P3:
Describe how the environmental and culture of China affects the international operation of
G-Star.
PEST Analyses of China:
PEST Affect
Political The legal framework for e-commerce in China is still in its early stage. China hasn’t
much experience in e-commerce legislation for topics such as; intellectual
property, rights protection and taxes. There also aren’t any regulations which
support the privacy, consumer rights and validation of digital contracts yet.
The communist party of China is the founding and ruling political party in China.
Even though it is a stable political environment, the lack of political freedom is
doubted.
Economical China is the 2nd largest economy in the world by GDP. However, it is the world’s
largest economy based on purchasing power. Which means consumers spend have
more money to spend on products. Also the labor costs in China are very low which
makes it an interesting country for big companies to manufacture their product in.
having big corporations manufacture and operate from within china will benefit the
Chinese government, because they will have to pay business and personal income
tax.
Social With a population of 1.4 billion people China is the most populated country in the
world. This means there is a huge market for consumer products in China. Also
with the increase in wages people in China have more money to spend. Just like in
another country also Chinese citizens like purchasing status symbols such as;
luxurious cars, latest technology or expensive clothes. There are over 770 million
internet users in China, which makes it an interesting market for foreign online
shops. Tao boa is the largest local e-commerce website in China and many people
spend a lot of money purchasing their goods form it.
Technological With over 770 million china has the largest online population. China has some huge
tech giants like; Alibaba and Tencent these giants make it hard for big companies to
establish themselves in china. China has set a goal for themselves which is to
become the global leader in science and technology. They want to move from
depending on labor to being an innovative economy. However the internet in China
is very different when compared to other countries. The Chinese people do not
have access to specific sites such as Google and the services of Microsoft.
Aspects of the Chinese Culture
Religion
Currently there are only five official religions in China. These are; Buddhism, Taoism, Islam,
Catholic and Protestantism. Any religion other than these is considered illegal in China. Almost
one quarter of the population in China has Taoism and Confucianism and other traditional
, religions as their religion. There are also a small number of people that have Buddhism, Islam or
Catholic as their religion.
Language
There are seven major dialects of the Chinese language with each one having their own
dialects. Almost 70% of the population speaks mandarin which is the usual language. The
second largest spoken dialect is Wu with 8.5% of the population. Other dialects are; Yue, Xiang,
Min, Hakka and Gan.
Food
Just like all the other aspects of the Chinese culture also the food is influenced geography and
ethnic diversity. The main Chinese cooking styles are; Cantonese (mainly stir fried dishes) and
Szechuan (relies heavily on peanuts, paste and ginger). Rise is also a major food source which is
part of the culture and the diet of most of the Chinese people. Chinese people don’t consume a
lot of meat that is why tofu is the main source of protein.
Guanxi
One of the cultural aspects of the Chinese culture is: Guanxi. Guanxi is a Chinese word for
network or connecting. This opens doors for new businesses and facilitate deals. A person who
has a lot of Guanxi will be in a better position to generate business than someone who lacks
Guanxi.
Respect
Another cultural aspect of the Chinese culture is showing respect to age, seniority or
educational background. For example subordinates cannot question the decision of superiors,
because this would be seen as being disrespectful in the Chinese culture.
Cultural aspects which influence the operations of G-Star in China
Products and services sold by G-Star should be acceptable in the Chinese target market
segment. When doing business in China, it is important the Chinese values are understanded.
The approach of marketing is determined by the culture of the people the company is selling to.
The Chinese Guanxi culture affects how marketers of companies are welcomed in the country.
For example, if local Chinese personnel marketed a new jean for G-Star Raw Chinese people
would feel more comfortable compared to when a foreigner would market the same product,
because the Chinese would just see him as a foreigner who doesn’t know anything about the
culture.
In China over 7 languages are spoken. The language which is spoken and used in a country has
impact on the; marketing, brand name, advertising and collection of information through
surveys and interviews. For G-Star to succeed in China it is important that they market their
product in the correct language which is spoken in that area. For example if G-Star wants a
store in Beijing the employees need to speak mandarin also the local advertisements and
Describe how the environmental and culture of China affects the international operation of
G-Star.
