SCHOOL OF ARCHITECTURE, BUILDING AND DESIGNFOUNDATION IN NATURAL BUILD ENVIRONMENT

ENGLISH 2 (ELG 30605)

LECTURER: CASSANDRA WIJESURIA

SUBMISSION & PRESENTATION DATE: 3RD DECEMBER 2014

PRESENTATION TITLE: CHINESE HERBAL SHOP

GROUP MEMBERS:

NamesID

ENG SHI YI 0317849

TAN JO LYNN

TAN YINCY 0318355

TAN WEI ZHEN 0318560

LAI TZE XIUAN 0318056

KHAIRUL JEFRI NEO 0318237

RUBEN HOO 0317850

CONTENT

1. RESEARCH PROPOSAL 1.1. INTRODUCTION

2. KEY SUMMARY 2.1. LOCATION 2.2. THE GROUP 2.3. THE TOPIC2.4. RESEARCH QUESTION2.5. METHODOLOGY

3. BRIEF DESCRIPTION OF THE BUSINESSES3.1. HERBAL INDUSTRY3.2. ZHONG HUA HERBAL SHOP3.3. BAO JIAN HERBAL SHOP

4. TRANSCRIPT4.1. ZHONG HUA HERBAL SHOP4.2. KH HERBAL SHOP

5. RECOMMENDATIONS5.1. ZHONG HUA HERBAL SHOP5.2. KH HERBAL SHOP

6. COMPARATIVE ANALYSIS6.1. COMPARATIVE ESSAY6.2. COMPARATIVE TABLE

7. APPENDICES7.1. MEETING MINUTES7.2. SHOP DETAILS

8. BIBLIOGRAPHY

9. REFERENCES

INTRODUCTION

In this report, we will study, compare and analyze 2 businesses of the same

industry but located in different regions of Malaysia.

The industry chosen for this research is herbal industry. We chose this industry

of all possible option because we as human found ourselves to be concern of our health in

order to have subsequent achievement in our life. We eventually limited our research to 2

herbal shop in Malaysia, the first one is Zhong Hua Shop which is located in Taman

Ros, Teluk Intan, while the other one is Bao Jian herbal shop which is located in OUG,

Kuala Lumpur. Going through the 2 businesses, we found that the shop that is running in

Teluk Intan is more stable compared to the shop in Kuala Lumpur, most probably

because of its workers’ attitude and technique in running the business.

KEY SUMMARY

2.1 Location

We carry out our research at 2 different states. The first research was carried out in Teluk

Intan. This state consist of many industry such as food, palm oil industry etc. But the

food industry is probably by far the most famous industry here. The herbal industry stood

strong in Teluk Intan throughout centuries as it focuses on customers’ needs.

The 2nd research was carry out in Klang valley. OUG, Kuala Lumpur. It is the home for

most of us and is highly populated by the Chinese.

2.2 The Group

Our group consists of seven members

- Eng Shi Yi

- Tan Jo Lynn

- Tan Yincy

- Tan Wei Zhen

- Lai Tze Xiuan

- Khairul Jefri

- Ruben Hoo

2.3 The Topic

The 2 businesses that we decided to compare on are the Zhong Hua herbal shop in Teluk

Intan and Bao Jian herbal shop in Kuala Lumpur. This 2 shop have been in the herbal

industry for more than 20 years. But they are both very different in terms of the

employees’ attitude, services, advertisement method, etc.

2.4 Research Questions

1. What is your name?

2. Who is the founder of this business?

3. When did you start up your business?

4. What inspire you to start up the business / what is the history of it?

5. What are the main products being sold here?

6. How many branches do you have?

7. How many workers do you have?

8. What is estimated number of customers that visit your shop daily?

9. What are the obstacles when you first started up your business?

10. How did you overcome those obstacles?

11. What are the strengths of your business?

12. What are the weaknesses of your business (if any)?

13. What/ who are your biggest trait or competition?

14. What strategies do you use to compete with your competitors?  

15. Who is your main targeted market?

16. Where do you see your business in ten years?

17. Do you wish to extend your business maybe to the international market?

18. What are your hopes for this business?

2.5 Methodology

2.5.1 The Interview

The interview was carried out during our trip to Teluk Intan. We visited the Zhong Hua

Herbal shop in Taman Ros, Teluk Intan and met the owner, Mr. Phoon Kam Yao. We

started off by asking him general questions about the shop while filming the interview.

