Some of the unique aspects and challenges of doing business in China that Sarah Harrison encountered
Sarah encountered various unique aspects of doing business in China as well as challenges. In the Western world of business, she could have done her job in a shorter time than what she spent in the First Department Store. The first business meeting was for introduction, which covered the 5000 years history of China among other aspects. Hence, patience is an important business virtue in China, which is different from the Western world where life is fast-paced. Another unique aspect of the Chinese way of doing business is the installation of security cameras to monitor the employees’ activities rather than having security personnel guard the stores.
It was a unique feature as well as a challenging aspect for the government to introduce an employee quota system regardless of the size of a business (Ambler et al. 2009). In addition, Sarah found out that business accounting records, which show the inventory turnover, were not properly kept and managers seemed to have little knowledge on the subject. Lastly, business employees do not have any knowledge of merchandise and the business they work for, which is unheard of in the western world of business where employees are expected to know what they are handling in the line of their duty.
The various challenges of doing business in China include the government employment-quota system that demands the hiring of more than enough employees. This aspect brings forth the challenge to have employees undergoing proper training as well as motivating them. Employees also have a challenge in knowing the business they work for, as their employers do not have training platforms in place.
Problems facing the First Department Store
The various problems facing the department include competition from thousands of small vendors along the streets who can afford to sell items at a much lower price than the First Department Store. A large number of employees also causes a problem for the store, whereby employees give a lesser contribution to the store than they receive. The store also has a problem of attracting customers due to its unattractive branding on the outside as well as untidy façade.
Another problem facing the store is poor customer service that emerges from the excessive human traffic in the store with a complicated customer service framework that is a time-consuming venture. Hence, the business loses customers to other stores that have quick customer service frameworks. In addition to the customer service problem, the business can lose customers as employees do not attend to foreign customers using foreign languages, but rather they use sign languages. This phenomenon is common across China where most employees have not learned other languages, and thus they only use Chinese in their communication.
Recommendations that Sarah would offer to the management of First Department Store and their reasons
Firstly, the store should hire employees who can communicate with foreign customers efficiently in order to improve customer service and enable customers to shop confidently. Moreover, the business should lay off some employees or transfer them to other departments in order to ease human traffic on the isle. In addition, the business needs renovation on its outer face in order to attract customers along the city streets as well as tidying up the façade, which in its current state can contribute to loss of customers. Additionally, the business should have a proper accounting practice in place, and thus the managers need to hire accounting personnel to manage business accounts that seem to be ignored in the current situation. The accounting department is critical to the success of any organization (Levy & Weitz 2008).
The store should also invest in branding and renovation whereby it will bring in another venerator to serve customers and be different from the existing one that serves merchandise freights. In addition, the store should have uniforms for its employees in order to distinguish employees from customers. In order to ease the human traffic issue and improve customer service, the store managers should allow customers to pay and receive items at single entries rather than the double-entry system that exists. Lastly, since the store targets foreign customers, the managers should consider increasing spaces for international merchandise as well as doing proper arrangements in the store.
Other crucial information she needed to know before making recommendations
Sarah needed to know two crucial pieces of information before making her recommendations. First, the store faces the challenge of employee motivation due to their large number. Therefore, she needed to know the nature of industrial relations mechanisms that the store had in place in order to ensure that employees were in a good relationship with their employer. This aspect would have helped her in determining whether employees pose other potential risks to the store apart from their large number. Secondly, she needed to know the timeline that managers could have stipulated for the necessary changes to be implemented. This element would have enabled her to arrange the recommendations according to their urgency for the benefit of the store. Some recommendations such as renovations and time-saving mechanism are short-termed while others do not sound urgent.
Reference List
Ambler, T, Witzel, M & Xi, C 2009, Doing Business in China, RoutledgeCurzon, Abingdon, OX.
Levy, M & Weitz, B 2008, Retailing Management, McGraw-Hill, Irwin.