PEST Analyses of China:
PEST Affect
Political The legal framework for e-commerce in China is still in its early stage. China hasn’t
much experience in e-commerce legislation for topics such as; intellectual
property, rights protection and taxes. There also aren’t any regulations which
support the privacy, consumer rights and validation of digital contracts yet.
The communist party of China is the founding and ruling political party in China.
Even though it is a stable political environment, the lack of political freedom is
doubted.
Economical China is the 2nd largest economy in the world by GDP. However, it is the world’s
largest economy based on purchasing power. Which means consumers spend have
more money to spend on products. Also the labor costs in China are very low which
makes it an interesting country for big companies to manufacture their product in.
having big corporations manufacture and operate from within china will benefit the
Chinese government, because they will have to pay business and personal income
tax.
Social With a population of 1.4 billion people China is the most populated country in the
world. This means there is a huge market for consumer products in China. Also
with the increase in wages people in China have more money to spend. Just like in
another country also Chinese citizens like purchasing status symbols such as;
luxurious cars, latest technology or expensive clothes. There are over 770 million
internet users in China, which makes it an interesting market for foreign online
shops. Tao boa is the largest local e-commerce website in China and many people
spend a lot of money purchasing their goods form it.
Technological With over 770 million china has the largest online population. China has some huge
tech giants like; Alibaba and Tencent these giants make it hard for big companies to
establish themselves in china. China has set a goal for themselves which is to
become the global leader in science and technology. They want to move from
depending on labor to being an innovative economy. However the internet in China
is very different when compared to other countries. The Chinese people do not
have access to specific sites such as Google and the services of Microsoft.
Aspects of the Chinese Culture
Religion
Currently there are only five official religions in China. These are; Buddhism, Taoism, Islam,
Catholic and Protestantism. Any religion other than these is considered illegal in China. Almost
one quarter of the population in China has Taoism and Confucianism and other traditional
, religions as their religion. There are also a small number of people that have Buddhism, Islam or
Catholic as their religion.
Language
There are seven major dialects of the Chinese language with each one having their own
dialects. Almost 70% of the population speaks mandarin which is the usual language. The
second largest spoken dialect is Wu with 8.5% of the population. Other dialects are; Yue, Xiang,
Min, Hakka and Gan.
Food
Just like all the other aspects of the Chinese culture also the food is influenced geography and
ethnic diversity. The main Chinese cooking styles are; Cantonese (mainly stir fried dishes) and
Szechuan (relies heavily on peanuts, paste and ginger). Rise is also a major food source which is
part of the culture and the diet of most of the Chinese people. Chinese people don’t consume a
lot of meat that is why tofu is the main source of protein.
Guanxi
One of the cultural aspects of the Chinese culture is: Guanxi. Guanxi is a Chinese word for
network or connecting. This opens doors for new businesses and facilitate deals. A person who
has a lot of Guanxi will be in a better position to generate business than someone who lacks
Guanxi.
Respect
Another cultural aspect of the Chinese culture is showing respect to age, seniority or
educational background. For example subordinates cannot question the decision of superiors,
because this would be seen as being disrespectful in the Chinese culture.
Cultural aspects which influence the operations of G-Star in China
Products and services sold by G-Star should be acceptable in the Chinese target market
segment. When doing business in China, it is important the Chinese values are understanded.
The approach of marketing is determined by the culture of the people the company is selling to.
The Chinese Guanxi culture affects how marketers of companies are welcomed in the country.
For example, if local Chinese personnel marketed a new jean for G-Star Raw Chinese people
would feel more comfortable compared to when a foreigner would market the same product,
because the Chinese would just see him as a foreigner who doesn’t know anything about the
culture.
In China over 7 languages are spoken. The language which is spoken and used in a country has
impact on the; marketing, brand name, advertising and collection of information through
surveys and interviews. For G-Star to succeed in China it is important that they market their
product in the correct language which is spoken in that area. For example if G-Star wants a
store in Beijing the employees need to speak mandarin also the local advertisements and
