Ecommerce and Chinese Economy

Ecommerce and Chinese Economy

The perspective of electronic commerce or e-commerce concerns business transactions that involve the transfer of information through the internet. In this sense, e-commerce covers different types of transactions that range from consumer based retailing, auction of products, as well as the exchange of product and service offerings by international corporations. The emergence of e-commerce activities is regarded as the most important aspect of the internet as it allows consumers and organizations to facilitate the exchange of goods and services electronically without influencing barriers such as distance and time. E-commerce has played an influential role in the development and growth of global economies through measures such as information technology and the promotion of globalization of markets. The growth and adoption of electronic commerce into organizational business operations has been rapid as states and corporations seek to maximize on revenue generation through manipulating the vast customer base brought forth by internet platforms such as Facebook, Google, and other website databases.

Particularly, e-commerce is much of a business issue and not a technological aspect. It involves varying levels of complexity and operational costs depending on the business needs of an enterprise. The integration of information and communication technology into business operations as exemplified by the research brought forth by Hempel (p354, 2002) facilitates the improvement of business operations through the implementation strategies such as electronic record and book keeping as well as the management of organizational projects. In this sense, the sale of product and service offerings through the internet enables the eventual realization of reductions in expenditure incurred by customers or organizations due to the costs of storage and transportation. This study focuses on the economic implications of e-commerce for the economy of China as it is quite evident that the growth of the Chinese market and economy is subject to the integration of aspects associated with information technology.

1.1 Research Question

  • What are the implications of integrating e-commerce aspects and information technology to the Chinese economy?
  • How did e-commerce influence the growth of the economy in China considering aspects of organizational growth and revenue generation by the government?

1.2 Research Objectives

  • The research seeks to determine the various impacts that e-commerce and ICT had towards the rise of the Chinese economy
  • The research further critiques the various elements that supported the integration of e-commerce and information technologies to the Chinese markets with succinct consideration of organizational management
  • The consideration of issues associated with globalization and internationalization of businesses in China, the research provides clarity on the measures and policies that the Chinese government utilized to promote e-commerce
  • Further, the research utilizes scholarly reports to determine the impacts of e-commerce on employment and respective growth of the production industries in China.

1.3 Rationale of the Research Topic

The e-commerce perspective in business operations facilitates the possibility of 24/7 operational capability thus bringing forth enormous opportunities to organizations. As indicated by the research facilitated by Lowrey (p243, 2015), e-commerce integrates dynamism to business activities. The Chinese economy is thought to have growth by over 120% since the start of 2003. The revenue estimates as of the fiscal year of 2012 were as high as $210 billion thus attracting global attention as analysts sought to determine the market characteristics that were supportive of such growth levels. Particularly, there have been numerous scholarly reports seeking to explore the issues associated with the growth of the Chinese economy. As such, this research studies lays succinct emphasis on e-commerce and information technology as the major aspects associated with the improvements in China’s economic conditions.

CHAPTER 2: LITERATURE REVIEW

2.0 Introduction

This section of the dissertation chapter concerns the analysis of the various literature sources relating to e-commerce and the growing economy of China. Laying concise emphasis on the stipulated objectives brought forth in chapter one, the literature review section provides an analysis of the various aspects of the Chinese economy about the integration of strategic initiatives and innovative measures regarding e-commerce. As indicated by the research studies brought forth by Hempel (p178, 2015), the creation of a successful venture in online business operations requires succinct awareness on the various e-commerce principles such that the organizational management gains oversight concerning the objectives they could attain from online platforms. As such, the understanding of the guidelines necessary for the implementation of the proper e-commerce business plan is critical for the eventual attainment of improved business operations (Chan p110, 2011). As indicated by the research undertaken by Chung (p145, 2011), the implementation of e-commerce programs in China is attributable to factors such as the promotion of awareness, development of human resources and skills, integration of regional strategies, improved financial allocation from the government, and the eventual liberalization of telecommunication and information technology.

Alternatively, the utilization of e-commerce in major countries is subject to various mitigating factors concerning education and awareness, small market sizes, and the absence of e-commerce infrastructure. These factors as exemplified by the scholar reports by Ma (p134, 2017) hinder mechanisms for developing e-commerce such that the unavailability of delivery infrastructure, payment mechanisms, supportive business policies such as the absence of tariff quotas discourage the involvement of foreign organizations in the market venture. China’s retail sector as brought forth by the studies facilitated by Martinsons (p380, 2012) is amongst the most wired e-tailing as it commands more than 6% of the total sales in the Chinese market productions. The report as well indicates that only a small portion of e-tailing operations occur directly between the retailers and consumers.

