UNIVERSITI TEKNOLOGI MARA

FUNDAMENTALS OF ENTREPRENEURSHIP
(ENT300)

Lecturer
SIR AHMAD KAMAL BIN YUSOP

CASE STUDY
WATSON E-CURVE
MUTIARA DAMANSARA
Prepared by:
AN NUR ATIRAH BINTI ABD HAMID (2017266276)
AQILAH BINTI MOHD TAUFIK (2017438012)
NUR LIYANA HIDAYAH BINTI ABD HAKIM (2017294092)
SITI HAZIMAH YASMIN BAHAUDDIN (2017393656)

Submission Date:
28 November 2019
AS1205_13
(Diploma in Science)
Faculty of Applied Sciences
Universiti Teknologi MARA
Perak
 Contents Pages

1. Introduction 1-3

2. Company Information 4-11

3. Company Analysis 12-13

4. Business Problem 14-15

5. Recommendation and 16
Improvement

6. Executive Summary 17

7. References 18

Table of Content
1. INTRODUCTION

1.1 Background of study

Entrepreneurship is to provide the students with the knowledge, skills and motivation
so that it could encourage entrepreneurial success in a variety of settings in the future.
Entrepreneurship are offered at graduate university programs so that it can focuses on
the development of skills and attributes that could enable the realization of
opportunity, where the management education is focused on the best way to operate
the existing hierarchies. Both of the approaches share an interest in achieving profit in
some form which in the non-profit organizations or government can take the form of
increased services or decreased cost or increased responsiveness to the customers or
citizens or clients. Entrepreneurship is the expansion and the development of an on
going concern and also involves that in the process that will leads to the setting up of
a business entity. The study of entrepreneurship is concerned with the entrepreneurial
behavior, the dynamics of business set and expansion and development.

UiTM students that wants to further study at bachelor level need to take the Principles
of Entrepreneurship course or ENT300 to give a proper guideline and expose the
students to the business orientation. In the course the students will be conducting a
case study to any one of a business or company. In this case study, it is required to
interview any of company or business to get to know the problems they are facing and
analyze it and try to find the solutions for the problem.

The purpose of this case study is for the students to be more intelligent in conducting
business. It is also for the students to be exposed to how a company operates its
business. This case study could also teach the students on how to solve the problems
in the future during their career. The purpose of this case study is also conducted to
investigates on how and what are the keys to be a successful entrepreneur and how to
have a successful business. This case study was conducted to Watson Corporation,
which a business where it provides service oriented. It is also conducted to see how
the entrepreneur of Watson face and solve the problems they are facing.
However, there are many challenges and problems on the road to be an entrepreneur.
Some of the examples of the problems might be abandoning your career when it
comes to dedicating yourself to the business. Especially when the business is new, so
nurturing and taking care of a business to success needs concentration and time. It is
hard and impossible to manage a business and have a career elsewhere
simultaneously. This is a risk if u want a business to be successful and have a steady
long-term career. Next problem that might occur is finance. Funding a new business
or any business is never easy. But as for to newcomers they are a bit of advantages
such as they might have a pool of capital from a business they previously had sold or
they could loan from the bank to fund its business. Another problem that might arise
is teambuilding. To have a right and good team is not easy. It is not to find the perfect
workers that could work well in a team and fill a certain role.
1.2 Company’s background

Name: A.S. Watson & Co Ltd

Address:

Watson Personal Care Stores Sdn Bhd,

19th Floor, Wisma Chuang,

34, Jalan Sultan Ismail,

50250 Kuala Lumpur,

Malaysia

Telephone Number: +60 14-742 2779

Email: mywatsons@watsons.com.my

Form of business: Partnership

Date of commencement: 1994

Watson is one of best known trading names in Malaysia. Originally the company
began as a small dispensary in Guangzhou, China in 1828, opened in Hong Kong in
1841, and it proceeded to become one of the first companies in the world that
produces the carbonated soft drinks. In 1994, Watsons expanded to Malaysia. Watson
has continue to expanded into many branches in Malaysia. There are about 90 stores
outlets in Malaysia and Singapore which will be expected to be increases steadily per
year. Watson’s regularly carry more than 25,000 items that is sourced from over 20
centuries, also including its own label that is GIANETTO. Some of the items that
contributed the most profits to the Watson’s are Personal Care, Lifestyle, Beauty
Products and Health and Fitness. The store ranges in size from the 2,000 to 12,000
square feet with the ideal size being a 5,000 square ft.
2. COMPANY INFORMATION

