Improving the Overall Profit MarginSetting Up ECommerce Sales Platform in Huitong Trading Company

《Improving the Overall Profit MarginSetting Up ECommerce Sales Platform in Huitong Trading Company》由会员分享，可在线阅读，更多相关《Improving the Overall Profit MarginSetting Up ECommerce Sales Platform in Huitong Trading Company（38页珍藏版）》请在装配图网上搜索。

1、Improving the Overall Profit Margin by Setting Up E-Commerce Sales Platform in Huitong Trading Company摘要惠通经贸有限公司成立与2000年，是全国最大的进口水果进口商，还是2008年北京奥运会进口水果唯一指定供应商。但是惠通公司在主营业务上的低收益率却偏低， 2010年全年的净利润率仅为0.25%。在整个进口水果产业链中，惠通作为进口商，只是国外上游供应商和国内二级经销商之间的一个“搬运工”，而进口水果大部分利润，都掌握在那些掌控着消费终端的二级经销商手中。作为公司销售经理的我对此深有体会。随

2、着中国互联网经济的飞速发展，中国已经成为网络购物使用者的国家之一。再加上政府提出要积极发展电子商务、网络购物，以促进互联网经济的持续发展。由此本文本论文提出假设，通过建立进口水果的电子商务零售平台，整合惠通现有资源，将进口水果通过电子商务网站直接面向终端消费者销售。从而提高公司的整体利润率，找到新的利润增长点。本论文前期通过调查问卷以确定目标客户群、SWOT分析法等研究方法找出新项目的设计方向。中期在电子商务销售平台的设计和建设过程中，通过项目进度流程表、项目进展清单、项目构架表等检查与评估形式确保计划内容充分执行。后期在电子商务销售平台建成试营阶段，通过财务独立核算，获取相关财务数据，和公司

3、目前主要业务进行对比评估。经过前期仔细的调查分析及切实可行的设计，中期认真的实施和监控，和后期客观评估，使得本论文设计的进口水果电子商务平台顺利建成运营，电子商务项目的净利润率要比公司原有业务高出15倍之多。更是摸索出了一套行之有效的进口水果电子商务销售模式。比尔盖茨说过：21世纪，要不电子商务，要不无商可务。中国政府的“十二五”计划也将发展电子商务作为重要战略，加之当下中国网购市场交易规模高速增长，网购用户稳定增长。这样一种大环境下，进口水果的网上零售必将有很大的发展空间和利润空间。对于惠通公司来说，开辟水果电子商务网上零售业务，有着战略性的意义。关键词： 电子商务 ；网络购物；进口水果 ；

4、利润增长点；AbstractThis BA degree paper presents a detailed report of a project implemented in Huitong Company to resolve the problem of low profitability due to an inappropriate narrow and singular business model concept currently in practice. As existed now, Huitong operates the business model based on

5、 “breakage” whereby company assumes the role of a “porter”. As a result, there have been little technical advantages for the company resulting in low profit margin. In reality, most of profit and gains over the imported fruits lies in the hand of secondary distributors who control the pricing of the

6、 goods and deals direct with end customers. Based on the hypothesis that if Huitong can explore a new business channel, to set up E-Commerce sales platform, and deals directly with end customer. The end results anticipated is the companys overdue profit margin will be increased, the successful busin

7、ess model will pull the company out of current low profit margin predicament. This project was implemented during 1st July to 31st October, 2011. Scientific research methods of questionnaire, brainstorming and SWOT analysis were conducted over the period to identify and analyses expected problems th

8、at may be encountered. A theory cum practice integrated approach was adopted to implement this project. With the efforts of those participated, we achieved our final goal successfully and produced astonishing results. The E-Commerce sales platform has now firmly established and is operating smoothly

9、. We had proven the project hypothesis through offering quality product , price competitiveness, 24 hours order processing system, seamless logistic service and courteous customer service attitudes. The results of the project prove that by setting-up E-Commerce sales platform in imported fruit indus

10、try , it is possible to get significant profit margin is an effective approach, depending on good organizational structure, just in time planning and customer service. As what Bill Gates has said, “in the 21 century, the mainstream is E-Commerce, otherwise there is no business” and our project has p

11、roved his wisdom of prediction. Key words: E-Commerce; online shopping; imported fruits; profit margin; Table of ContentsPages1. Project Introduction 72. Project Problem Identification and Analysis9 2.1 Project problem9 2.2 Problem analysis9 2.2.1 Current situation analysis9 2.2.2 Needs and wants an

