Harper Adams University college And Beijing University of Agriculture

Food Quality and Retail Management

Module Tittle:Academic and Professional Development

Assignment Title: Response to consumers

HAUC ID: 09163800 BUA ID: 200821021041 Submitted To:Xu Yang Year 1 Date: 2009-11-26

Date of submission: 2009-11-27 Word count:1942 (Excluding reference)

Contents
Contents...............................................................................................................................................2 Summary:............................................................................................................................................1 1. Introduction:....................................................................................................................................2 2.1 The development of Chiness economic........................................................................................2 2.1.1The change of the income...........................................................................................................2 2.1.2. More and more world business group found out the valueble of Chiness market...................5 2.2. The policy.....................................................................................................................................5 2.2.1. only one child in a family.........................................................................................................5 2.3. The behavior of the retailer..........................................................................................................5 2.3.1. Advertisement............................................................................................................................5 2.3.2. The price and quality.................................................................................................................6 2.3.3. The Services..............................................................................................................................6 2.4. Topical issues ............................................................................................................................6 2.4.1. The house prices .......................................................................................................................7 3.Evaluation.........................................................................................................................................7 4. Specialist food store........................................................................................................................7 5. Conclusion.......................................................................................................................................8 References list:....................................................................................................................................8

Summary:
Consumer behavior is a very important topic. More and more research have been done on it. This report will analyse this topic too. With the development of Chinese economic, the income of Chinese people are increasing. Thus ,more and more world wide company have found out the valuable of Chinese market. After that , the buying behavior were changed. Consumer use their money on variety ways. The policy also influenced the behavior of consumer. In addition, how do the retailer behave also is a factor. If the retailer use the advertisment, increase the quality of their production and develop the level of their services. The preferences of the consumer may be changed. Topical issues is also a key factor.For example, the issue of house price. The report also evaluated the changes of consumer behavior and adduce really example of Wei Duo Mei Specialist food store which have some ways to attract the consumer. At last ,the report also give some suggestion.

1. Introduction:
In the background of world economic crisis and huge development of economic in China . The consumer behavior of China have changed a lot. They care more about their pocket.In addition, the consumer behaviour was define as Those activities directly involved in obtaining, consuming.and disposing of products and services, includling the decision processes that precede and follow these actions (Blackwell et al., 1995). All this process is called consumer behaviour. The report will identify what have influenced the buying behavior and what kind of buying behavior were influenced. The report also point out the changes of buying behavior in these period. At last ,the report will show out some suggestions.

2.1 The development of Chiness economic 2.1.1The change of the income

In last decade , Chiness economic has a big development. For example, China went into World Trade Organization in 2001. Thus, the income of Chinese people has changed a lot. Table 1:Capota annual income and Engels coefficient of urban and rural households

Table 2 : Basic Conditions of Urban Households

(Source:China Statistical Yearbook, 2008) According to the material, the income of both urban households and rural households had a steady increased in the year from 1978 to 2007. In addition, the consumption of the people also had a increased. Thus, Consumption for the current period of the most important factor is the income, but at the same time consumption is also influenced by such factors as national policy, income levels and growth rates direct ring for the growth of consumer demand, which in turn will affect the entire economic growth(Li, 2007).With the changes of income.The attitude of the consumer were changed. They use their money in variety ways and buy some expensive things. Accordding to the research of the income and consumption from 2005 to 2006. There are three group of consumer. First, high level of consumption which earn 85000 yuan per family. Enterpriser, the people who worded in high-technology area were included in this group. The second group is middle income which can get 35000 to 55000 yuan per year.This group is built by the major citizen or self-employed. This group has the biggest influence with the economic in China. low income and consumption people is the last group .This kind of family can get 7000 to 8000 yuan per year (An, 2007). For this 3 group, they have different characteristic of consumotion. The low group just want to hold on the family.So they just spend their money on daily use. Middle group
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have a higher income.What is more, they are not only use their money on basic daily life, they also use money to make their life better. This kind of people have heavy demand to the service of entertainment or education. At last, High consuption group have the best quality of life. They prefer to use their money to buy house or valuable vehicle. Moreover, different kind of people have different income. Their attitude and purpose of consumption are different. As conclusion, the buying behavior was influenced by the level of income.

