Abstract
This case focuses on the emerging online commerce in China’s crop protection industry. Since 2016, many local generic players started to invest heavily in setting up digital business models to fight for market share. Internet giants like Alibaba and JD.com also began to enter the agricultural sector. However, most leading multinational companies such as Crop Protection Group decided to stay out of China’s online business and to solely rely on their traditional retail channels. The company needs to decide on how to deal with the changing business environment to remain competitive in one of the most dynamic and largest agricultural and online markets. Looking at the company’s channel strategy and business model, the challenges and opportunities of electronic commerce are discussed.
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Notes
- 1.
Names of all MNCs and of the main character in the case mentioned are invented. Any parallel to existing companies or people would be coincidence. The focus of this case is the development of a sustainable online channel strategy that could be applied by any MNC rather than an analysis of an individual company.
- 2.
AIs are the part of the pesticides which are “intended to kill or control pests (insecticides, fungicides, herbicides, etc.)” (Joint Meeting on Pesticide Specifications (2016)). The production of pesticides takes place in two major steps. Firstly, the active ingredient is synthesized. This pure and highly concentrated product is usually not suitable for direct usage. Therefore, in the second production step, the formulation process, the AI is combined with other ingredients, which help to improve the chemical and physical properties of the end product, the (formulated) pesticide. Many different types of pesticide formulations exist ranging from gaseous over liquid to solid ones Herzfeld and Sargent (2017). Often the same AI is sold in different types of formulations, concentrations, and brand names.
- 3.
USD/CNY exchange rate used in the case: 6.8495 (as of November 11, 2016).
- 4.
Other English names (translations) for the platform are Nongyiwang, Nongyi.net, and Nong1wang.
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Poetzsch, M., Han, Z. (2019). New Game: Should the Multinational Crop Protection Company CPG Enter China’s M-Commerce Market?. In: Prange, C., Kattenbach, R. (eds) Management Practices in Asia. Springer, Cham. https://doi.org/10.1007/978-3-030-19662-2_6
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