12、alysis11 2.2.3 SWOT analysis133. Project Objective and Hypothesis14 3.1 Project objective14 3.2 Project hypothesis154. Project Rationale155. Project Design 17 5.1 Planning of Activities17 5.1.1 Activities with time-scale17 5.1.2 Critical path analysis21 5.1.3 People involved and responsibilities21 5

13、.2 Costing22 5.3 Risk analysis24 5.4 Plan for the monitoring and evaluation of the project266. Project Implementation26 6.1 General introduction of time, place of projectimplementation26 6.2 The working steps of implementation26 6.3 Monitoring277. Results and Discussion28 7.1 Results28 7.2 Discussio

14、n308. Conclusion32Bibliography34Appendix I. Questionnaire35Appendix II. The Income Statement38Appendix III. AS400 Cost & Profit Management Report39Improving the Overall Profit Margin by Setting Up E-Commerce Sales Platform in Huitong Company.1. Introduction Huitong Company was established in 2000 wi

15、th registered capital RMB3,000,000. The main business is importing fresh fruits from overseas and wholesaling to secondary distributors. As the biggest importer of fresh fruits in China, Huitong was appointed as the sole supplier of imported fresh fruits for Beijing Olympic Games in 2008. Huitongs i

16、mported amounts in apples, plums, cherries, grapes and kiwis accounting for about 50% of total imported fruits in China. The company was accredited with AAA by China Foreign Trade Association in 2009 for those companies involved in the foreign trade sector.However, with the growth of the business, t

17、he company has incurred a low profit margin trade . For instance, in year 2010, the companys sale income was CNY399 million, but gross margin was calculated at merely 0.63%, and the derived net annual profit margins only amounts to a miserable 0.25%. I think the main problem leading to low profit ha

18、s been that the business only trades in narrow, selective and sometimes singular lines ie over specialization. In the whole imported fruit supply chain, Huitong only assumes the role of “porter”, with no control over pricing or supply logistics or gaining any technical advantages. In fact, substanti

19、al profit of the imported fruits lies in the hand of secondary distributors who exert whole control on the consumer market .On the basis of the existing business framework, the challenges to Huitong now is to develop a business model paving a more direct access to consumer market, thus increases mar

20、ket share and profit margin. A successful business model is the only way to pull the company out of current low profit margin predicament,In order to implement an E-Commerce trading platform, company has established a new E-Com business division. I was appointed as the manager of this new E-Commerce

21、 Business Division for implementation of the new business model strategy by the General Manager of Huitong. Based on the hypothesis that an E-Commerce sales platform can foster growth and improve profit margin through quality, price competitiveness, 24 hours order processing and streamlining logisti

22、c service coupled with courteous customer service. a two-month experimental project was launched between 1st July, 2011 to 31st Oct, 2011. A series of activities were planned and carried out. Project initiation involved application a start-up capital ; obtaining E-Commerce license from the Industria

23、l and C bureau; outsourcing the website designing and construction; negotiating with third-party logistic companies ( ie logistics service from warehouse to end customer), and orientation training to all staffs involved with E-Commerce department and so on.Before putting the plan into practice, I al

24、so devised some measures to control and manage potential risks, and the framework is a very good tool for monitoring the project.The success factors attributed to this project were that the establishing of an E-Commerce sales platform for imported fruits enabling providing high quality fruits with p

25、rice competitiveness feasible; 24 hours order processing system ; speedily logistic service form placing an order to goods at the doorstep as well a team of well trained dedicated staffs offering excellent customer service.The total cost of the project was 101,500 Yuan. The cost included E-Commerce

26、sales platform designing and construction, third-part logistic service, purchasing computer hardware and accessories, cost-sharing in office & warehouse rental, staffs costs and so on.Throughout the whole process of this project, I adopted those helpful techniques and methods which Feng Yingjian int

27、roduced in his book “Network marketing foundation and practice (2007)”. Scientific research methods of customer survey by questionnaire, and SWOT analysis were used in the identification and analysis of the problems as well as strength. Flowchart, project framework and several other methodologies we

28、re also adopted in the design, implementation and evaluation of project performance. Following on the initial market survey, formulating project execution strategy and final implementation of the business model, we were full of confidence for success. With continual increase in market share, the suc

29、cessful launch of the E-commer platform on imported fruits rapidly becomes a focused profit centre for the Huitong company.2. Problem Identification and Analysis2.1 Project ProblemThe problem I was facing then had been that Huitong company has been trading at low profitability because the companys b

30、usiness operating sector is narrow and singular. In the whole imported fruit supply chain, Huitong only assumes the role as a “porter”, with no command over pricing or business operation. There were no technical advantages for the company doing the brokerage role. Actually, all the tangible profit i

31、s in the hand of those secondary distributors who control the end customer market.2.2 Problem analysis2.2.1 Current situation analysis Financial Status:The financial status of Huitong is quite stable, the companys main business sales income increases year by year. It has demonstrated a growth of 37.