Particularly, major e-commerce operations in the Chinese economy occur on digital marketplaces and platforms such as the Alibaba website (Chamon and Kremer and IMF p456, 2016). The e-tailing operations as such are a characteristic of replacing traditional retailing transactions that ultimately promotes stimulated consumption. The Chinese e-tailing revolution as indicated by the findings brought forth by Lei and Wang (p130, 2009) has been a catalyst for the eventual realization of a better digital future whereby consumers have the ability to acquire basic commodities such as food through online platforms thus limiting expenses incurred due to transportation costs. As such, 90% of China’s electronic retailing operations occur on virtual marketing platforms (Ma p196, 2017). The sprawling electronic commerce platforms enable manufacturers, small and large retailers to manipulate the vast internet population through integrating marketing and advertisement techniques.

2.1 E-commerce and the Growth of Chinese Economy

The irrefutable significance of e-commerce in the realization of economic growth in major states has facilitated the initiation of various research studies as many scholars seek to determine the industrial impacts of ICT and e-commerce. For instance, the research by Bergsten (p541, 2005) provides a succinct comparison of B2C e-commerce operations in China to the rise of employment opportunities in the region. The empirical study brought forth by Burba and Project Management Institute (p342, 2016) as well exemplifies on the various success factors associating to e-commerce elements in the publishing industries situated in China. The scholarly findings facilitated through the study lays emphasis on the necessity for global e-commerce comparison especially regarding the development of emerging markets that would eventually provide international corporations and industries with better market ventures to improve on their revenue generation (Zhu and Kotz p98, 2011).

The comparison of e-commerce aspects in major states enables the development of strategic measures that would eventually promote the economic conditions of the Chinese markets. The economic growth experienced in China is quite exceptional as indicated by the research findings formulated by Winn (p258, 2012). In this sense, the Chinese gross domestic product (GDP) as of 2006 rose by 10.7%, and most scholars attribute this exponential growth rate to ICT technologies and the integration of e-commerce into the various industrial production and business processes. An analysis of the Chinese economy as well indicates an annual growth rate of 9.2% every year after the implementation of e-commerce strategies. With consideration of purchasing-power-parity, China ranks second in the globe behind the United States. There is potential future market growth attributed to such purchasing power as Hempel (p354, 2002) claims that the existence of intensive levels of market demand and purchasing power is a considerable factor in attracting foreign investments and organizations.

According to data brought forth through the studies undertaken by Sharp and South China Morning Post (p54, 2005), China attracted more than $69.5 billion in foreign investments during the 2009 fiscal period. The extensive nature of the geographical regions covered by China is supportive of the application of Internet-based electronic commerce businesses that would support the conventional marketing and development approach. With e-commerce aspects, production and processing companies gain the ability to reach the vast population that is distributed over extensive geographic regions. As indicated by Zacks (p76, 2016), the perspective eventually enables an increase in market outreach thus increasing the organization's revenue generation capabilities.

 Focusing on the influential elements affecting e-commerce and economic growth in China Tse (p56, 2015) attributes to the development of infrastructure and user behavior as key elements that brought forth improved e-commerce operations in the state. As such, the exponential growth of the Chinese economy mainly associates with organizations utilizing internet platforms and other e-commerce aspects to improve their business operations thus affecting the positive growth in government revenue. It is also explicit that e-commerce and ICT technologies have brought forth the realization of improvements in employment opportunities in China (Li p87, 2009).

2.2 Aspects Supporting E-commerce in China

The success of e-commerce activities in the Chinese markets mainly attributes to the development of a regulatory framework that seeks to ensure the protection of consumers and the respective sellers. As indicated by the research by Chan (p235, 2009), the impressive performance of electronic commerce operations in the Chinese economy is subject to the mitigation of problems that arise with internet usage. Particularly, the regulatory framework mitigates risks such as counterfeiting and other IPRs infringements as piracy, and counterfeit products are amongst the major concerns that companies face. Winn (p165, 2012) further reiterates that counterfeiting and piracy of products minimize the sales of an organization’s products as well as negatively impacting their brand reputation. The regulatory framework as such limits the piracy of products enabling the attainment of better revenue generation capacities amongst organizations.

The regulatory framework in China further eliminates issues concerning fraud discrepancies with the enforcement of laws that protect organizations and consumers who purchase or sell products through online stores and platforms. Furthermore, Chung (p241, 2011) emphasizes that regulatory framework addresses existing uncertainties regarding over-regulation policies affecting the market. For instance, in 2011 the Chinese Ministry of Culture implemented regulations affecting online gaming activities thus eventually affecting organizations operating in the gaming industry (Winn, Baker and Barnes 112, 2011).  Facilitating the support for online operations, the Chinese government has integrated policies such as tariff quotas thus supporting businesses that want to venture into the sector. The various government policies as well attract foreign organizations seeking to invest in the market due to the vast population in the region. According to the research facilitated by Martinsons (p573, 2012), e-commerce provides dynamism into organizations thus improving employment opportunities. With this perspective in mind, the Chinese government utilizes strategic economic policies that attract foreign and domestic organizations to venture into the Electronic Commerce sector thus facilitating the realization of improved economic conditions as well as the creation of employment for Chinese citizens.