2.1.2. More and more world business group found out the valueble of Chiness market.
As the background of the global economic downturn, however the China market still retains a strong growth momentum. So more and more international business group chose China as a big market. They took their prodution or their company into China. This lead to the increase of the consumption. Because, at first, consumer can buy some world famous production which they cannot get it simply before. Second, the
Foreign Owned Enterprise stimulated the Chinese market. For example, more corporation means higher demand in labour market. More people got job, so they can make contribution to the increase of the consumption.Thus, the buying behavior of the Chinese consumer was influenced by the world business group.

2.2. The policy 2.2.1. only one child in a family

From the 80s, China built the policy of only one child in a family. After that, most of Chinese family only have one child in their family. Thus, the purpose of consumption changed. The parents use most of their money on this child. Because they want the child got good education or live in a comfortable family. So, the consumer behavior of this family is always about the child. They spend their money on sending their child to a good school. Second, they buy their kid whatever they want.Finally, the normal consumer behavior was changed. They do not care want themselves need. However, they try their best to give the best thing which the kid needs.

2.3. The behavior of the retailer 2.3.1. Advertisement

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As well known, advertisement is a media between seller and consumer.It always influence the consumer behavior. In last decade, this kind of media had a big development. We can got this kind of information from TV , newspaper, internet. There are four steps in the process which is the influences of advertisement: connection, receptive, change of attitude and change of behavior(Ren, 2000). Moreover, some super star were invited to the advertisement. Because people like them and would like to fallow them. In this way, the consumer behavior was influnced. By these way, the consumer always search the information before they buy something.

2.3.2. The price and quality

This two keywords together in this report. Because, the theory of the cost performance which was bring forward by Sprem ann(1985): the degree of satisfaction to a product depends on the proportion between the quality and the price, the larger degree of satisfaction lead to a higher possibility of buying behavior. . The consumer always find out the information of the production when they want to buy something. Because, the consumer were becoming more care about whether the price and quality is reliable. And finally, choose the production which has highest cost performance.

2.3.3. The Services

With the time past, the degree of service became a key factor that influenced the buying behavior. A corporation which has a good after services is always be the first choice of the consumer. Here is a table that shows how do the patient evaluated the attitude of the nurse. Table 3: The evaluation of the patient to the attitude of the nurse Degree Data of service attitude number probability(%) 51 31.5 53 32.7 55 33.9 3 1.9 (Source: Keiko1995) According to this table.64.2% of patients thought that the service attitude was important. Nearly no man chose the option of unimportant. Thus, The service plays an important part of the consumer behavior. It influences the decision of the consumer. Very important important commonly unimportant

2.4. Topical issues

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2.4.1. The house prices

Different area in China have different house price.This factor is also a factor that affact the consumer behavior. Because, when the price of the house increased, it makes the wealth bigger. However, when the price is lower makes the wealth decreased. In Friedman (Friedman, 1957) persistent income hypothesis States, consumers that capital gains is persistent, the more likely to promote long-term consumption. So, the consumer always prefer to save their money and use their money to buy house which may be bring them wealthy. Nevertheless, the consumer use their money on buying house, they will not have money use on other consumption.