He then gave us a tour and introduced to us a variety of herbs and briefly explained about

his shop. He also gave us his name card.

The second interview was carried out on the next day. We went to Bao Jian herbal shop

in OUG, Kuala Lumpur. The employee was quite rude and does not seem to welcome us.

Thus, we were not allowed to capture any photos and interview the founder of the shop.

2.5.2 References

Besides on site interview, we also look up on the Internet for references. Both the herbal

shops do not have a proper website. Hence, we have to get some of the information from

the residence around the area.

2.5.3 Meetings

We have conducted a few meeting before going for the interviews. This is to ensure that

all task were distributed fairly to all group members. We also kept in touch through

Whatapps, Facebook and face-to-face meeting to make sure that everyone were on track.

BRIEF DESCRIPTION OF THE INDUSTRY

3.1 Description of the herbal industry

In the herbal industry of Malaysia, herbs are usually traded through entre port but

Malaysia also involves in the supply of herbal raw materials or herbal product businesses.

For the herbal entre port trade, the herbal raw materials or herbal products that are

imported from other countries are repack into new products for sale in local or in third

world countries.

There are many local suppliers of herbal raw materials or herbal products which export

their merchandises on order. Malaysia has an estimation of about 1300 plant species that

can be used in medicine, 200 plant species for herbal remedies and about 50 plant species

mostly used in traditional medicine preparations.

Malaysia usually supplies its’ herbal products to countries such as, the United States,

Europe, Japan, China and the Middle East countries. There are low-cost suppliers such as

China and India which pose serious profitability problem to the Malaysian herbal traders

when trading internationally due to the competitive pricing. Most Europe countries

constitute a larger segment of the herbal industry market while Japan and the United

States are trailing behind the Europe countries. Eastern Europe countries and China may

influence the supply demand of the herbal materials in the industry’s market due to their

pursuit for hard currency.

3.1 Zhong Hua Herbal and Medicine

Zhong Hua Herbal and Medicine was founded by Mr. Phoon Kam Yao in the year

1986. The business is about twenty-eight years until today and it is located in Teluk

Intan, Perak. The main income of the business is by selling herbs and giving health

consultancies. The current owner of the business is still Mr. Phoon Kam Yao. He

graduated as a medical practitioner and was interested in herbs and medicines which

marked the beginning of his journey to start up an herbal shop. According to Mr. Phoon,

there are two other herbal shops nearby which are the biggest competitors to his business.

Mr. Phoon was inspired by the interest towards herbs and medicine. He began

with a plan of locating his store in a row of shop lots in front of a housing area; this is to

provide a convenient environment to the residences and eventually increases the rate of

customers. The business currently only has one branch and Mr. Phoon does not plan to

open new branches and extend the business to other countries anytime soon. He is now

still searching for a suitable person to inherit his business.

3.2 Bao Jian Herbal Shop

Bao Jian Herbal Shop was founded by Mr. Liu Shi Rong in the year 1984. It is

located in Overseas Union Garden (OUG), Kuala Lumpur. The business started thirty

years ago and is still operating now, giving services to customers. The business earned its

highest income by selling the herbs and groceries. As Mr. Liu is a businessman, he

started this business only for the purpose of earning money. There are a few herbal shops

in that area and recently a new herbal shop which might be the potential competitors for

Bao Jian herbal shop.

Mr. Liu began the business alone and today the business had evolved where he

had to employ a few more employees to look after the shop. The shop is located in a row

of shop lots opposite a food court. Due to the activity of the crowd near the food court, he

got free advertisement for his store. The business also has a few branches around

peninsular Malaysia but Mr. Liu does not plan to extend his business to other countries.

TRANSCRIPT

4.1 Zhong Hua Herbal and Medicine S hop

1. What’s your name?Phoon Kam Yau

2. Who is the founder of this business? I am the founder of this shop.

3. When did you start up the business?I started off this business around 22 years ago. Either 1986 or 1987, I can’t really remember.

4. What inspired you to start up this business? I am interested in Chinese traditional medical since young. Thus, I started this business after graduation. And of course, I didn’t have enough money that time, so my parents helped me financially.

5. What are the main products or services being sold/ provided here?We sold Chinese medicines, Chinese herbs and also provide health consultancies.