To facilitate support for foreign investments and the operations of external organizations, the Chinese government has formulated integral policies and legal structures such as cross-border e-commerce and the provision of retailing networks. Lei and Wang (p450, 2009) emphasize that the cross-border electronic commerce enables organizations to export products into China with convenience regardless of lacking a subsidiary organization in the domestic market. However, international organizations as dictated by the legal structure should have domestic customer support services (Zhu and  Kotz p45, 2011). The promotion of external foreign corporations is also exemplified by the use of tariffs that seek to lower taxes incurred on the imports. The legal structures and policies promoted by the government as well entail the creation of organizational trademark thus improving the operational capabilities of the business.

2.3 Impact of E-commerce on Chinese Consumption Rates

The transformation of China from an export-led and manufacturing economy to one underpinned by the provision of service and product offerings through online stores and platforms such as Alibaba is thought to have facilitated improvement in domestic consumption as well as economic growth. The growth in domestic consumption as indicated by Burba and Project Management Institute (p243, 2016) is a good prospectus for China and the future of the global economy. In this sense, the Chinese retail market as of the fiscal year 2015 is estimated to cost above $4.6 trillion indicating a decade of double digits concerning revenue collection from the sector. Regardless of the fall in investments, the household consumption in the region exceeds 60% of the national GDP. The fall of growth rate to 10.7% as brought forth by the Blue Book reports, would not hinder the economic development in China as projections indicate that the retail market would rise to above 50 trillion Yuan by 2020.

The research further attributes internet technology and telecommunication innovations as the key drivers facilitating the improvement in domestic consumption rates. Bergsten et al. (p54, 2005) as well infer that the increased investments by the Chinese government on public infrastructures like ports, roads, and airports have brought forth the expansion of the range of product choices available to the Chinese consumers. The prospect of improved infrastructure and internet access has ensured the lowering of costs incurred by consumers while accelerating the delivery time upon purchase. Research undertaken by Chamon and remer (p564, 2016) on internet usage suggests that the internet users in China have risen from 253 million in 2009 to the current 688 million. The statistics exemplified by the scholarly report reflects the progressive innovations that resulted in extensive consumption of products through online purchasing processes.

2.4 China’s Economy and Employment

Despite the existing critics from the Western press on the various obstacles brought forth by Chinese authorities to media and internet operations, China has never been affected by the dot-com bubble” compared to the West. In association to online commerce, the several Chinese websites like Alibaba, Vancl, and Tao Bao have extremely outclassed their Western equivalents such as Amazon and eBay. The research by Lowrey (p145, 2015) indicates an exponential increment in turnover associated with online businesses as Chinese consumers are increasing being attracted towards shopping in online platforms. Particularly, the boom of e-commerce operations in China is attributable to various supportive aspects regarding the concomitant increase in internet usage, the existing propensity of Chinese citizens to buy online, increase in online transactions, and the eventual support of the government.

Specifically, these aspects of e-commerce facilitate the realization of an increase in online sales thus organizations operating through online platforms eventually attain improved revenue collection. The diversification of organizational activities results in the generation of employment opportunities to the Chinese people as most organizations seek to use the increased profits to expand their operations. The conclusive research by Sharp et al. (p145, 2013) as well expounds on the increase in employment opportunities in China as their growing economy and rising domestic consumption rates attracts foreign investments. As such, foreign investments results in the increase in revenue collected by the government through taxation as well as improvement in employments rates thus bringing forth to the growth of the Chinese economy.

2.5 Research Gap

Laying succinct emphasis on the literature review of the study material regarding the research topic, it is evident that various scholarly studies have been undertaken concerning the impacts of electronic commerce and ICT on the Chinese economy. Notably, the focus on the economic growth experienced in China over the past decade provides clarity on the importance of integrating e-commerce into organizational business operations. The review of the literature provides the necessary understanding regarding electronic commerce and information technologies in a global perspective.

2.6 Conclusion

The literature review chapter of this dissertation provides a systematic evaluation of the existing information associated with the research topic. As such, this section of the research provides an analysis of the various aspects relating to electronic commerce and ICT while laying succinct emphasis on the economic growth experience in China.

CHAPTER 3: METHODOLOGY

3.0 Introduction

This section of the dissertation provides a succinct assessment of the various research methodologies that the researcher integrated to the research process. In this sense, the chapter lays emphasis on the research approach, sampling techniques used, design, and other necessary data collection, and analysis techniques. The chapter as well lays out the various ethical considerations that the researcher upheld during the study to ensure its validity and reliability. This research methodology as such involves the gathering of information from specific scholarly articles and documents associated with the research topic “E-commerce and the growth of the Chinese economy.” The process of data collection and analysis was facilitated through the access of website databases used by various Chinese organizations as platforms and store for advertisement and sale processes. The researcher finally provides the necessary justification of the research techniques and methods applied during the research study.