2.1 Background

A.S. Watson & Co Ltd is a subsidiary of Hutchison Wbarnpoa Limited

and is one of the best known trading names in Asia. The company began as a

small dispensary in Guangzhou, China in 1828, opened in Hong Kong in 1841,

and became one of the first companies in the world to produce carbonated soft

drinks. By the turn of the century, A.S. Watson had become a major trading force

in Hong Kong, China, Macau, Taiwan, Singapore, Malaysia and Thailand with

more than 300 retailing and dispensing branches.

In Taiwan, the group has a major chain of 145 drugstores. The 90 stores

in Singapore and Malaysia are expected to increase steadily by about 15 per year,

while the number of stores in Thailand will grow to 25 in the near future. In

China, A.S. Watson operated in excess of 90 outlets, the largest chain of foreign
owned stores in the mainland. This is expected to grow at the rate of 40 to 50

stores a year and to provide profitable returns within the decade.

Watson's is the original personal care retailer with more than 150 years of

retail experience in the region, with over 300 stores throughout Asia. Watson's

regularly carry more than 25,000 items sourced from over 20 countries, including

its own label that is GIANETTO. These imported items contributed most to the

6 total profits of Watson's.

GlANETTO can be divided m SIX major product groups:

* Personal Care * Lifestyle

* Beautiful You *Sweet Expressions

* Health and Fitness * Fun and Games

The store count has doubled in the last 4 years and is poised to exceed 500

stores by the year 2000. Today over 10 million shoppers visit Watson's each

month in Malaysia, Singapore, Taiwan, Macao, China, Hong Kong and Thailand.

The store range in size from 2,000 to 12,000 sq. ft. with the ideal size being 5,000

square ft.
2.2 Watson E-Curve Organizational Structure

Store Manager

Supervisor/
Assistant
Supervisor

Senior Customer
Assistant

Customer
Customer Assistant
Assistant
2.3 Business Model

The group operates five core businesses

a) Property Development and Investment

Hutchison Whampoa Property develops residential and commercial properties for sale
and lease. Its portfolio includes some of Hong Kong's largest private housing projects
and several landmark developments in the Mainland.

b) Ports and related services

The group's expertise in port investment and management stems from its pioneering
operations in Hong Kong. Its port operations arm, Hutchison International Port
Holdings', is now exporting its professional experience and expertise to ports in
different parts of the world.

c) Retailing and Manufacturing

A.S. Watson operates four of Asia's most innovative retail chains: Park 'N Shop
supermarkets, Watson's Personal Care Stores Sdn Bhd; Fortress, selling domestic
electrical appliances and computers and Bhs lifestyle fashion and home stores. The
manufacturing division produces and distributes a wide range of food and beverages
throughout Hong Kong, the Mainland and other Asian countries.

d) Telecommunications and Media

Hutchison Telecom operates a wide range of integrated telecommunications services

worldwide and is one the world's major providers of mobile communications.

e) Infrastructure and Energy

The Group has major shareholdings in Cheung Kong Infrastructure - which holds
interests in infrastructure and related businesses, and power plant projects:

Hong Kong Electric - the sole supplier of electricity to Hong Kong Island, and Husky
Oil - one of Canada's largest, privately owned oil and gas companies.
Watson’s Distribution Strategy
2.4 Watson’s Products and Services

They attain and subsequently maintain leadership position in the health, beauty and

fashion stores sector through:

a) building a reputation for excellence in meeting customer needs

b) generating continuous profit growth

c) believe in, create and maintain virtuous circles

WATSON’S VISION

To be the world’s leading health, beauty and lifestyle retailer.