6. How many branches do you have?I don’t have any other branches.

7. How many workers do you have?2 workers

8. What is the estimated number of customers that visit your shop daily?I am not very sure, but I think around 100.

9. What are the obstacles when you first started your business?When I first started my business, I do not have enough confident, low self-esteem. The main obstacle is I do not have regular customers.

10. How did you overcome these obstacles?I treated my customer with honesty. I don’t lie to my customers. It takes time to let your customers trust you too.

11. What is the strength of your business?My medical skill.

12. What is the weakness of your business (if any)?No

13. What is your biggest trait or competitor?Other Chinese medicine shops in this district.

14. What strategy do you use to compete with your competitors?Don’t have any special strategy. As long as your pricing is reasonable, but most importantly you have to treat your customers with honesty, do not lie to them.

15. Who is your main targeted market?Everyone

16. Where do you see your business in ten years?I hope that my children would take over my business, and extend it.

17. Do you wish to extend your business to the international market?Probably not, as it is very hard to do so in Malaysia.

18. What do you hope for in this business?I hope that all my patients who visited could feel better and recover as soon as possible and the feel satisfy with the service I provided.

4.2 KH Herbal S hop

1. What’s your name?-

2. Who is the founder of this business? My employer, Liu Shi Rong

3. When did he start up the business?He started off this business around 20 years ago.

4. What inspired him to start the business? The main purpose of starting off a business is to earn money, so if the business is profitable, then it is good.

5. What are the main products or services being sold here?The main products are all the medicines and herbs.

6. How many branches do you have?No, but other partners have their own shops and branches.

7. How many workers do you have?10 workers

8. What is the estimated number of customers that visit your shop daily?I am not very sure, but I think around 100.

9. What are the obstacles when you first started your business?Customers. The number of customers is the biggest problem.

10. How did you overcome these obstacles?Promotion.

11. What is the strength of your business?Nothing special, but maybe our service is better.

12. What is the weakness of your business (if any)?No

13. What is your biggest trait or competitor?Chinese medicine shop, for example Hua Lian and Bao Jian.

14. What strategy do you use to compete with your competitors?Good service, reasonable pricing and provide a wider range of product.

15. Who is your main targeted market?Housewives.

16. Where do you see your business in ten years?He doesn’t have any plan.

17. Do you wish to extend your business to the international market?No.

18. What is his hope for this business?To extend his business.

RECOMMENDATIONS

Based on the analysis of the interview which we have conducted previously, we conclude

that Zhong Hua herbal shop has a higher amount of customers compared to KH herbal

shop. Although KH herbal shop is located in a more populated area and had a reputable

rating among the residence nearby, the amount of customers are constrained due to the

limited amount of space in their shop which enable customers to move around. Besides

that, their workers’ attitudes also degraded their quality of customer services. Therefore,

below are some recommendations for both the herbal shops to improve their business.

5.1 Zhong Hua Herbal Shop

Still standing strong at 50 years old, Zhong Hua herbal shop had braced itself against

modern medical competitors and stand strong among them. To further enhance the

business, Zhong Hua should consider strengthening their brand. Tactics such as

advertising through face-to-face communication around Teluk Intan should be included.

This is to allow locals and tourists to be aware of the significance of their herbal shop.

Furthermore, they should also improve and market the advantages of their varieties of

herbals. The next step is to consider opening their second and third branch on the

southern side of the state and slowly across Malaysia.

5.2 KH Herbal Shop

As KH herbal shop is located in the heart of population spot, they should seize the

opportunity to market its herbal shop as a trustworthy and reliable traditional herbal shop

in Kuala Lumpur. But first and foremost, they should improve the attitudes of their

workers in the shop. They did not seem to be passionate about their work and they do not

show appreciation to the customers. As a visitor to the shop, I felt unwelcomed and I

definitely would not like to visit their shop again due to their manners. Beside that, they

should improve the arrangement of the units in the shop. There is a very limited amount

of space to allow the customers to move around.

COMPARAITVE ANALYSIS

6.1 Comparative Analysis of The Two Businesses

As mentioned above, we interviewed two businesses from different locations

in Malaysia. The first business, which had already been here for 22 years, is the

Zhong Hua herbal shop in Taman Ros, Teluk Intan and our interviewee was Phoon

Kam Yau, who was the founder of Zhong Hua herbal shop. The second business,

which started 20 years ago, is KH herbal shop in Overseas Union Garden (OUG),

Kuala Lumpur and our interviewee was a employee of the shop. He did not want to

tell us his name but we knew that the founder of this shop is Mr. Liu Shi Rong. By

studying these two herbal shops, similarities as well as differences were observed.

