Online Retail Strategy for a New Start-Up Business

Dynasty Wine Company in China is a new company competing in business of wine sales. Owing to the many players in this sector, this relatively young company is in a difficult situation of trying to increase it’s the consumer base in order to remain active in the market. Considering that the local markets are already awash with other wine products, the company has to explore options further afield to net its customers. In so doing, the company has to embrace technological advancements in the form of online business to do so. Quite a number of schemes that target at meeting a certain goal in the business arena have been developed. The move has made it obligatory for a business to integrate it in their plans to make certain they benefit totally from the benefits derived from it. In the (wine) industry, the employment of online dealing has become uniformly important. Many companies have diversified their business operation into many countries through the internet.


Online business is the use of the internet to produce and implement business transactions. It can be referred to as e-business in general terms. The internet makes available many opportunities that allow businesses to generate markets and supply to their customers in astonishing ways. It is an innovative area in international trade that entails trading of goods and services internationally through electronic means. It is the exploitation of telecommunication networks to manufacture, publicize or put up for sale goods and services.  With the development in know-how, electronic business has been rising radically calling for the consideration of the government and technology industry to make sure that it does not go out of hand.

The wine business in particular has completely undergone a substantive change over the recent years. This is coming off a stiff competition from increased participants who have plied the wine market. The increased competition can also be accredited to the end users who have the ultimate stakes in as far as the product’s marketability is concerned as well as the advancements in the technological sector such as increased internet usage in propelling business activities. Customers have turned out to be demanding due to the rise in the number of merchandise alternatives in the market. This briefing aims at establishing in a more critical sense, the affiliated business problems that Dynasty Wine Company in China has to go through in its bid to expand its products to the global stage. Starting up a new business is taking a risk; nonetheless if the resolution is well thought there are abundant benefits that come up with endowing in business. These business problems can be explained under the following sub topics; the implications, benefits, risks, challenges, requirements, recommendations and anything else that the company can implement in its bid to remain relevant to the requisite systems required to propel a new internet-based business dispensation. (Anon).

Though generally referred to as problems in the business arena the issues discussed herein only serve to provide better solutions that can give the stated company a competitive edge in the wine marketing business. Taking into consideration the fact that Dynasty Wine Company is relatively new in the business, options such as online retailing are being sourced in attempts to keep it at par with other established organizations such as accumulating a larger pool of the consumer base. The recommendations to achieve these targets would be to explore with undivided attention, the SPELT and SWOT analysis of the company as well as the proper use of technology-minded resources in light of the provisions of the contemporary world. However, care must be taken in the implementation process, as there remains a lot of job which need to be completed if these strategies are to bear any fruits within the time frames targeted by the company. The key positions envisaged by this briefing is in the sense that adopting online marketing and retailing systems requires a lot of input from the affected company especially now that the business arena has gone technological thereby resulting to globalization.

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Before Dynasty is set to start the new venture (internet retailing of their wine products), there are long and short terms constraints that it should consider ensuring continuity and success in the business. In the face of the ever changing proportions, the future of any business related activity is cast as unpredictable and impulsive in its composition. Therefore, the company ought to embrace a detail-oriented culture to source for any details (however negligible they would be) to help in establishing an efficient, strategic plan. The implications of Dynasty Company’s decision to adjoin the internal retailing system definitely offer varied sets of outcomes. These implications could be either of a positive nature or a negative nature. These are broadly discussed in the SPELT and SWOT analysis which outline the various strengths, weaknesses, opportunities and threats that the business is facing as well as the influences accruing from the environment within which the business is situated.

SPELT analysis

This is a management tool that helps in building informed decisions about the different influences expected from its interactive environment. This environment could be internal or external in its operation. In this case, however, the situation is such that more emphasis is placed on the external environment. SPELT analysis abbreviates the sociocultural, political, economical, legal and technological factors that may affect the environment in which a business operates. Considering the wine industry in China is highly competitive, these factors without a doubt control much of its operations.

Sociocultural environment

This environment characteristically analyzes the lifestyle drifts and consumer predilection, demographic changes and the major actions and manipulations that bedevil a company’s competitive ability. Lifestyle trends and consumer preferences affect the business’s performance. To guarantee customer satisfaction it has to provide extraordinary services. This involves Dynasty’s ability to retain its customers while at the same time attracting new ones. The demographic composition changes with time and such that the business is left to reinvent its strategies regularly to remain relevant to the customer’s requirements. Major events, and influences such as restriction on the sale of alcoholic drinks, and the varied views held by certain people about wine are also prone to affect the business’s performance in the future, and management should take note of them as they occur.

