COMPANY PROFILE -Vipshop
Business Sector :Retail E-commerce
Operating Geography :China, Asia, Global
About Vipshop :
Vipshop is a Chinese e-commerce company that specializes in online discount sales and manages the website VIP.com (previously Vipshop.com). The company is headquartered in Guangzhou, Guangdong, China. In 2008, December Vipshop.com went online. The Company provides consumers in China with high-quality, well-known branded products at a significant reduction from retail rates. Vipshop has proved that it can bring great size and profitability when compared to traditional online marketplaces or large-scale multi-category online shops. The firm has pioneered the online discount retail model in China by giving special deals and deep discounts on branded products and has established itself as the expert and leader trusted by both customers and brand partners. Over 20,000 brands have partnered with VIP.com, servicing more than 300 million consumers across China; more than 2,200 brands have created unique online partnerships with VIP.com. In May 2021, the company held a 'flash sales' promotion on limited-quantity merchandise and services, which drew a large crowd of bargain hunters.
Vipshop's Unique Selling Point or USP lies in it being China's third-largest e-commerce site and being ranked No. 1 in China's online discount sector.
The company's mission statement reads, "Improving the quality of life and enhancing experience of happiness” at this ever-changing age, Vipshop devotes itself to driving innovation and transformation to create greater value for consumers, partners and the society".
Vipshop Revenue :
USD14,757 million - FY ending 31st December 2020 (y-o-y growth 9.65%)
USD13,458 million - FY ending 31st December 2019
Competitive Analysis of Vipshop
The SWOT analysis for Vipshop is presented below in a matrix followed by the detailed analysis report:
Strengths | Weaknesses |
1. Partnership with major brands for first mover advantage in flash sales
2. Superior inventory and logistics management system
3. Strong financial performance on returns
4. Designed excellent customer experience for shopping
5. Highly engaged and loyal customer base
| 1. Ability to meet short term financing is significantly low
2. Regulatory probes for internal corruption and anti-competition underway
|
Opportunities | Threats |
1. Massive growth potential in China’s online retail market
2. Fast growing trends represented in Chinese offline retail market
3. Pandemic has created a surplus in Chinese retailers’ inventory
4. Remote area infrastructure development has paved way for e-commerce in rural China
| 1. Growth pace hindered with high competition in Chinese retail
2. Impact of China- Hong Kong conflict on business
|
Vipshop SWOT and PESTLE Analysis PDF Report is a custom report and will be delivered to your email inbox within 2 business days from purchase.
Detailed SWOT Analysis of Vipshop
Strength
1. Partnership with major brands for first mover advantage in flash sales: Vipshop offers a unique flash sale shopping model for its customers. With daily featured sales consisting of carefully selected styles and popular branded products. As of December 2020, Vipshop had 440 million registered members shopping with 21000 brand partners and many leading brands, including 35000 popular international and domestic brands. This considerable brand portfolio allows Vipshop to create a unique flash sale experience with a first-mover advantage. Furthermore, many brands prefer to have a limited number of partners capable of scalable implementation for flash sales for many customers. Vipshop, with large-scale operations and customized e-commerce infrastructure, fulfills such huge demanding sales. The company estabished exclusive partnerships with brand that gives it the first-mover advantage to sell styled merchandise and attract customers.
2. Superior inventory and logistics management system: In order to handle daily flash sales held in association with Vipshop’s partner brands, the company has developed a superior inventory and logistics system. They use a digitized ERP (Enterprise resource planning) system to monitor sales actively. The inventory management is designed explicitly for flash sales and can handle large volumes of merchandise within a short period. It helps both partner brands and consumers. Partner brands can monetize a large number of products within a short period while the consumer gets the best price. At no time does the company engage in inventory risk; 90% of the goods it holds are for shipping purposes. Goods that are not sold are returned to the concerned brand. The e-commerce giant handles its customers’ entire load efficiently; 90% of the orders are delivered through a proprietary last-mile network. Vipshop also provides the brand with a channel for marketing products. It provides them with consumer data analytics as well. To efficiently manage inventory, Vipshop has a policy of 7-day no-exception return for its customers in case of discontentment.