WATSON’S MISSION

To exceed customer’s expectations in every market we operate.

2.5 Watson’ s Business, Marketing and Operational Strategy

 Business Strategy

i) Watson and the Community:

The company serves the community in the past years, and continues to engage in
dialogue with communities.

ii) Healthy competition

Watson has implemented diverse strategies derived from the SWOT analysis in order
for them to determine their SWOT and to sustain their business and compete with
other competitors.

 Marketing Strategy

i) Watson at the Market place:

The company operates in a way that safeguard against unfair business practices, also
sets out clearly the same ethical expectations with business partners.

ii) Watson’s Pricing Strategy

The company provides high quality products at reasonable prices that are affordable
by the general public.

 Operational Strategy

i) Watson and the Environment:

The company offers environmentally-sustainable practices happen at all levels at

Watsons.

ii) Watson’s Operations Hours

In the E-curve’s store, it operates from 10am-10pm daily.

2.6 MARKETING ACHIEVEMENTS

Based on the company’s website (aswatson.com.my/our-company-achievements), the

Marketing Department has stated that over the past 5 years, Watson has received a lot
of awards. For example, recently on 2018, Top 50 Innovative Retailer in Southeast
Asia. In 2019, the company got Gold Award - Innovation in Community Relations/
Public Service Communications. The company enables business to plan for its limited
resources in order to achieve stated marketing objectives. The key idea is to deliver
customer satisfaction yet provide business with a competitive advantage. Watson’s
marketing achievements have been proven by their promotional strategy mostly.
(Marketing Department of AS Watson Group)

Firstly, it is achieved by the sales promotion. Like purchase-with-purchase, point-of-

purchase promotion using the Watson’s member card and rebates. These kind of
promotional activities or incentives carried out and offered by the company within a
set time frame have influenced the purchases from the potential customers.

Next, the publicity. A lot of efforts are taken to develop and maintain good
relationship with the public to ensure good favorable public image of the business.
Like frequently appeared on social media, electronic media, as well as on printed
media.

Last but not least, personal selling on the selling floor. Personal sales presentation
conducted by a trained sales person to influence potential customers. It is most often
used for products that require demonstration or explanation like cosmetics and skin
care products.
3. COMPANY ANALYSIS

Watsons’ SWOT Analyse

Opportunities

The major opportunity of Watson’s Personal Care Stores Sdn. Bhd. is it is

a health and beauty care industry. Nowadays, people are being more concern on their

appearance and look which leads them want to buy more beauty care products.
Another opportunity is there are many new upcoming products that

belong to the health and beauty care market. Those new upcoming products will help

to attract the consumers to purchase at Watson’s Personal Care Store Sdn.Bhd.

Watson’s Personal Care Stores Sdn. Bhd. has demand to own more outlets is also

an opportunity as by this can improve the serving rate of Watson and gain more profit.
It is an opportunity for Watson’s Personal Care Stores to introduce relevant

mobile app in the platform such as ‘App Stores’ on Smartphone. By this way,
consumers can find out the location of Watson’s Personal Care Stores easily and stay

in touch with the promotions and products available at Watson. Besides that,
consumers can also get health and beauty tips play relevant games and download e-
coupons from the apps.
4. BUSINESS PROBLEM

The major problem in Watsons E-Curve Mutiara Damansara is problem in the human
resources department. There are roughly total of 550 people that are working for
Watsons throughout West Malaysia. Some of the major problem in human resources
of Watsons is lack of training of staffs due to rushed recruitment. Rushed recruitment
is due to shorthanded of staff and is done by the store management without the
knowledge of Human Resources Department. Most of the newly recruit do not get the
proper training but starts to work immediately. It is compulsory for a newly recruit
staff to go for the induction training and on-the-job training for about 3 days before
reporting to work before working the at the specific store that they have been
appointed. When the staffs are lack of training, they are more tending to do more
mistakes when working. Some mistakes that were done are difficulties to
communicate properly with customers whether it is about language or lack of
knowledge of product that was selling.