32、5% during the financial year 2010. The sales income has increased from CNY290 million in year 2009 to CNY399 billion in year 2010. On the whole, Huitong has incurred higher cost of goods sold and operating expense during the year 2010, thereby leading to a low profit. Huitongs current and quick rati

33、os are calculated as 1.07 & 0.97 respectively in year 2010. The ratio suggests that the company is in a satisfactory level of liquidity. Huitong has adequate cash flow to support the E-Commerce sales platform strategy, Huitong granted RMB500,000 as the start-up capital of E-Commerce program. The bud

34、get also covers the market research expense.Human resourcesLeading the management team is Mr. Peng Ze, who is the person in charge of Huitongs daily business operations. Mr. Peng is very interested on the E-Commerce program. Under the support of Mr. Peng, the head of the departments from IT, warehou

35、se, logistic, finance, HR & customer service were all involved in this project. In supporting the project , 2 staffs from my sales department and me were involved with customer survey with questionnaire collection and data analysis. Physical resourcesHuitong was established in 2001, and with 10 bran

36、ches in all the major cities across Chiena such as Hangzhou, Nanjing, Beijing, Wuhan, Xiamen, Shenzhen, and Guangzhou. Each branch was equipped with cold storage facility. As the largest fruit importer of fresh fruit in China, Huitong has many “golden” and royal suppliers.PEST analysisWith Chinas ac

37、cession to the WTO, the tariffs of imported agricultural products dropped dramatically. Take the imported fruit as an example, according to the promise made by China government, the average tariff has been reduced from 30% to 10%, with many kinds of fruits enjoy zero tariffs. With a decrease in Tari

38、ff cost, prompting the imported fruits that virtually flies into the ordinary homes from abroad. The reduced tariff , hence lower selling price, will lead to rapid expansion of imported fruits market deep into the Chinese mainland. From the respect of Internet market, as at Jun end of 2011, the inte

39、rnet users reached to 404million, increasing at a stunting rate of 28.9% per year. Very soon the net users in China will competed or even exceed the best of the developed countires. The E-Commerce market transaction volume has reached RMB2.95 trillion in 2011, with Chinas internet buyers stand at mo

40、re than 100 million. .E-Commerce is becoming a fast developing activity in web-based platform for business activities. The market for E-commence is highly competitive in developing countries to enhance the economic strength of the country. E-Commerce commands a unique advantage in the ability of all

41、ocation global resources effectively & efficiently. The eleventh Five-year National Plan regarded E-business as the one of the most important strategies that the country is pursuing. From view of current economic situation and the perspective future trend, E-Commerce has entered an escalating pace o

42、f rapid development. The volume of internet trade has increased in at an astonishing pace with a steady group of web based user group. This is one reason that web-based E-Commerce companies are now enjoying a very high rating by investors. To cope with the rapid development of E-Commerce, Huitong mu

43、st try to seize this unique opportunity , to apply for E-Commerce trade in the fruit B2C sector. This is a excellent chance for Huitong to extend its business channel and improve the profit mkargin. Otherwise, it would be left out of this fiercely competitive but profitable market.2.2.2 Needs and wa

44、nts analysisA market research project looking for factors affecting customers purchase intention through a needs analysis of imported fruit by online sales. The goal is to locking onto target customers and to find out whats their concerns on purchasing imported fruit via the E-Commerce sales platfor

45、m.First, a questionnaire was designed to covering all aspects that were thought to be relevant for a market survey of imported fruit . We took Shanghai consumers as our samples and issued 300 questionnaires. In order to avoid homogeneity problems associated with a same location, we had chosen 5 dist

46、ricts in shanghai to carryout the site survey questionnaires. Finally we received 261 completed questionnaire with significant data suitable for customer attitude analysis. The survey shows that: (1) Women are the most likely population group who may wish to buy imported fruits. The fact is that in

47、the daily life, majority of imported fruit buyers are females of all age groups, and this is because a traditional family, women are the main groups to buy fruits for the family. (2) From the age structure analysis, the age group who most likely inclines to buy imported fruits are those between 19 a

