Xinhua Bookstore Chain Operations

Chain operation is one of the modern business operation and organization models adopted in many countries in the world, chain store is one of the business entities of this type of business model. In chain store business, a number of enterprises which conduct business on the same types of goods and services adopt a standard operation, common business strategies, and consistent sales behavior, centralized procurement and distributed sales, under the leadership of an operational center (headquarter), to achieve maximum profits through scaled business operation. Chain operation revolutionized retail business by solving the conflicts between bulk sales and dispersed demand of consumers; it represents the trends of business growth in modern retail business.Conducting business in chain operation by XinHua Bookstore System is a natural extension of reform in the past more than 20 years in China's book publishing and distribution industries, it is driven by the multiple forces such as China's entry into WTO, education and textbook reform etc. Transforming XinHua Bookstore System from traditional operation to chain operation is also a strategic choice to maintain domination by the state owned book publishing and distribution industries, and to maintain the control in ideology fields by the government.This study for the first time classifies nation-wide XinHua Bookstores, which have been transformed to or are ready to transform to chain operations, into 7 models based on their categories, the ownership relationships among provincial bookstore groups and their operational types. This classification reflects the current operational status and features of XinHua Bookstores in chain operation . The study indicates that chain operation practice among nation-wide XinHua bookstores generally is in a preliminary stage of development; the transformation is far from completion in internal management structure change, in operational design and implementation. In addition, market management in XinHua Bookstores System need to be improved rapidly.Based on the analysis of current status and problems existing in XinHua Bookstores'chain operations, the study proposes the following two recommendations to facilitate the transformation of business operations:1. The government should take necessary measures and adopt new policy to provide a sound environment to XiuHua Bookstore System for their transformation to chain operation.2. The XinHua Bookstore System should actively reform its operations and internal management; adopt new business approach to form core competitive capacity in chain operation.