Integration Of Research To Front B2C Business In China

This paper mainly discusses electronic commerce in China especially B2C andlogistics or express delivery related to electronic commerce. This paper explores thecurrent development situation and causality of the two industries and the big B2C’sforward integration toward logistics. First, through digging into literature, I retrospect therelated theory and research about vertical integration and clarify the different definitionabout electronic commerce and logistics. Second, I attempt to conclude the motives andreasons of big B2C’s forward integration toward logistics after examine the theory ofvertical integration and the problems and status of logistics in B2C. Third, I establish asimple mathematical model under a series of hypothesis to get the boundary condition ofwhen B2C can take the action of forward integration.Through the above research, I get the following conclusion:Through examining the modes of logistics of some main B2C company, I sum upthree modes: outsourcing mode, vertical integration mode and cloud logistics mode.The motives of B2C’s forward integration in China are the following: get corecompetence, decrease transaction cost, eliminate uncertainty, prevent opportunisticbehavior, increase barriers to entry and get other sources of profit.Though B2C have the motives of forward integration, not all the B2C are fit for andcan afford forward integration. In the decision-making model, under some hypothesis, onlywhen B2C’s sales amount to a certain level, B2C can consider whether to forward integratethe express delivery.