Political environment

This majorly encompasses the government and its regulatory policies on the sale of alcoholic drinks, taxation policies and restrictions on ownership on the type of the business operation. Government restrictions on the sale of alcoholic substances especially to minors as well as taxation policies are likely to have a negative effect on the performance of the business today. These have to be considered in the drafting of the strategic plan of the company.

Economical environment

This is specifically the most influential of all factors. They include; cases of competition among the various establishments competing in this type of business (online retailing), economic variables of interest and exchange rates when measured against the pound (this would affect the purchasing rate especially among those persons whose currencies are extremely inferior to the pound) and the issue of emerging powerhouses in the economic sector. The possibility of competition becoming stiff is imminent and thus the business has to put in place effective strategies to make its products more attractive. This would definitely be against the backdrop of numerous companies engaging in online retailing at significantly low costs and rapid emergence of new economic powerhouses. Since Dynasty Company is making an entrance into this business, the variation in the domestic interest rates that consequently affect the price levels, would be a big problem on their side.

Legal environment

The legal environment acts to regulate the activities of the company in as far as online services are concerned. Making entrance at a time that online retailing has been overtaken by instances of felony, the company may want to strengthen its rights and protection issues as well as wadding off any plagiarism accounts from rival companies. Coupled to this  legal environment would be characterized by regulations on policies and setting of technical standards and may have to fight off pressure from International pressure groups that may affect the company’s pricing strategy.

Technological environment

Technological alterations have without a doubt revolutionized practically every sector of the contemporary world. Such include proxy expertise and system severance rate and the timing, efficiency and fees of upgrading and scientific developments. Dynasty is in a position to boost its efficiency through the implementation of successful systems. Nevertheless, this may result in an increase, in its operation costs. (Beynon-Davies).

The external forces discussed above could help establish the retailer market growth or decline and the implications for Dynasty, which has a swiftly developing the business model that acts in response to development in the financial system, technology and the business in general. An economic recession could see economic factors having a substantial bearing on future strategies through undulation effects on socio-cultural and political factors.

SWOT Analysis

This analysis seeks to identify the strengths, weaknesses, opportunities and threats that the company faces. Proper identification of these elements helps the company to draft realistic, strategic plans as well as defining their goals to obliterate the weaknesses and threats.


The company prides itself in having in place strategic management and valuable administration, strategic expansion policies (seen in the way they want to embrace online retailing), and high levels of technical innovativeness. The strong and close relationship that it has managed to create between its suppliers and distributors can also be seen as a strong footing.


At the same time, the company has been lagging behind in the following areas: it has prioritized its customer needs even ahead of its premeditated relationships. The company seemingly has a stable culture that serves to explain its rigidity while its generally low profit margins have acted as major weaknesses in its operations.


There exist many opportunities that the company can explore to promote its competitive agenda. They include Merging with international vendors, expanding their trade on a global scale, expanding of their market by producing supplements and complements of wine, increasing technical developments through hiring of technologically oriented employees and exploring the emerging markets.


Any business is bound to encounter threats and their successes are measured because of how they deal with these threats. For Dynasty, these threats include global rivalry, intense opposition, political upheavals, price antagonism and imitated products.

These two strategies of SPELT and SWOT analysis are important in the identification of the strong points of a company and the relative regions that may need recommendations on measures to be undertaken to improve them. The strategies that are formed in line with the outcomes of these two analyses should be able to project the company’s business idea as well as help it remain competitive on all the fronts that it is competing in. For Dynasty, its strategies are effective if the outcomes of these two analyses are anything to go by.

