【正文】 order value will be 200300 RMB or even more. ?Product: More Item and rich variety should be developed, even electronic device and high value product can also be added to the catalog. ?Transaction: performance of transaction system should bee better, include internal system and out sourcing control, mail order should mean more convenience in China, not more trouble. Seizing the Future: Mail Order Market Potential in China 36 IT supporting System Reinforcing the integrated strength is the key point for Quelle to keep ahead in mail order business In face of the huge potential in China, we suggest that Quelle should loss no time to sharp its petitive edge by additional investment Seizing the Future: Mail Order Market Potential in China 37 Content A. Development of Chinese Retail Market B. Mail Order Market Analysis in China C. Quelle Shanghai SWOT Analysis D. Action Plan and Sales Forecast E. Conclusion Seizing the Future: Mail Order Market Potential in China 38 Quelle is now facing three options regarding investment strategy Quelle’s decision time Inject additional / necessary money and put the management under tight result control Keep the minimum operation and sell it to third party Kill the project and exit ?Chance to win the leader position in a fast growing market ?Sharping the petitive edge ?Risk, if development plan can not be implemented effectively ?Limited cash flow risk ?Key persons will leave pany soon ?Takes time to close the deal ?Some cash injection still needed ?Write off at once ?Loss of all intellectual and intangible assets ?Difficult to reentry again ?Image loss in the industry Seizing the Future: Mail Order Market Potential in China 39 Based on our investigation on market potential, track record, and management ability, we propose Quelle to adapt the more active investment strategy in China, …. Action Field Optimize the cost structure Investment in customer satisfaction Optimize the revenue structure ?Explore the existing list ?Perate new segment ?Administration cost ?Purchasing cost ?Catalog cost ?Delivery cost ?Order handling process ?Order collect ?Agent/service center/show room ?Localization of product ?Website Target area I Target area II Target area III … However the money should be spent in right direction according to a thorough action plan. The operational target of the action plan is to reach break even by the end of 2020. Seizing the Future: Mail Order Market Potential in China 40 Mail Order Potential distribution in connection with retail store density and purchasing power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A B C D E F G H I Retail Store density Purchasing power : Mail Order potential high low high Seizing the Future: Mail Order Market Potential in China 41 Customer analysis A B C D E F G H I Purchasing power Retail store can not satisfy consumer’s demand Active consumer, but face to many choices No value No value No value Active consumer, normal shopping environment high low Retail store density high Less value Seizing the Future: Mail Order Market Potential in China 42 Proposal of Peration Strategy: explore the existing pool and grasp the opportunities offered by traditional retail store A B D E G H I Purchasing power Exist client pool Short Term Target Zone Long Term Target high low high Retail store density C F Seizing the Future: Mail Order Market Potential in China 43 Target customer group potential evaluation: Area 2020 2020 2020Average Order Value A 350 370 400B 200 250 280E 180 210 250C 220 250 300Responsible Rate A 8% 10% 15%B 4% 6% 7%E 2% % 5%C 5% % 7%Contribution to Sales A % % %B % % %E % % %C % % %A: limited area with lots of demand, easily for peration C: Develop loyal customer, petition tough B and E: Decisive for long run success, not easy to develop Seizing the Future: Mail Order Market Potential in China 44 Developed loyal customer group in area C: Build good customer relationship and cultivate the mail order habits, so Quelle can get return earlier from this target segment. 2020 2020 2020Marketing 500,000 200,000 200,000DM 1,000,000 1,280,000 1,500,000Orders 50,000 80,640 105,000Sales Demand 11,000,000 20,160,000 31,500,000Net Sales 7,700,000 14,313,600 22,680,000DM Cost 3,700,000 4,736,000 5,550,000Contribution 3 350,000 1,934,528 4,456,000Contribution to sale % % %Name List 400,000 600,000 800,000?Limited promotion budget is needed for direct munication with customer . ?Purpose: Inspire faithful customer, diffuse useful information, reward the loyalty. ?Launch emotional promotion activity ?Discount with a given quantity of order ?Use BBS to build user group Seizing the Future: Mail Order Market Potential in China 45 Use concentrate resource to develop area A, this customer group can quickly be small cash cow. 2020 2020 2020Marketing 800,000 600,000 600,000DM 65,000 160,000 180,000Orders 5,200 16,000 27,000Sales Demand 1,820,000 5,920,000 10,800,000Net Sales 1,274,000 4,203,200 6,633,814DM Cost 240,500 592,000 666,000Contribution 3 403,500 825,536 2,233,200tribution to sale % % %Name List 65,000 85,000 100,000Developing step: In 2020 develop first 35 cities In 2020 explore 1015 new targets In 2020 develop 510 cities Marketing management: ?Exhibition