3.1 Research Approach

To facilitate a comprehensive analysis of the various aspects associated with electronic commerce and the growth of the Chinese economy, a mixed method approach was crucial to the research. According to the implicit studies undertaken by (Rojc p156, 2015), the mixed method approach has been useful to various scholars as it facilitates the provision of sufficient information concerning the existing scientific information relating to their topic of study. Particularly, the approach facilitates the improvement of reliability and validity of the information and findings generated by the researcher as it builds upon the concept of triangulation (Webb and Wang p134, 2015). The integration of both qualitative and quantitative data reports under the mixed method approach accords the researcher with advanced and considerably large amounts of information that would be assessed to ensure a better and reliable report. The basic foundation of this methodology approach associated with the fact that the integration of information brought forth from qualitative and quantitative findings permits the completion and development of a synergic report that utilizes the vast amount of information generated from internet sources and other relevant databases.

The research approach further involves the use of an inductive approach whereby the researchers’ efforts and information gathering processes involve an active role thus enabling the development of theories and conclusions necessary for the research on the Impact of electronic commerce in the economy of China. Using the mixed approach of data collection and analysis, the researcher anchors the study on the philosophy of realism therein focusing on elements of constructivism and positivism. The elements indicated to facilitate the improvement of the information collected such that the resulting report is subject to a succinct emphasis on research objectives.

3.2 Research Design

The understanding of the research design is integral to the research study as it enables the researcher to develop a succinct understanding of the processes and methods useful in the collection of relevant data. This element would thus enable the researcher to effectively and logically address the research problem while laying emphasis on the information collected. Notably, the researcher uses an exploratory research design that emphasizes on the verification of the various insights concerning the economic implications of e-commerce in China (Chung p65, 2011). The integration of the exploratory design of the research study as well enabled the researcher to provide implicit strategies and policies that ought to be undertaken by global organizations regarding the use of the internet and ICT technologies (Lowrey p154, 2015). Thus using an exploratory design of research, the researcher had the ability to deduce the various implications of electronic commerce for the marketing and sale of various product offerings.

3.3 Data Collection

3.3.1 Data Collection Techniques

The pragmatic stipulated rationale for using the mixed methods approach to data collection and analysis is brought forth by the assumption that the use of multiple research paradigms essentially contributes to the improvement of data reliability. In this sense, neither quantitative nor qualitative approach methods could explore and capture the necessary information regarding the various aspects of electronic commerce and its influence in the Chinese economy (Martinsons p187, 2012). As such, the data collected regarding the topic of study was enhanced through the assessment of detailed contextual reports from reviewed internet articles, scholarly reports, company materials from government and company databases, news reports concerning e-commerce, press releases, etc.

Using these various online reports and information from company and government databases, the researcher was able to generate both qualitative and quantitative data findings that critically facilitated the generation and assessment of the electronic commerce phenomenon. To ensure the improvement of the data validity and reliability, the researcher conducted secondary research evaluation on the topic of study. This was realized through the investigation of prior government reviews concerning aspects of electronic commerce and why its integration to organizational business operations would essentially facilitate growth. The secondary data collection processes as well involved the extraction of reference lists from scholarly papers as well as the search of relevant information regarding the topic from platforms such as Alibaba and Vancl (Webb and Wang p154, 2016).

3.3.2 Search Strategies

The inference on search strategy associated with the various processes and methods that the researcher used to collect relevant data and information. In this sense, the research study involved the use of a secondary research approach whereby the researcher provides a clear summary of existing synthesized literature on the study. The existence of numerous scholarly report findings related to the study “E-commerce and the growth of Chinese economy,” was supportive of the research approach compared to the primary data collection process that would have required the integration of experiments and interviews (Webb and Wang p45, 2016). The search strategy formulated in this sense sought to ensure the researcher identified the necessary and relevant information that properly exemplify the objectives of the study.

The strategy thus ensured the diversity and generalization of the sources associating to the search terms and databases or websites that ought to be explored. The explicit search terms identified by the researcher to support the study included: Aspects of Electronic Commerce, the growth of China’s economy, Growth Domestic Product, internet and information and communication technologies, Revenue generation through retail stores in China, etc. Therefore, using the search terms as the basis for the research ensured the researcher covered the necessary research questions and objectives as stipulated through the initial objectives of the research (Hempel p54, 2002). The search that was mainly facilitated through Google and other company databases brought forth numerous reports and scholarly studies relating to the economic conditions in China and the use of electronic commerce.