Both herbal shops’ main products are herbs, medicines and provide health

consultancies service. However, their main targets of consumers are different. The

main targets of Zhong Hua herbal shop is people from all ages while the main

targets of KH herbal shop are housewives. This is the reason why there are

differences in numbers of consumers between these 2 shops. More than 100

consumers visited Zhong Hua herbal shop daily while there are only 50 to100

consumers who visited KH herbal shops daily.

The two shops established for different purposes. For the Zhong Hua herbal

shop the business was started to apply his study and treat people free from diseases.

According to Mr. Phoon, he travels to a lot of places to help those in need and give

them treatment after he completed his education. He began his business with an

intention of helping others and wishes them to live healthily. On the other hand the

owner of the KH herbal shop is realistic. He started this business just to earn money.

Like any other businesses, these two also faced some challenging obstacles

that prevented them from expanding their herbal shop. However it is not as bad for

Zhong hua herbal shop in Taman Ros, Teluk Intan. In the beginning, Zhong Hua

herbal shop had difficulties of obtaining regular customers. This causes the owner to

lose confident to his business. Even though there are difficulties, the owner himself

believes that this is a part of the route to success. So, he took it slowly and treated

every customer honestly and friendly. As for now, he just hopes that there is

someone who could take over and continue the business. On the other hand, KH

herbal shop in Overseas Union Garden (OUG), Kuala Lumpur is facing difficulties

because of the customer’s preferences. Customers wanted to be served politely and

friendly. They do not like the attitude of the employees even though they gave

attentive and quick services. The employees does not smile and treated customers

rudely that cause all the customers to leave.

Along with the challenges came the competitors, Zhong Hua herbal shop has

one main competitor, which is the Ren An herbal shop. Ren An herbal shop have

been around for 20-30 years and the owner knows a lot of people around that

district. On the other hand, KH herbal shop is located in the commercial area, so

there are a lot of competitors. The main competitors are Hua Lian herbal shop and

Bao Jian herbal shop. Both of the shop are a lot bigger than KH herbal shop so it is

quite hard to compete with.

In conclusion, Zhong Hua herbal shop in Teluk Intan is more commercially

stable than the KH herbal shop that is located in Overseas Union Garden (OUG),

Kuala Lumpur. This is mostly because they provide better services and serve

customers in a polite and friendly manner which people are attracted to. Unlike KH

herbal shop which is more realistic. All they care about is profits, not the customers.

6.2 Comparative Table

ITEM ZHONG HUA HERBAL SHOP

KH HERBAL SHOP

NUMBER OF COMPETITORS

There is one main competitor, who is Ren An herbal shop.

There are two main competitors, who are Hua Lian herbal shop and Bao Jian herbal shop.

BRIEF DESCRIPTIONS OF COMPETITORS

Ren An herbal shop- Another traditional herbal

shop around the same area- Sell almost same variety

of herbal- Also sell other daily need

product

Hua Lian herbal shop- Another traditional herbal

shop around the same area- Sell almost same variety

of herbal

STRATEGIES TO COMPETE WITH COMPETITORS

PricingReasonable and affordable Reasonable and affordable

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Face-to-face Communication Face-to-face Communication

Quality of service

Friendly and attentive, always serving with smiles.

Attentive and quick service but the attitude of the employee to the customer is terrible

Atmosphere

Good ventilation and space is not limited.

Crowded, hot and humid due to limited space and poor ventilation

WHAT ARE THE OBSTACLES FACED BY NEW BUSINESS?

One of the obstacles faced by the new business that wishes to enter the markets today is human resources. As for now, it is hard for a new business to build up a string human resource management in a short phase, as a lengthy time is needed to train the new workers. Besides that, the current market is quite subjugated, as there is quite an amount of similar business in the society. Thus, make it more challenging to start off a new business in this industry. Nevertheless, these difficulties can be

overcome if the newcomers are willing to work hard and think innovatively.

