Strategic Issues faced by Alibaba in its effort to relocate to the United States

Running head: ALIBABA
Assessment 2: Individual Report
[Strategic Issues faced by Alibaba in its effort to relocate to the United States]
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Name of the university:
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1ALIBABA
Executive summary
E-commerce is constantly growing in popularity around the globe. China and the United
States are two of the most favorite destinations for e-commerce retailers. This study also
revolves around the e-commerce business in the context of Alibaba. As per a report, Alibaba
is moving to the United States with its headquarter based in the country. It is about to open a
strategic warehousing facility in the country. However, Alibaba’s journey in the United States
is predicted to be challenging for many reasons. A stoppage to Huawei's further expansion in
the US and already existing trade tensions between China and the United States can create the
problems. The trade taxes are on a rise. On the other hand, the demand for cheaper products
is also growing. There is an increasing tendency to judge a business with its CSR activities.
All these need to be managed to become cost-competitive. Alibaba needs to ensure that it
meets the demand for the lowest price. Additionally, there is a need for increased profits for
sellers. Innovation can help in cost-competitive practices along with providing benefits to
both sellers and consumers. Alibaba needs to be more flexible in terms of utilizing
appropriate strategies. In the course of doing so, it can adopt a few strategies such as those
recommended in this study.

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Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
SWOT analysis.......................................................................................................................3
PESTEL analysis....................................................................................................................4
Porter’s Five Forces analysis.................................................................................................7
VRIO analysis........................................................................................................................9
Conclusion................................................................................................................................11
Recommendations....................................................................................................................11
References................................................................................................................................15

3ALIBABA
Introduction
Jack Ma with 18 people laid the foundation for Alibaba in 1999. It is a business-to-
business portal, which provides opportunities to Chinese manufacturers to sell their products
to people all around the globe. It is the biggest e-commerce service provider in China. As per
a report, it earns an approx 80% of its entire earnings from China itself (Alibabagroup.com
2019). The purpose of this study is to identify the strategic issues to be faced by Alibaba in its
effort to operate in the United States. It is about to relocate to the United States making it the
headquarter destination for the company. It will also consider establishing a warehouse
facility in the United States. The study also recommends how Alibaba can manage to perform
well in the United States.
Discussion
This section assesses the challenges and opportunities for Alibaba in the United States
by doing a strategic analysis of the case. The strategic analysis will include assessing Alibaba
using different management frameworks and models. These are SWOT analysis, PESTEL
analysis, Porter’s Five Forces analysis, VRIO analysis and Hofstede’s Cultural analysis.
SWOT analysis
Strengths
 Leading e-commerce provider in
China and one of the leading
providers at the global level
 Investor trust on a boost
Weaknesses
 The business model is easy to imitate
 Not so healthy trade relationship
between the United States and China
 Slow delivery time