3.4 Data Sampling

 The process of data sampling is undertaken to ensure the researcher makes the necessary inference regarding the significance of each source related to the topic of study. The essential sampling method that the researcher sought to use was the purposive sampling technique whereby the sample selection procedure entailed the choice of a source of the knowledge and data contained (Emodi p189, 2015). In this sense, the selection of the sources was under predetermined criteria whose foundation emphasized on the study objectives and the research questions. Through the purposive sampling technique, the researcher was able to critique the significant nature of each source about explaining the various elements of the Chinese economy with the terse association to e-commerce (Zacks p94, 2016). With this in mind, the researcher integrated the purposive sampling technique to critically determine the relevance of each source thus discarding irrelevant sources.

3.5 Validity and Reliability

The reliability and validity of various findings of the research provide a succinct reflection of the credible and dependability of the study regarding providing the necessary information concerning the issues relating to the research proposal (Winn p678, 2006). According to the implicit studies undertaken by Chamon and Kremer (p154, 2016), the enhancement of the validity and reliability of the research requires the researcher to carefully interpret the information facilitated through the various secondary or primary data collection procedures. Notably, using the mixed method approach of data collection with peer-reviewed and scholarly articles enabled the researcher to improve the reliable nature of the research findings (Sharp p15, 2013).

3.6 Ethical Consideration

The issue of ethics in a scientific perspective refers to the moral principles and other values that researchers ought to exercise throughout the research life cycle. The researcher in this sense has obligations towards their clients, profession, and respondents thus the need to adhere to ethical standards to ensure the information brought forth through the findings is not subject to disrepute (Williams and Simoff p354, 2006). Therefore, the researcher sought to ensure the compliance of implicit ethical codes especially during the data collection and analysis processes. As exemplified by the research by Rojc (p134, 2015), the processes of data collection, analysis, research procedure, and the credible nature of a study, etc. are the major ethical complications that writers and researchers ought to focus on. In light of the stipulated ethics and values in scientific research processes, the researcher upheld the utmost ethical standards especially about the interpretation of various scholars’ report findings and conclusions.

CHAPTER 4: DISCUSSION AND FINDINGS

4.0 Introduction

This section of the research facilitates the provision of the various findings attributable to the analysis of the data collected by the researcher. The data collected as stipulated through the previous chapter entailed the use of a secondary approach as the researcher sought to explore different internet and database sources. Particularly, the information gathered was from reliable articles, government databases, the various platforms used for marketing and sale of products, and other scholarly studies relating to the various aspects associating with electronic commerce. The assessment of the findings as such allows the researcher to present the issues of electronic commerce implementation in the Chinese economy. The selected sources were critical to the research as they brought forth sufficient data findings that necessitated clarity concerning the various aspects of E-commerce in China’s economy.

The research study facilitated by Lei and Wang (p33, 2009) indicates that e-commerce enabled the realization of innovation in the Chinese economy, the promotion of industrial transformation, and improving the quality of livelihoods with an inclusive society in the region. These aspects of e-commerce are quite portrayed through the Thirteenth Five-Year Plan that emphasizes keenly on the eventual attainment of national economic and social development before the year 2020 (Tse, p145, 2015)). Particularly, the various concerns and challenges exemplified in the business environment of China indicate that the 13th FYP reforms program would usher the improvements in investment and business growth. In this sense, the research findings from the study conducted by Li (p110, 2009) demonstrates that improvements in economic variables and quality of life in China are subject to the integration of e-commerce to organizational operations such as sale and purchasing activities. With supportive evidence extracted from the database of the Chinese government and other platforms such as Alibaba, the study emphasizes on the transformation of the Chinese economy that has been spurred by electronic commerce activities and the influx of foreign investments (Lowrey, p143, 2015).

As indicated by the report findings, e-commerce and increasing investments facilitate the creation of positive business environments that enables the development and access of new sectors in the Chinese markets. Through the integration of electronic commerce aspects to the domestic market, the Chinese government has been able to promote broad and bi-directional openness thus building mechanisms and institutions that are compatible with international trade (Capling p89, 2011). The formulation of policies that are integral to promoting e-commerce aspects encourages the orderly flow of the various production factors both in the domestic and global markets.

Therefore, the implementation of e-commerce in China is characteristic of the formulation of market policies that support foreign companies to venture into the growing economy. It is also clear that electronic commerce has been supportive of an increase in domestic consumption as consumers can access products easily through online platforms without incurring extra expenses such as transportation costs. The increased domestic consumption as indicated by Zhu and Kotz (p254, 2011) has been a major factor that brought forth the improvement in the Chinese economy.

