Babyonline: Leveraging Cross-Border E-Commerce
(9 pages of text)
In June 2018, the wedding dress industry in Suzhou, China, was confronted with "the harshest clampdown," which required all unqualified wedding dress factories to move out within one week. The initiative from the local government had been expected, although its speed and force were surprising to the founder and chief executive officer of Suzhou Beibao E-Commerce Co. Ltd. (Babyonline). Established in 2012 and engaged in cross-border e-commerce of wedding dresses, Babyonline was unlikely to be affected by the clampdown. However, changes across the wedding dress industry as a result of the initiative had started the founder thinking about issues in the management of his company. At the end of 2015, Babyonline had moved to a make-to-stock system, which lowered costs but seemed to have raised inventory issues. Particularly in recent times, selective selling by some sales representatives had led to structural inventory problems. The founder wondered how he should resolve the inventory issue.
This case is suitable for an undergraduate- or graduate-level course on international business, international management, or international entrepreneurship. Students will consider critical topics on the internationalization of small and medium-sized enterprises (SMEs), especially in the online export industry, covering such topics as the analysis of business models, competitive advantages, and strategic changes. After working through the case and assignment questions, students will be able to
- describe the business models of e-commerce SME exporters in emerging economies;
- analyze the competitive advantages of Chinese e-commerce SME exporters based on the STORM (social, technological, organizational, regulatory, and market) framework; and
- explore competitive strategies of companies, strategic changes, and new market entry strategies.
United States; China, Medium, 2018
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