Change of improvement for online store. (Red line- before; Blue line: after) Conclusion: ZhuoDang Book Store is an online-shop that sales books to general customers. The delivery process is an important section in all online stores. The store using the internet resource expands their business that is fully utilizing the information and communication technology. The delivery process is not very complicated: receive orders—collects orders—purchase books—send books to express company. Compare with the physical shop, the price of books is cheaper and can be discussed is a strength. The timely communication and feedback system also is the advantage of their delivery system. Enhancing the delivery speed and quality can bring more profit and customers. Online store have a good development potential, it should choose an applicable method to grow. In present Chinese online C2C business, the shop likes ZhuoDang Store have many chances to develop. Reference: ?Introduction of Taobao. com (2010). [online]. http://www. taobao. com/about/intro. php [Date accessed 2003-2011] ?ShenXie ShuMa (2009). Anti-fraud Guide—for shopkeeper. [online]. http://bangpai. taobao. com/group/thread/58509-578637. htm[Date accessed 03. 08. 2009] ?Slack, N et al. (2007) OPERATION MANAGEMENT. 5th ed. Prentice Hall