ANALYSIS OF HR ISSUES OF VIPSHOP IN UK

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Table of Contents
Introduction......................................................................................................................................2
Background of Company.................................................................................................................2
Analysing HR Issues in the UK.......................................................................................................3
HR Shortage.................................................................................................................................3
Employee Loyalty Crisis.............................................................................................................4
Differences in Organisation Culture between UK and China.....................................................4
HR Transformation......................................................................................................................5
Conclusion.......................................................................................................................................5
References........................................................................................................................................6
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Introduction
With the development of the global economy, many companies have developed many
foreign businesses because of the convenience of foreign trade. But at the same time, these
companies are also facing some resistance to entering overseas markets. One of the obstacles is
the problem of human resources. This article is about one of China's (Dexter, 2020). For
organisations with a strong desire for growth and investment, international expansion is only a
matter of seeking development. Cross-border and cross-cultural activities pose new challenges
for companies and the way external organisations deal with such pain has a significant impact on
overall performance. They need to have the skills needed to tackle and overcome the inevitable
HR challenges (Trstenjak and Ćosić, 2018).
Despite decades of expansion and globalisation, the vast majority of respondents have
pointed to the HR challenges as a constraint on development, while acknowledging that
international expansion is an opportunity for HR to make a strategic contribution. This essay is
about one of China’s largest e-commerce companies. If Vipshop expands its business to the UK,
it will face human resource issues.

Background of Company
Vipshop is an e-commerce company founded in Guangzhou, China. It was listed on the
New York Stock Exchange in 2012. Now it has developed into one of the top 500 enterprises in
China. The popularity in China is very wide. (Gao, 2017). According to Center (2020), VIP.com
is in 115th place on the 2017 China 500 list and is also in the top 3 in B2C online stores. Co-
author of Deloitte and STORES Media, 2017 Global Top 250 Retailers rank VIP.com as the
fastest-growing retailer in the world. BrandZ ™ is ranked 40th on VIP.com in the top 100 most
popular Chinese brands of 2017 (Center, 2020). The popularity in the Chinese e-commerce
market is widespread. Mainly engaged in online discount sales of well-known brands, which is
equivalent to the online version of outlets. With affordable prices and high-quality express
delivery services, it is welcomed by online shopping enthusiasts. However, Vipshop has become
the third-largest shopping mall in China, according to the Beijing Internet Consulting Center’s
research center. In 2015, the company’s net income exceeded 40 billion yuan ($ 6.14 billion)
(Zhao, Wang He, 2018). The company has announced plans to upgrade its international business
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in Chongqing. The initiative is expected to add more and more well-known foreign products to
the financing platform and expand the customer base.
Analysing HR Issues in the UK
Vipshop has not yet expanded its business to the UK. If there are relevant plans in the
future, the human resources issues that companies will face are as followsdescribed below.

HR Shortage
First, Vipshop has huge requirements for the number of employees. There may be a crisis
of human resource shortage. The difference between Vipshop and other e-commerce platforms is
that if the product received by the customer has quality problems or the wrong size, Vipshop will
be able to have a courier to replace the product on the same day. This is also the key to
Vipshop'sVipshop’s customer satisfaction. The product can be returned and exchanged in time
because Vipshop has its own inventory warehouse in almost every major city in China. (Gao,
2017). And there is a customer service to communicate with customers in a timely
mannerpromptly. This requires a large number of full-time employees to ensure the operation of
the system.

Companies that have no influence must be more prone to a crisis of human resource
shortages. (Gao, 2017). The shortage of human resources is determined relative to the
competitiveness that enterprises need for survival and development in the face of fierce market
competition. The situation that Vipshop may face is that human resources cannot meet the needs
of its business strategy, and the strategic goals cannot be completed on schedule. In the end,
companies can only remain at a disadvantage in the fierce market competition and fall into
business difficulties. (Liqin, 2019).

Second,The deployment of employees abroad is still an option that requires special

technical knowledge and organisational knowledge of employers or is chosen as part of an
international leadership development program. In the entire international mobile phone
distribution team, from migration, short-term or long-term projects to regular business trips, cost
control is still the main driving force to ensure that international projects are both cost-effective
and business-friendly. To retain talent and make the most of their global mobile phone capital,
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employers must also consider creative ways to encourage returning recipients to stay in business
after the deadline.

Employee Loyalty Crisis

The second HR issue is that there may be an employee loyalty crisis. After the business develops
in the UK, Vipshop must also maintain the same service quality as China, or even better.
Regardless of the number of employees, the express delivery business in the UK is very different
from that in China. (Kim, 2017). British express companies usually have the problems of getting
off work very early, slow logistics and hardly working on weekends. Under the influence of
these factors, it is difficult for Vipshop to maintain its service quality. How to enable employees
in Western countries to keep up with the speed of business operations and maintain their
enthusiasm for work. is a key challenge for the organisation. This involves a lot of staff training
and salary issues.

In the context of local consumption in the UK, brand discounts are no longer so rare.
(Monday, 2017). Whether it is online Black Friday, Boxing Day, or offline T.K Max, it is the
same market competition relationship, so market risks also exist.