Benefits, risks and challenges of Dynasty’s online retailing idea

The benefits of this approach are numerous in as far as pooling of a large consumer base is concerned. Online retailing helps the company to reach out to many potential customers thereby selling its products to the world. This could net increased sales or could ignite user demands. The risks that come with this adventure are numerous as well and could include exposing some of the business’s vital information. These details can then be used by swindlers to duplicate Dynasty’s products or to obliterate the repute of that business. Another huge source of risk would be a felony. This is a situation that exists when fraudsters pretending to represent a company (Dynasty for instance), would transact fake businesses on their behalf. The rate of a felony has increased, and many people are taking advantage of the internet to con people by offering fake products with the intention of robbing people. (Hitt)
Many people have fallen into these traps where they end up losing significant sums of their money without any goods being delivered to them. Other have lost substantial sum of money trying to establish the fraudsters with no achievement. This has condensed the level of trust on online businesses and many customers are terrified of buying products over the Internet. It is the responsibility of every company selling products online to ensure that they earn the customer’s trust and that customers are protected from fraudsters by use of features that cannot be imitated. For instance, before a customer places an order, he needs to be reassured the order found on the website is approved and comes from the specified source. This can be done by use of electronic signatures and dependable third party justification. Other challenges facing the company are the financial restraints i.e. the costs of study and development and the problem of trying to cope with the high intensity of promotion used by competitors since Dynasty products are not well known internationally. The allure of diversifying the production line could also act as a challenge if not properly planned.


These are the suggestions put forward to try and help Dynasty Wine Company to compete effectively in its business domain. Firstly, it should be a necessary priority for the company to generate a high-awareness level during the start-up stage to attain competitiveness among the well recognized brands within the marketplace. Since Dynasty is making an entrance into this area of marketing, it has to first advertise itself and then the product. This is because the consumers could be well acquainted with the existing companies and considering the products are closely related it is the identity of the company that would count. Coupled with this image factor, the company has to involve itself in intensive research and creativity to make sure that its products have some inimitable facets that draw a large number of consumers. (Kerin) With a near similar production system existing in most wine companies, Dynasty will have to create a unique feature in their products to help it sell. Such features would be running promotions in a bid to outpace its competitors.

All these actions should be tailored towards meeting the needs of the youth who are by far the largest consumer group. Dynasty needs to develop a strong cod of relationship with its consumer; supplier and distributor groups.
This is because it is the consumers who hold the key to making the product a success through purchasing it. The distributors, on the other hand, market it through various methods such as sponsored links and creations of websites in the case of online retailing. The suppliers must also be treated well to avoid defections to rival companies. Furthermore, Dynasty should explore its opportunities such as fostering cooperation with other likeminded businesses in opening up to new markets and exploring new avenues for its product’s sale. With the new venture, it has an opportunity of amalgamation with global retailers and to expand its business operations into other countries. This process may not be without challenges as it may be faced by the threat or intense rivalry, price competition and government regulations. Its promotion department will have to explore the existing managerial structure as well as the culture (both current and in the past) and give a detailed verdict as well as possible conclusions on the same. As concerns, the culture issue, the company should try and shed off any stable cultures and instead embrace outcome-oriented, and to some extent the aggressive culture in a bid to maintain a lead in the field.

Key to Dynasty’s expansion and success would be embracing information technology. The advancements witnessed in the technological arena should be put into use. The whole idea of online retailing depends on an in-depth understanding of the technological aspects such as web designing and advertisement. It therefore, has to adopt high technology which is constantly changing over the years to succeed in the new venture. An effectual formula has to be employed to set up new and eye-catching ideas for the victory of the firm.

In striking for the correct openings, Dynasty will have to investigate its main market challenger, as this is the chief threat it has to come across. The tactics being used by the rival company should be perilously appraised and assessed for essential counter action. In addition, the general plan of the opponent in a bid to control the market is an indispensable toolkit which Dynasty can use to approximate the cutthroat edge of the market. Similarly, the produce being offered to the marketplace at a lower price should be inspected to settle on its category and nature. (Dr. Allen)

Questions such as why a company lowers the price of its commodity and its accessibility to inexpensive raw materials should be checked thoroughly.

Apart from the aforementioned recommendations, Dynasty Company could formulate efficient information technology systems that could even include administering relevant technological classes to its employees, improve the efficiency of its internal services and develop a competitive advantage to rival its competitors. (Conway).


In view of all the factors discussed herein, it is important to realize that the competitiveness of a venture is vested on the quality of its management decisions. This therefore, calls for proper formulation of management strategies. Well choreographed strategies can create a big difference in as far as the results are concerned. Considering Dynasty is a standard company with departments, the most affected of all could be the marketing department that is tasked with the implementation of the online retail system. Given the various changes that have been witnessed in the population trends, the question of the size of the target group is brought to the fore. These recommendations and strategies that arise therein completely shape the success of the company if properly implemented. This is because the company will emphasize the idea of embracing information technology by every department. Considering its rather young age, these recommendations could only give rise to results in the long term and so the situation right now is that it has to take risks in implementing them. The capital set aside for the implementation of this strategy is enough to push it to completion and therefore, Dynasty should be free to implement them.

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