Feasibility Analysis: Donate Steps, Donate Outfit for Alibaba in China

This report conducts a feasibility analysis for Alibaba's proposed Corporate Social Responsibility (CSR) project, "Donate Steps, Donate Outfit," within the Chinese market. The analysis begins with an overview of the rapidly growing Chinese economy and its positive impact on the business sector, emphasizing the increased purchasing power of consumers and the growth of e-commerce. A market analysis highlights China's socialist economy, its ranking as the second-largest economy, and its leading position in purchasing power parity, along with the benefits of foreign direct investment and trade agreements. The report also examines the availability of a skilled and large labor force, which attracts multinational organizations. The SWOT analysis evaluates the strengths, weaknesses, opportunities, and threats associated with Alibaba's operations in China. Strengths include successful merger and acquisition strategies, high customer satisfaction, and reliable supplier relationships. Weaknesses identified include equity distribution and discounting practices. Opportunities include the growing economy, population, and the increasing demand for e-commerce. Threats include intense competition from other e-commerce businesses. The report concludes that the benefits of Alibaba operating in China outweigh the threats, suggesting a positive outlook for the CSR project's implementation.

Donate Steps, Donate Outfit

Contents
Feasibility Analysis.......................................................................................................3
Chinese Market analysis...........................................................................................3
SWOT analysis.............................................................................................................4
Strengths...................................................................................................................4
Weaknesses..............................................................................................................4
Opportunity................................................................................................................4
Threats......................................................................................................................4
References...................................................................................................................6

Feasibility Analysis
Chinese Market analysis
The economy of China is one of the fastest-growing economies in the world. Up until 2015,
China was ranked number one in the list of fastest-growing economies in the world with an
average rate of 6% in the last 30 years. This type of economy definitely has a positive
impact on the overall development of the business industry. One of the most important
factors that a growing economy has on the business industry is the increase in the
purchasing power of customers. The growing economy will definitely result in growing job
opportunities for people that will result in increased job opportunities (Geissdoerfer et.al,
2017). One of the primary factors in the economy that helps business organizations is
purchasing power of customers as overall revenue organization can be increased
significantly if the customer has sufficient financial resources. China is a socialist economy
and it is the second-largest economy in terms of nominal Gross Domestic Product. In
addition to the economy of China is ranked first in terms of purchasing power parity.
Relaxation in foreign direct investments and effective and efficient trade agreements with
several countries such as Australia, Pakistan, New Zealand, South Korea, etc. has helped
the business organizations in this country to grow on a global level (Breslin, 2016).
An effective contributing factor towards the growing economy of China is the availability of
skilled and large volume of the labour force. The majority of multinational organizations are
establishing their manufacturing units in China as a skilled labour force is available at a
cheaper cost. As of 2018, it is estimated that to the total labour force in China is 789
million which makes it the world's largest labour force (Liu and Yeh, 2015). Manufacturing
organizations in China are not required to establish their production units in outside
countries as an effective and efficient labour force is available in China. China is
considered as world's E-commerce market in terms of the transaction value which shows
the prospect of growth and development in the e-commerce industry of China. The
population of a country is one of the most essential factors that influence prospects of
growth and development in e-commerce business (Shambaugh, 2013). China is the
world's most populated country and it will definitely help in the growth of this industry in
future. The median age in China is 37 years as per statistical analysis in 2019, therefore it
can be said that majority of the population are aware of the use of internet and e-
commerce business (Geng et.al, 2013).
Alabama is one of the fastest-growing e-commerce businesses in China and the main
focus of this report will be to implement CSR activities in the Chinese sector of Alabama.
Some of the most influential competitors of Alabama in the Chinese E-Commerce
business are Amazon, Jingdong, eBay, Zalando, and Groupon (Ambler, Witzel and Xi,
2016). Some of the CSR activities that are proposed to be included in Alabama are as
follows-
 100 outfits will be donated in a period of 6 months to the needed children.
 Pingliang Railway High School will be the primary target in which these outfits will
be donated by Alabama Company.
 In addition to that, donations of tracksuits will also be made Gansu Province China
which is significantly affected by the earthquake.
The CSR activities are expected to have a positive background image of the organization
in China and it is expected to have a positive impact on overall revenue generation
capability.

SWOT analysis
It is important for an organization to understand its own strengths and weaknesses before
initiating any kind of project. Therefore this section of the report will conduct a SWOT
analysis of Alabama company before initiating "Donate steps, donate outfits".
Strengths
 Merger and acquisition strategies- Long term growth and development strategy of the
organization has been very positive for the business (Tan and Ludwig, 2016).
Management has been able to acquire significant resources over a period of time in
order to expand its business operations quickly.
 The level of customer satisfaction- the quality of product and services provided by
Alabama Company has been very positively received by customers which have
increased the level of satisfaction among customers (Liao, Cai and Li, 2013).
 Reliability with suppliers and the availability of a highly-skilled workforce is another
positive aspect of Alabama Company.
Weaknesses
 Equity distribution- one of the factors that will have a negative impact on operations in
future is that management is not putting any restrictions on a number of equity
shareholders that can be registered as partners in the company (Giuffrida et.al, 2017).
 Discounts- Management is providing a significant amount of discount to sellers on the
official website of Alabama which is the primary reason that customers are able to
purchase goods and services at reasonable prices (Wang et.al, 2018). This will have a
significant impact on short term profitability of the company.
Opportunity
 Growing economy and population- The number of target customers is expected to
increase in future as China is one of the fastest-growing economies and it is also
ranked 1 in terms of population (Kim, Zhang and Zhang, 2016).
 Increasing demand for e-commerce portals- The trend of online shopping is also
increasing which will have a positive impact on business organizations that are already
established in China.
Threats
 The level of competition is one of the primary threats that will affect the overall
business operations of the company in future (Havinga, Hoving and Swagemakers,
2016). The level of competition in the Chinese market has been increasing with the
presence of E-Commerce businesses such as Amazon, eBay, Groupon, Jingdong and
Zalando.
 The organization is thinking to expand in the Indian market which will be difficult due to
the presence of Amazon and Flipkart in India.
After conducting SWOT analysis it can be said that the overall benefits of Alabama
operating in China are significantly higher as compared to threats and weaknesses.
Management of the organization has significant experience in the Chinese market and the
availability of financial resources is also sufficient. It can be said that management of
Alabama will not have any problems in initiating CSR project i.e. "Donate steps donate
outfit" in China.

References
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