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project findings | PROJECT OUTLINE |

Multinational retailers in the Asia Pacific

Rising prosperity and a rapidly commercialising economy have transformed China
into the world’s most important emerging market. Multinational retailers have
rapidly expanded their presence in China since foreign participation in the sector
was permitted in 1992. This project explored the extent to which retailers from
the UK and Japan transferred their parent country management practices and
retail concepts to Chinese subsidiaries and how local employees and customers
responded to them.

This project ran from April 2003 to April 2007


 

image illustrating findings

Click to view this project's findings summary sheet>>


Project team
Jos Gamble award holder
Qihai Huang

Contact
Dr Jos Gamble
School of Management
Royal Holloway, University of London
Egham
Surrey TW20 OEX

+44 (0) 1784 414094

j.gamble@rhul.ac.uk


Publications

Gamble, J. Multinational Retailers in China (Basingstoke: Palgrave, forthcoming, 2008).

Gamble, J. ‘The Rhetoric of the Consumer and Customer Control in China’, Work, Employment & Society, 21 (1) (2007), pp.7–25

Gamble, J.(2006) ‘Multinational Retailers in China: Proliferating “McJobs” or Developing Skills?’, Journal of Management Studies, 43(7)(2006), pp.1463–1490.

Gamble, J. ‘Introducing Western-style HRM Practices to China: Shopfloor Perceptions in a British Multinational’, Journal of World Business, 41 (4) (2006), pp.328–343.  


 

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Project outline

The following is the text of the project's original proposal


SUMMARY

It is timely to focus upon the transfer of business practices and retail concepts by British and Japanese multinational retailers to their subsidiaries in China. In the past decade the globalisation of retailing has become more pervasive, with the Asia Pacific a key destination for many firms. Japan, despite its hotly debated economic problems, is still the world's second biggest economy and Asia's largest consumer market. Meanwhile, rising prosperity and a rapidly commercialising economy have unleashed an unparalleled consumer revolution and transformed China into the world's most important emerging market. Multinational retailers have built up their presence in China since foreign participation in the sector was permitted in 1992. This investment is likely to increase substantially now that China has acceded to the World Trade Organisation and controls that have limited foreign investment in the sector are due to be removed by 2005.

China's rising popular consumerism has been accompanied by substantial shifts in both notions and expectations of the 'consumer'. Through their introduction of novel and qualitatively different approaches to retailing and customer service, foreign multinational retailers have been at the forefront of this process. This project will investigate and analyse the transfer of management practices and retail concepts by multinational retailers from the United Kingdom and Japan and explore the ways in which these are communicated to, and consumed by, Chinese employees and customers. The research locations selected include four of the world's major cities (Beijing, Tokyo, Shanghai, and London). It will provide rich and abundant material to help understand and conceptualise the specificities of the contemporary metropolitan consumer cultures of China, Japan, and the UK.

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BRITISH AND JAPANESE MULTINATIONAL RETAIL FIRMS AND THE DEVELOPMENT OF CONSUMER CULTURE IN CHINA

China's emergent consumerism has been accompanied by substantial shifts in both notions and expectations of the 'consumer'. This research will explore the impact of multinational retailers on the development of consumer consciousness. For example, how do Chinese customers perceive the relationship between themselves and stores? Is this changing? Does the nationality of the store affect these perceptions? How aware are customers of the different national origins of stores? To what extent does 'Britishness' or 'Japaneseness' permeate and trickle down firms' hierarchies and then to local customers? Do people's rights and expectations as consumers spill over into other dimensions, such as in their own employment or family relations, and between themselves and the state?

Detailed study of the domestic operations and direct overseas subsidiaries of retail companies and their customers and employees at a total of sixteen stores in a range of locations will enable systematic cross-store, cross-national and intra-national comparisons to be made for key variables. The research will seek to document and analyse differences between the business structures, management practices, and retail concepts of retailers from the different countries and to explore topics such as: How do they perceive 'the customer'? Does this differ between Japanese, Chinese and UK firms? Are there systematic differences between the foreign firms and domestic retailers?

The data gathered will be utilised to develop empirically-grounded hypotheses on the impact of multinational retailers on the development of consumer culture in a developing country, contribute to theoretical debates that compare the transferability of business practices of firms from different parent countries, and provide insights into changing labour-management systems in China and Japan.

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KEY QUESTIONS

The main questions dealt with by the project are:

  • What are the main differences between the business structures, management practices, and retail concepts of retailers from different parent countries?
  • Do firms transfer their home country management practices and retail concepts to their operations in China, and to what extent is this transfer influenced by specific institutional and cultural factors in the host country?
  • What impact are multinational retailers having on local employment practices and on the development of consumer culture in China?
  • How do notions of the 'consumer' differ both intra- and cross-culturally?

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APPROACH

The intention is to produce detailed, qualitative and contextualised case studies of workplaces in multinational retailers. In the United Kingdom and Japan, research work at corporate headquarters and eight retail stores will provide the basis to understand parent country practices. More intensive research will be undertaken in China at eight British and Japanese invested stores as well as locally-owned stores in four different cities, Beijing, Shanghai, Chengdu and Shenzhen. Background data on the regulatory framework of the retail sector, local labour markets, and the competitive environment will be collected through library research and interviews with local and national government bodies, consumer associations, business and trade associations and embassy and consular commercial attachés.

The project will merge the skills, techniques and 'bottom-up' perspectives of anthropological style research with management studies insights into business strategy and structures. Data will be generated using various approaches including ethnographic participant observation, survey-based questionnaires, and interviews with customers, local employees and expatriate staff. The direct comparison of actual workplaces means that the variables of business sector and company are both held constant, allowing these aspects to be largely discounted in the analysis. The geographically and sociologically diverse research locations constitute ideal sites to compare the extent and influence of both national and sub-national cultural and institutional differences.

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OUTCOMES

The project will provide a substantial and valuable body of knowledge on the economically and socially significant retail industry and its operations in a region that constitutes a vast and growing consumer market. The data will enhance understanding of the indigenisation of transnational and foreign products, specifically management practices and retail concepts, from the economically developed nations of the United Kingdom and Japan to China, a nation undergoing a transition from a production driven command economy to a consumer-led market economy. This project will also provide valuable insights into the nature of human resource management in British, Japanese and Chinese retail firms. The research will enhance understanding of the ways in which the nature of work is changing in these countries and the consequences of this.

The knowledge and understanding gained from this research will be of value to government and quasi-governmental agencies with an interest in the subject, as well as to managers and the higher education sector in general. Retailing is the UK's top service sector industry, and many UK retailers are expanding internationally. Despite this, with a few notable exceptions, British retail firms have been relatively slow to enter both China and Japan. The inclusion of UK managed stores in this project will contribute to knowledge and understanding of British firms' approach to overseas operations and increase the utility and relevance of the research findings to UK-based user groups.

The dissemination of the findings from this project should help to encourage and foster UK investment in Asia Pacific markets. The comparative study of companies from three different countries will highlight divergent approaches and help to illuminate the parameters of what constitutes 'best practice' in such operations.

 

 

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