How to make a new e-commerce company catch people's eyes in the UK. Publicity and
marketing programs and even some brand-new event planning are indispensable. for making a
new e-commerce company catchy in people’s eyes in the UK. Western employees can bring
more creative ideas and make the corporate culture more diversified. Let Vipshop can strive to
better adapt to the British market environment. But thea large amount of work intensity in the
early stage will create another problem-overtime.

Differences in Organisation Culture between UK and China

In China, working overtime is a very common thing, and companies may even require
employees to work overtime. (Ye, Gindling, and Li, 2020). This common phenomenon is called
"996". Different national cultures have formed different working habits. British employees may
feel resistance and incomprehension towards "overtime" behaviorbehaviour. Employee loyalty
and employee satisfaction will be greatly reduced. When employee loyalty decreases, they will
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be dissatisfied with the company they work for and even choose to leave, causing employee
turnover. (Khuong and Linh, 2020). During this period, there may also be a reduction in
efficiency and the risk that the remaining employees will not be able to do the job, resulting in
employee turnover costs.

Therefore, when Vipshop wants to enter the UK market, it must understand in advance
the needs of Western employees for work benefits, understand the cultural environment and
work habits, and make adjustments. Competitiveness and high recognition of employee
affiliation are important achievements. At this time, motivation becomes the core goal.
Appropriate material and spiritual encouragement should be used to increase employee activity.
(Wang et al., 2019). Benefits and salary are both important factors that affect loyalty. "Money is
not the most important thing, but it is undoubtedly very important." The current laborlabour cost
in the UK is higher than the European average. Therefore, when Vipshop enters the UK market,
the expenditure on human resources costs will be a big challenge for an enterprise.

HR Transformation
The last and most important thingissue is that Vipshop is facing the transformation of
human resources. Simply put, it divides traditional HR positions into three, SSR (Shared Service
Center) + HRBP (Human Resources Business Partner) + COE (Expert Center) .). Practice in
China has proved that this mode of operation can significantly improve the efficiency and
effectiveness of HR. The result of the transformation is that the human resources department
operates likeas a business department and indirectly meets the needs of external customers by
meeting the needs of internal customers (employees of the business department) (Brockbank et
al., 2018).

Conclusion
When developing business in the UK, whether this new mode of operation can be
accepted by Western employees, and ifVipshop must aim to deal with the workloadpotential HR
challenges identified above. To stay updated with the changing world, Vipshop’s HR managers
need to have an international vision of the threehow to manage individuals at home and abroad
successfully. International human resource management departmentsenables companies to enter
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the market more efficiently, as well as to develop tools for their employees. The above are
typical areas to ensure the success of Vipshop HR's international business. The key to this
process is balanced, itto identify and maintain the high-quality foreign consulting resources
provided by selected international outreach service companies. The possibility is impossible to
determine.to find and participate in many law firms, for the benefit of consultants and payroll
companies and manage them in many time zones and geographical areas, which can certainly be
a difficult and time-consuming process.
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References

Dexter, J.C., 2020. Human resources challenges of military to civilian employment

transitions. Career Development International.

Monday, O., 2017. Human Resources Accounting: Issues, Benefits and

Challenges. International journal of economics, finance and management sciences, 5(3),
pp.129-138.

Center, E.T., 2020. Study on the Profit Model in the E-commerce. Modern Management based
on Big Data I: Proceedings of MMBD 2020, 329, p.181.

Zhao, Z.H., Wang, H. and He, Y.H., 2018. Looking at Vipshop from the Perspective of Supply
Chain. Value Engineering, p.06.]

Liqin, H., 2019. Recommendation, Customer Satisfaction, Online Shopping Experience, Trust,
and Word-of-mouth Affecting Consumer Online Shopping Decision in China.

Kim, M., 2017. The effects of leader–member exchange on generation Y employees’

organizational behaviours in China. International Journal of Tourism Sciences, 17(2),
pp.140-152.

Ye, L., Gindling, T. and Li, S., 2020. Compliance with Legal Minimum Wages and Overtime
Pay in China, Effects Across the Distribution of Wages. In Minimum Wages in
China (pp. 223-257). Palgrave Macmillan, Singapore.

Khuong, M. and Linh, U., 2020. Influence of work-related stress on employee motivation, job
satisfaction and employee loyalty in hospitality industry. Management Science
Letters, 10(14), pp.3279-3290.

Wang, M., Guo, T., Ni, Y., Shang, S. and Tang, Z., 2019. The effect of spiritual leadership on
employee effectiveness: An intrinsic motivation perspective. Frontiers in psychology, 9,
p.2627.
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Brockbank, W., Ulrich, D., Kryscynski, D.G. and Ulrich, M., 2018. The future of HR and
information capability. Strategic HR Review.

Gao, S., 2017, December. Study on the Marketing Strategy of Vipshop Sale. In 2017 2nd
International Seminar on Education Innovation and Economic Management (SEIEM
2017) (pp. 437-440). Atlantis Press.

Gao, S., 2017, December. Study on the Marketing Strategy of Vipshop Sale. In 2017 2nd
International Seminar on Education Innovation and Economic Management (SEIEM
2017) (pp. 437-440). Atlantis Press.

Trstenjak, M. and Ćosić, P., 2018, September. Challenges of human resources management with
implementation of Industry 4.0. In Proceedings of IOTSM2018 Scientific Conference.