4.1 Economic Growth in China

Over the past few decades especially after the dawn of technological innovation in the 21st century, the Chinese economy has experienced astonishing growth levels that catapulted their markets to be second largest globally. For example, in 1978, the economy in China was ninth thus the government sought to develop the economic reforms program as their minimal GDP of USD 214 billion was unsubstantial for realizing their economic requirements. As indicated by the research by Winn (p35, 2012), 35 years after the implementation of the reforms policy, Chinese nominal GDP improved substantially to $9.2 trillion. Before the implementation of electronic commerce, the Chinese economy was mainly supported by their manufacturing hub that comprised construction and industrial industries. Thereby, the Chinese modernization prospectus propelled the tertiary sector as seen in 2013 economic data findings that indicate that the sector was the largest in China’s GDP with a share index of 46.1% (Kremer and IMF p120, 2016). He standard of economic development in China is supported by stimulus though the frequent transitions experienced in the domestic as well as global markets as indicated by the research by Chung (p145, 2015 shows that the stimulus would be dropping by 6.1% in 2018.

The economic growth experienced in China as brought forth by numerous scholarly reports is attributed to their retail markets that are subject to the implementation of online business operations through e-commerce. According to Ma (p254, 2017), the global retail markets as indicated by economic data in the fiscal year of 2015 showed resilience regardless of existing uncertainty concerning the stability of the global economy. The emerging markets such as China and India are thought to have been supportive of the global economic growth. The extensive consumer market and rapid development experienced in China enabled the country to acquire the largest shares regarding global online retail markets. For instance, online retail market analysis report by Chan (p320, 2011) suggests that the growth of the Chinese economy and its large customer base has enabled online sale platforms such as Alibaba and Vancl to surpass other Western-based retail platforms such as eBay and Amazon. The minimal growth levels experienced on online retailing in developed markets in Europe and Northern American states makes the e-retail markets in much attractive to foreign investments. Economic forecast brought forth by OECD indicates that China would realize over 50% growth in the economy by 2018 due to their control of e-retail markets both domestically and in the global market.   

The chart above is a representation of the industrial growth in the Chinese economy since 2012 with corresponding assessments on the investments input into the market. The decline is subject to the existence of monopolistic variables concerning the supply and production of commodities.

The emerging markets in China as brought forth by a detailed report on e-Marketer are becoming a significant growth driver in the global retail markets. The sales registered in 2015 in the global retail markets was $22.5 trillion, and as indicated by Sharp (p123, 2013) the data was subject to a yearly growth rate of 5.6%. Particularly, the emerging markets such as China’s market have been the main retail markets driving force. With the Chinese emerging e-retail market, the compound annual growth rate (CAGR) from 2014 to 2018 is stipulated to maintain a growth level of 8.7% with totaled sales exceeding $5.2 trillion annually. The 2015 data findings as reported by e-marketer shows that the Chinese economy took up 20% of global retail markets share thus contributing to more than 37% of the global retail markets growth.

The graphical representation above presents a comparison of the growth in online retail markets in various countries. China’s robust growth in e-retailing as indicated commenced after 2008 whereby the government and most organizations sought after e-commerce thus enabling easier accessibility of their product offerings through online platforms.

According to the studies conducted by Lei and Wang (p254, 2009), the rapid growth rates experienced in global retail markets could be attributed to network retailing. The speculations brought forth by industry insiders suggest that the global online markets would maintain rapid growth rates and might reach targeted revenue of $3.58 trillion by 2019. The dynamic nature of the Asia Pacific markets that is China and Japan being the fastest globally growing online retail markets would have a greater controlling percentage especially regarding the sale of products in international market ventures (Bergsten and Institute for International Economics p154, 2005). As indicated by the data from CECRC study, the online market in China took more than 12% in total sales volume of consumer products in 2015; this proportion was expected to rise above the limit of 13.5% in the fiscal year of 2016. Therefore, it is clear that with the integration of electronic commerce and ICT technologies to the Chinese economy in 2008, the nation has been able to retain an annual growth rate of GDP of over 6.7%. E-commerce has enabled the various organizations operating in the Chinese market to manipulate the vast customer base brought forth by the large population diversity in the country thus facilitating the attainment of improved revenue collection.

Region Proportion of market (retail)

China 13.5%

Asia-Pacific 12.4%

North America 7.7%

Western Europe 8.2%

Global 8.6%

The table represents the expected regional online market share in retail operations in 2016 after succinct consideration of the 2015 data.

4.2 Development of China’s Retail Market

The continuous growth of the e-retail market in China is the major driver for exponential economic growth in the region. The significant decline in growth rate amongst major physical retail organizations is subject to the decline in the volume of sales in the Chinese retail markets over the past five years (Chung p134, 2011). As indicated by the data formulated by the Chinese General Chamber of Commerce (CGCC), the growth rate of sales in Chinas’ major retailing enterprises hit close to the zero level in 2014 and sales were worse in 2015 whereby some organizations even registered a negative value on sales. Contrary to the analysis, Deloitte Research reiterates that the online retail markets contributed to over 34% of growth in China’s retail markets during 2015, representing a double increase in percentage compared to the growth of 19.65% registered in 2012. Although the economy registered an overall decline in growth rates, the online retail markets in China still experience exquisite growth levels than the growth levels experienced by the retail markets. This as indicated by the research by Burba and PMI (p56, 2016) is attributable to the ever increasing internet users who eventually bring forth the increase in online purchasing power.