The remaining section under "Strength" is available only in the 'Complete Report' on purchase.
Weakness
This section is available only in the 'Complete Report' on purchase.
Opportunity
This section is available only in the 'Complete Report' on purchase.
Threat
This section is available only in the 'Complete Report' on purchase.
The PESTLE analysis for Vipshop is presented below in a table followed by the detailed analysis report.
Political | Economical |
1. Removal of special status of Hong Kong will affect export business
2. Chinese government is focusing on increasing domestic supply and self-sufficiency
| 1. China’s five year plan promotes development of e-commerce |
Social | Technological |
1. Online shopping has risen post pandemic in China
2. Increased expenditure on mass market goods by low income groups
| 1. Use of new technologies to make business sustainable |
Legal | Environmental |
1. China stiffens competition regulations in e-commerce market
2. China’s advertising laws turn strict post pandemic
| 1. China’s evolving environmental regulations put focus on green supply chains
2. E-commerce companies in China commit to use clean energy and reduce carbon footprints
|
Vipshop SWOT and PESTLE Analysis PDF Report is a custom report and will be delivered to your email inbox within 2 business days from purchase.
Detailed Pestle Analysis of Vipshop
Political
This section is available only in the 'Complete Report' on purchase.
Economic
This section is available only in the 'Complete Report' on purchase.
Social
This section is available only in the 'Complete Report' on purchase.
Technological
This section is available only in the 'Complete Report' on purchase.
Legal
1. China stiffens competition regulations in e-commerce market:The fast-growing e-commerce landscape in China with organizations such as Alibaba, Tencent, Baidu, JD.com, Vipshop, etc., has caused anti-competition practices to soar. Unfair discounts to varied market penetration strategies, indeed spell trouble. In Nov 2020, the state administration for market regulation had issued anti-monopoly guidelines for e-commerce platforms. All digital platform companies were to follow a set framework and were prohibited from asserting market dominance to attract customers. Furthermore, the guidelines state that vendors would be permitted to select only one e-commerce platform for their merchandise sale. This will reduce competition amidst e-commerce platforms based on pricing strategies for vendors. The guidelines even prohibit using Big Data Analysis techniques to determine the price of products; this means e-commerce companies cannot change the price of products based on demand levels and regions. Currently, Vipshop uses data analysis for inventory management, it supplies customer transaction data to brands to develop sales and marketing strategies; this new guideline could act as an impediment to its data analysis practices.
The remaining section under "Legal" is available only in the 'Complete Report' on purchase.
Environmental
This section is available only in the 'Complete Report' on purchase.
Major Brands :
- Vipshop International Holdings Limited
- Vipshop (China) Co., Ltd.
- Vipshop (Kunshan) E-Commerce Co., Ltd.
- Guangzhou Vipshop Information Technology Co., Ltd.
Vipshop SWOT and PESTLE Analysis PDF Report is a custom report and will be delivered to your email inbox within 2 business days from purchase.
TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?
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Vipshop Segmentation, Targeting and Positioning (STP) Analysis |
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Vipshop Ansoff Matrix Analysis |
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References used in Vipshop SWOT & PESTLE Analysis Report
1. The Customer Advantage | Vipshop Holdings Ltd. - https://ir.vip.com/customer-advantage
2. Vipshop Holdings Ltd Form 20-K - https://ir.vip.com/static-files/4feacac7-8267-4764-8080-9cb1d7415a37
3. The Brand Partner Advantage | Vipshop Holdings Ltd. - https://ir.vip.com/brand-partner-advantage
4. Vipshop: Bringing discounted retail e-commerce to China - https://digital.hbs.edu/platform-rctom/submission/vipshop-bringing-discounted-retail-e-commerce-to-china/
5. Vipshop Holdings Ltd. Investor Presentation August 2020 - https://ir.vip.com/static-files/1bd8cdd2-eb4c-4ac3-b1dc-d803ea28d5ca
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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Vipshop SWOT and PESTLE Analysis has been conducted by Rakesh Shewale and reviewed by senior analysts from Barakaat Consulting.
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