Besides that, there are some other problems under the human resources department
such as the salary is not sufficient compared to the workload that is given as Watsons
is a store that is known for its monthly promotion. When the workers are not satisfied
with the salary, they tend to change workplace that gives better opportunity and better
salary as they felt that there will be no career development. The last problems facing
by the Human Resources’ department is lack discipline among the staff. Discipline is
important during work because if all the staff are disciplined, it will increase the
productivity of the company.

Alternative solutions

1) Improves and emphasizes the work training among the newly recruited staff in
Watsons to avoid complaint from customers.

ADVANTAGES
i) Staff will get proper training and know how to treat customer
with proper care and attitude.
ii) Staff will be able to communicate properly with customers and
provide the right information.
 DISADVANTAGES

i) Amount of time needed to give proper training is restricted due

to short-staffed.
ii) Need a lot of budgets to train all the staff

2) Improve the salary for the workers to get paid as much as the amount of work

ADVANTAGES

i) Staff will not stop working abruptly without notice.

ii) There will be enough staff working when the promotions
month has come.

DISADVANTAGES

i) Require a capable staff that is willing to sacrifice time for the

amount of work at Watsons
ii) Workers will demand more pay on their works

3) Improved the employee’s discipline by forming disciplinary committee where

employees can report issues pertaining to discipline
ADVANTAGES
i) Staff will be more discipline and obey the rules
ii) Increase the productivity of the company as all the staff follow the
rules

DISADVANTAGES

i) It will not be followed consistently by all the employees and could

appear to be discriminatory
ii) Rules from disciplinary committee sometimes can be inflexible
5. RECOMMENDATIONS AND IMPROVEMENT

The alternative solutions that should be chose is to improves and emphasizes the work
training among the newly recruited staff in Watsons. This is to avoid complaints from
the customers as customers are the first and foremost important part of a business.
Watson’s are one of the biggest healthcare shops that are visited by all Malaysians.
The promotions that are done usually attracted a large crowd of customers. Thus, the
attitude of the salesperson or the staff towards the customer is important especially
during the promotion seasons.

Firstly, newly recruited staff must get proper training beforehand to have a well
developed staff with great attitude. The training is essential so that staff knows how to
handle a crowd of customers under pressure. Customers tend to get impatient
especially when there are promotions thus how a staff handles the customers is
important. The surrounding of the Watsons is also needed to be happy and
comfortable. This must be started by having a healthy and happy worker. Good
workplace will give out positive vibes which will attract more customers. This is all
can be started by having a good base of workers which can be developed by having
the workers to undergo some training.

This training is also essential to teach the workers proper customer services. When the
customers are satisfied this will indefinitely increases the sales of Watson’s. A great
service will lead to a great business. This is why staff training is important. When you
provide great services there will be lesser complaints, and will be greater sales. When
customers are satisfied with one’s service, they will tend to come again.

However, it is impossible to satisfy all the customers during promotion. There will be
one or two complaints from the customers. But this is where the training will be
needed, the training will also teach the workers on how to handle complaints and how
to avoid the complaint from getting sent to the headquarters.

Training is important for the staffs even though time is needed. These are some
recommendations and improvements that can be done.
EXECUTIVE SUMMARY

Watson Personal Care stores (Malaysia) Sdn. Bhd is an integrated global specialty
pharmaceuticals company. There are few problems that has being face in Watson’s
company since their evolutionary. The specific Watson that has been chose is Watson
E-Curve Mutiara Damansara. The most major problem that has been detected is in
human resources department. Major problem in human resources of Watsons is they
lack of training of their staffs due to rushed recruitment. The staffs are more tending
to do more mistakes when working when they lack of proper training. Other than that,
the problem is the salary is not sufficient compared to the workload even though
Watson is known for its monthly promotion. The best solutions for the problems are
improves and emphasizes the work training among the newly recruited staff in
Watsons and improve the salary for the workers to get paid as much as the amount of
the work that has been done.
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