Online retailing activities brings forth to the standardization of business operations, reversal of market composition, and the eventual use of mobile terminals as mainstreams for transactions (Grant and Bakhru p112, 2004). The C2C business model as indicated by the studies by Zacks (p159, 2016) was the starting element in the promotion of rapid growth rates in China’s markets concerning the online retailing market. Over the years, the maturity of the electronic commerce aspects in the market has brought forth the attainment of standardized, diversified, and quality market and product development. Further, the transaction scale contribution by the B2C markets facilitates greater accountability to market growth levels compared to the C2C model. As exemplified by the I-Research data statistics, in 2015 transactions of B2C markets experienced exponential rise by 56.6% while the C2C business model only rose by 19.5% thus an indication of the overall growth in a retail market that B2C model contributed.

The existing diverse research by Hempel (p80, 2002) on internet usage mainly emphasize on connectivity with their data indicating the existence of more than 3.2 billion users in 2015. The users of the internet in China as brought forth by the research exceed 700 million, a representation of the combined users of the US, Japan, and India. The connectivity levels existing in China is high thus lowering the knowledge and information gap and enables the eventual growth of routes in business and trading activities (Fariselli and Oughton et al. p272, 2009). The connectivity ratio on internet usage impacts the organizations producing the products as well as consumers through the online retailing operations (Zhu and Kotz 74, 2011). The rise in e-commerce operations and eventual growth in the Chinese economy is equitably associated with high connectivity to internet users as the access to the vast number of internet market enable micro, small and medium (MSME) enterprises to compete on a global scale without incurring costs of establishing operational premises or transportation.

For instance, the success of the Alibaba organization in the Chinese market is attributed to the use of integral and structure e-commerce systems. The e-retailing firm used innovative methods to create comprehensive and self-contained electronic commerce aspects. The table below provides a comprehensive type of services provided by the Alibaba’s One Touch platform:

Name of Service

Description

Financial Services

Provides sellers with financial assistance through means like credit financing

Logistics Services

Shipping, international express services, road and air transportation services

Integrated Cross-border services

Clearing, customs, tax rebating, foreign exchange, and comprehensive export services

Notably, the maturity of technological innovations has been a relevant issue in enabling the eventual attainment of growth in the economy of China through online e-tailing business operations. The use of smartphones, for instance, has resulted in the generation of various e-commerce payment processes thus customers no longer have to have cash on them when purchasing products. Therefore, with innovations in the production, telecommunications, and service industries, China has been able to facilitate improvement in their economy at ease.

4.3 Conclusion

Through this chapter, the researcher can facilitate the systematic review of the findings of the study undertaken. Particularly, the review of the findings shows that the economic growth experienced in China is subject to the integration of electronic commerce into the market. The e-retailing market is exponentially growing because of electronic commerce and the rigorous innovations occurring in the telecommunication and production industries.

CHAPTER 5: CONCLUSION AND RECOMMENDATIONS

5.0 Introduction

The research objective of this study was to facilitate the assessment of the influential aspects associated with the integration of electronic commerce to business activities. The research emphasizes on the Chinese economy that was attributed to exponential growth due to e-tailing markets. In particular, the researcher provides a succinct understanding of the emerging issues in the Chinese production, communication and marketing sectors that exemplify on the significant nature of e-commerce to the economy. Through the integration of a mixed method approach of study, the research incorporates secondary data obtained from a government database, organizational websites, as well as internet articles and journals that are reviewed by scholars. In this sense, the relevance of the data collected from the various journals and articles concerning global electronic commerce aspects were essentially critiqued using a thematic format thus improving on reliability and viability of the sources to the topic of study.

5.1 Linking with Objectives

Laying emphasis on the stipulated objectives brought forth in chapter one, the researcher undertook the necessary and ethical steps to ensure the analysis of the data generated from the mixed method approach were subjectively related to the research question. The various objectives were critical in providing the understanding and the analysis of the underlying issues regarding electronic commerce and information technology in association with the growth of China’s economy. The formulation of the objectives for the research allowed the researcher to develop clarity concerning the research question and theme, thus facilitating the eventual realization of the research scope and purpose. Notably, the initial objective concerning the role played by electronic commerce and information technology in the economy of China especially after 2008 critically enlightened the researcher on the nature of the Chinese economy and its dependence on e-commerce activities. The other objectives brought forth a succinct overview of the prospects of electronic commerce in China as well as about the global economy. In this case, the researcher laid emphasis on providing an analysis of the economic conditions in the state thus focusing on elements concerning the improvement in economic growth as well as an increase in revenue generated by the government through e-tailing activities. Alternatively, providing clarity on the issue of electronic commerce and technological innovations in the business environment allowed the researcher to analyze the market variables existing in the production and distribution industry.