3.Evaluation
In this period, the buying behavior of Chinese consumers changed a lot. First, the attitude were changed. Because the people earn more money than before, thus consumers have more money to use. They may more care about their healthy or spend more money on entertainment. What is more, some rich man choose to collect some valuable things. This changes means peoples life are becoming better. Otherwise, this changes lead to more trade happens in the market which increases the consumption. Second, the purpose of buying behavior were changed. People spend their money only on some simple ways, like they spend their money on their children or they use their money to buy house. That may lead to the imbalance prices of some area in consumption. For example, the house price in Beijing is becoming higher and higher which more and more local citizen cannot afford it. Third, the way how consumer got the information were changed. People did not have some many ways to get the information. So the consumer simply choose same brand. But now, with the development of media. People have such many ways to get information about the production.Thus, the competation between the retailer turns sharply. In order to be the winner of the competation. The retailers change their strategy. And finally make the production perfect. Fourth, because of the world economic. Although China do not be affected seriously, there still have some influences of consumer behavior. The preferences of consumer were changed. People more care about saving money(Peng, 2003). In this condition, people do not spend so much money on consumption. It may decrease the Chinese economic. But on the other hand, it may also increase the bank saving.Those are some changes in buying behavior of Chinese consumer over this period.

4. Specialist food store.

There are lots of specialist food store in China. Wei Duo Mei is one of it. Beijing Wei

Duo Mei Foods Co, Ltd. was established in April 1996 which is a multiple shop and good for baking, coffee, European food( The net of Wei Duo Mei, 2009). Wei Duo Mei specialist food store always have a very good evironment to let the consumer to choose the food. The food is placed in some shop window, but it is very clean and easy to take. What is more, when the consumer move into the shop, the smell is very good which make the consumer can not stop to buy some food to taste. Otherwise, the retailer also offer some card which can cover for money to some company. When the people got this kind of card. They may use the card to buy some food in the shop. As consequence, The Wei Duo Mei specialist food store have very good ways to attract consumer to their shop. At first, good evironment lead to the consumer make their shop as the first choice of food store. Second, clean condition make the quality of their food reliable. Third, good taste can attract the consumer pay attention to their shop, though they do not want to buy something. At last , the strategy of giving card can makes their brand wellknown. Those are very good ways.

5. Conclusion
Up to now,the report had analysed that the consumer behavior was influenced by the development of China economic, the policy of China, the behavior of retailer and some topical issues. In order to increase the consumption. The retailer should identify that what kind of the consumer is ,which is about the degree of the income. After that, make different level of product for different people. Otherwise, they should make sure the quality and the price is reliable. Increase the level of the service. Follow the policy and keep step with the topical issues. Finally, the retailer must try their best to reponse the consumer.

References list:
An, N. 2007. On consumer income stratification and marketing strategies. Economic & Trade Update. No. 70, Volume 5, June 2007. 27. Beijing Wei Duo Mei Foods Co, Ltd. 2009. Corporation Introduction . [On-line] Available from: http://www.wdmcake.cn/index.aspx. [Accessed 20 November 2009]

China National Statistics Institute . 2008. China Statistical Yearbook. China: China Statistics Press.

Engel, J ; Blackwell, R; Miniard, P. 1995. Consumer behavior. Eighth edition.

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United States of America: The Dryden Press. Harcourt Brace College Publishers.

Friedman, M. 1957.Permanent Income Hypothesis. publishing details not given.

Keiko, O. 1995. The relationship between nurse and patient. [On-line] Available from: http://d.g.wanfangdata.com.cn/ExternalResource-syhlzz200730032%5E2.aspx [Accessed 11 November 2009] Li, B.R. 2007. GDP in Beijing and consumption behavior of econometric analysis.Journal of Beijing technology and business university(sioial science). Vol. 22. No5. Sep2007. 87. Peng Z; Liu,K.H. 2003. The research of Enterprise strategy in Marketing and consumer behavior in the background of wourld conomic crisis. Business economics and administration. No.10. Vol 144. Oct 2003. 21. Ren, T. 2000. Advertising and consumer research. Master thesis in Xi An transportation University. [On-line] Available from: http://d.g.wanfangdata.com.cn/Thesis_Y344844.asp. [Accessed 9 November 2009]