48、nd 35 years old. This data represents 81.5% of the total number surveyed. For the age group under 18 there is only 1.5% responded positively to use the E-commer platform. For those over 60 age group, they represents only 1.5% of the total number surveyed with positive responses. Data concluded that

49、the main buying groups are middle-aged , young and educated. (3) The survey shows that the age group who is willing to buy imported fruits is mainly concentrated in college or above highly-educated population. The result represents 95% of the total number surveyed. This group has better consumer con

50、sciousness and brand cultural identity. They pursue quality of the life and health. (4) In income respect, people with monthly income over RMB6000 are above 80%. (5) from the group (1)-(4), 80% of them with experience of online shopping and willing to accept the mode of trading of imported fruits on

51、line. (6)Main reasons why people prefer imported fruits as to the local produce are that imported fruits have better quality control , with higher safety standards, and the preference for novelty foreign produce. (7) The negative factors on buying fruits on-line are: concern over freshness, delivery

52、 and short of weight. Based on the preceding analysis, its easy to see that： the consumer group mainly are the white-collar, mid-level or high-level groups, with age spanning over 25 to 39 years old range, The proportion of men over women in this category has been 3:7, college or above highly-educat

53、ed population, and this group also represents the backbone of online shopping. An accurate understanding of market position & customer age /educational distribution is the key to a success launch of the E-Commerce on imported fruit sector.2.2.3 SWOT AnalysisStrengths:HuiTong, as the only designated

54、supplier of imported fruits for the 2008 Olympics Games, has very good market reputation and high brand value.HuiTong,as the industry leader, has been operating in the imported fruits business sector with a much early entry. We have branch offices in 10 major provincial cities, all with integrated o

55、rganization and are equipped with cold storages and refrigeration equipment. We are supported with a good base of business distribution network.HuiTong, as the largest fruit importer in China, has more than 50% share of the national total imports of apple, cherry, peaches, grapes, kiwi fruit. Based

56、on this, the E-Commerce platform-YES MY FRUIT, has certain techno-commercial advantages in sourcing and pricing policies, beging the largest fruit importer in China.WeaknessesHuiTong has no experience in E-Commerce before, so we need comprehensive skill training about building new E-Commerce in all

57、aspects.Although we have branch offices and cold storages in central cities, own transport vehicles are mainly engaged in B2B, while a third party is used for B2C business. Because fresh fruit producer has short shelf life, they are easily damaged and demand high degree of attention to maintain fres

58、hness, damaged and rotting fruit, short weight are often caused by third party, leading to economic loss and brand image damage to the company.OpportunitiesAlong with Chinas economic developing trend from that of investment and foreign trade export oreintation towards domestic market development, an

59、d coupling with zero tariff advantages for fruit import from southeast Asia and some countries in Eastern Europe, the future is here. It is anticipated that there will be unprecedented development in quality and quantity of imported fruits within next five years.Chinas E-Commerce has entered into an

60、 escalating pace of rapid development. The volume of E-Commerce trade has increased at an astonishing pace with a steady group of web based user group.Imported fruits with super quality and competitive price will attract much more customers in years ahead.Threats:Yiguo, Bufsun and other online fruit

61、 shops were established earlier. They had gained certain amount of customer base already with future development potential in this sector. . Yiguo is the largest online fruit shop in China at present time .Wal-mart and some other retail stores, TV shopping or even some banks have now trying to enter

62、 the market with their own E-Commerce platforms. Competition is growing in intensity and late entrants are bound to find that entry fees will escalate rapidly. 3. Project Objective and Hypothesis3.1. Project ObjectiveThe problem that I am facing is dealing with low profitability of my company due to

63、 her narrow and singular mode of business model structure. Her main profit is from the low price spreads between the upstream suppler and downstream consumer. As a broker the company has no say over pricing policy and nor business operating control. The goal of my project is set up E-Commerce busine

64、ss division to seeking for new profit points. My objectives are: to integrate and optimize the internal resources, to utilize Huitongs current brand effects, let the E-Commerce sales platform successful and rapidly improve the overall profit.3.2 Project HypothesisIt is hypothesized that if Huitong i

65、s taking a leader position in imported fruits industry but with very low profitability just due to the business mode is narrow and single. By setting up a E-Commerce sales platform, we can overcome the current disadvantage by through direct purchase agreement with supplier and cut price marketing strategy to the cons