NATURE OF MARKET Both herbal shops are in Perfectly Competitive market.- The shops are selling same products, which is variety of herbal, both has relatively small market share that could not set any significant changes in the market price and that consumers could not get a exact data about the product and prices offered by the workers as all data are considered business secret.

ZHONG HUA HERBAL SHOP

SIMILARITIES KH HERBAL SHOP

Herbal and Chinese medicine

Main products soldHerbal and Chinese

medicine

Local Workers Local

No intention to expand to international market

Future planNo intention to expand to

international market

Provide services with honesty

Strategy Provide services

Zhong Hua Herbal Shop Differences Bao Jian Herbal Shop

Mr. Phoon Kam Yau established Zhong Hua in the year of 1986. He started off this business 22 years ago supported by his parents.

Founder and history

Established in the year of 1984 by Mr. Liu Shi Rong. He started off this business just wanted to earn money.

Zhong Hua herbal shop is located in a double storey building at Taman Ros,Teluk Intan right next to the oldest shop,Seng Huat.

LocationIs located at Overseas Union Garden (OUG), Kuala Lumpur.

Only one main branch Number of branches 5 around Kuala Lumpur

Medicine, treatment, and groceries

Types of product sold Medicine and herbal

9AM -8.30PM Business hour 9AM-10.30PM

Handle by the owner himself only, hoping for someone to take over the business

Business operationHandle by the owner himself and other employee.

Around 100 customers daily Number of customerAround 50 to 100 customers daily

People from all ages Targeted market Housewives

APPENDICES

Appendix 1: Minutes Meeting

Date: 14th November 2014 Time: 1300hr-1500hr Venue: Taylor’s Lakeside Campus

MEETING CALLED BY: Eng Shi Yi

NOTE TAKER: Tan Wei Zhen

TIMEKEEPER: Lai Tze Xiuan

ATTENDANCE:Eng Shi Yi, Tan Wei Zhen, Lai Tze Xiuan, Tan Jo Lynn, Khairul Jefri, Tan Yincy

2-HOUR CHOICE OF BUSINESS

Discussion:

1. Discussed about the types of business that we would like to do research on.

2. Searched the Internet to find more about the business, which has been operating for

10 to 15 years in Klang Valley and out of Klang Valley.

Conclussions:

1. Traditional herbal shops were chosen because both areas, Teluk Intan and Kuala

Lumpur, are highly populated with Chinese people who usually head for herbal shops

when they feel uncomfortable or feel sick.

Appendix 2: Minutes Meeting

Date: 21st November 2014 Time: 1300hr-1400hr Venue: Taylor’s Lakeside Campus

MEETING CALLED BY: Tan Jo Lynn

NOTE TAKEN: Khairul Jefri

TIMEKEEPER: Tan Yincy

ATTENDANCE:Tan Jo Lynn, Khairul Jefri, Tan Yincy, Eng Shi Yi, Tan Wei Zhen, Lai Tze Xiuan

1-HOUR DISCUSSION OF QUESTIONAIRES

Discussion:

1. Discussed about the interview questions about the business in Teluk Intan and

Klang Valley.

Conclusion:

1. Questions on history, founder, marketing strategies, branches of business,

challenges of business, scale of business and future plans of the shops.

2. Based on the sample questions provided by Miss Cassie, we further developed a

few more questions in order to have a more holistic approach about the business.

3.

Appendix 3: Minutes Meeting

Date: 25th November 2014 Time: 1200hr-1500hr Venue: Taylor’s Lakeside Campus

MEETING CALED BY: Eng Shi Yi

NOTE TAKEN: Tan Wei Zhen

TIMEKEEPER: Khairul Jefri

ATTENDANCE:Eng Shi Yi, Tan Wei Zhen, Khairul Jefri, Tan Jo Lynn, Lai Tze Xiuan, Tan Yincy, Ruben Hoo

2-HOURS DISTRIBUTION OF TASKS AND COMPILATION

Discussion:

1. Sort, analyze and interpret all the information, videos, photos and notes.

2. Distribute the teaks among members and compile the works via email after

completion of individual work.

Conclusion:

1. Tasks are divided equally to each member and compiled the report.

REFERENCES:

Globinmed. Malaysian Herbal Export Market Overview. Retrieved 2nd December 2014

from,

http://www.globinmed.com/index.php?

option=com_content&view=article&id=81081:malaysian-herbal-export-market-

overview&catid=45&Itemid=137