The focus on these objectives as well enabled the researcher to bring forth issues regarding the growth of both domestic and foreign companies participating in the market especially considering the exponential growth of internet usage in China. Particularly, the focus on the objectives ensured the researcher utilized the information gathered from the various secondary sources to provide a succinct analysis of the various factors associating to the advance of Information technology in the Chinese market. As such, through the objectives, the researcher can provide the necessary alignment of the various data collected on the research question.

5.2 Limitations of the Study

The high dependence on secondary information undermined the credibility of the researcher because of the lack of primary sources of information. The reliance on secondary information is characteristic to weakness as the researcher lacks first-hand information. The interrogation of the local Chinese citizens through interviews and questionnaires regarding the study of the topic of study would have essentially generated first-hand data concerning the economic conditions in the region while associating with electronic commerce. Alternatively, the researcher would have essentially improved the viability of the data collected from the research study if they had conducted explicit interviews with the organizations and employees working in production and service industries (Molla and Heeks p143, 2015). It is also evident that other constraints that limited the research were the availability of sufficient timeline of study as well as the lack of financial assistance. These factors as such limited the researchers’ ability to undertake clearly the gathering and analysis of comprehensive information affecting the global economy as well as the influential elements in the Chinese economy that brought forth growth and development.

5.3 Lessons Learned

            Through the analysis of the comprehensive information gathered through the various study materials concerning the Chinese economy and the various impacts brought forth by the implementation of electronic commerce, I have been able to understand clearly the corresponding impacts of electronic commerce and ICT. The global business environment requires the utilization of electronic commerce, telecommunication, and internet marketing aspects that would facilitate the growth of e-tailing platforms such as Alibaba to capitalize on the ever-expanding Internet population (Winn, Baker and Barnes p134, 2011). The analysis as well provides the impact that stability concerning political and social organization have had on the economic conditions of a region. The maintenance of high-security standards in a nation is essentially critical in facilitating the growth and development of the region as insecurity is unsuitable for business operations especially the development of trust considering the security issues that most buyers have. In this sense, the improvement in economic conditions in China is not only associated with the integration of electronic commerce but also the suitable political conditions in the region and large customer base due to the Chinese population.

5.4 Recommendations

The undertaking of the research concerning the improvements in the economic business environment in China provided succinct considerations that indicated the existence of a perfect association between the growth of the economy and the utilization of electronic commerce in business operations. Particularly, the revenue generation capability of the nation was subject to the reliance on business variables like production, global marketing and exportation of products, and the allure of foreign investments (Sanayei p32, 2003). The Chinese government as stipulated by the numerous research sources collected utilizes adequate capital to invest in the electronic, ICT and production sectors that are often integral to economic growth.

Addressing the rising economic issues and the declining oil prices, the following recommendations could be essential to the Chinese government. The government ought to ensure the increase in capital allocations towards the improvement of activities associated with the expansion of internet marketing thus improving the effects that e-commerce has on the realization of economic growth. This strategy would increase the products transported to global markets thus increasing the revenue generated. It is also crucial for the government to improve the security standards in the nation by integrating policies that aim at mitigating the various activities associated with increasing black-market and other gang activities. Focusing on the element of improving security, the state would be able to attract foreign investments to the oil sector thus improving their production capacity. The elimination of issues concerning corruption would as well aid improve the economic conditions in the region. The government, in this case, would be able to mitigate the rising trends concerning the black marketing of products while providing a suitable business environment that would suit foreign investors.

5.5 Conclusion

To conclude on this research study, it is imperative that the improvement in the Chinese economy, as well as the global economic conditions, is subject to the improvement in internet use through marketing and e-tailing marketplaces such as The Alibaba. In spite of their dependence on production and the export of products to the global market, China improved their economy mainly because of the improvement in their domestic consumption as their citizens purchasing products and services from online platforms improved significantly by over 60% after 2011.

As emphasized in the report, the integration of electronic commerce into the business environment is lucrative especially to the companies participating in the various e-tailing marketplaces such as B2B and B2C (Zerdick and European Communication Council p114, 2004). The government as well is subject to benefit from the business operations undertaken through online platforms due to the increase in sales that correspond with increased revenue generation. The nature of the Chines market as well acts as an attraction for external foreign investments from global corporations who eventually facilitate the creation of employment. The factor of implementing improvements in the use of electronic commerce would improve the revenue generated as well as reduce the high unemployment rates that are currently experienced major nations due to the financial crisis.