• Journal of Distribution Research
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• v.17 no.5
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• pp.1-23
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• 2012

The conflict between major corporations and small and medium-sized businesses is being aggravated, the trickle down effect is not working properly, and, as the controversy surrounding the effectiveness of the business limiting system continues to swirl, the plan proposed to protect the business domain of small and medium-sized businesses, resolve polarization between these businesses and large corporations, and protect small family run stores is the suitable business type designation system for small and medium-sized businesses. The current status of carrying out this system of selecting suitable business types among small and medium-sized businesses involves receiving applications for 234 items among the suitable business types and items from small and medium-sized businesses in manufacturing, and then selecting the items of the consultative group by analyzing and investigating the actual conditions. Suitable business type designation in the service industry will involve designation with priority on business types that are experiencing social conflict. Three major classifications of the service industry, related to the livelihood of small and medium-sized businesses, will be first designated, and subsequently this will be expanded sequentially. However, there is the concern that when designated as a suitable business type or item, this will hinder the growth motive for small to medium-sized businesses, and designation all cause decrease in consumer welfare. Also it is highly likely that it will operate as a prior regulation, cause side-effects by limiting competition systematically, and also be in violation against the main regulations of the FTA system. Moreover, it is pointed out that the system does not sufficiently reflect reverse discrimination factor against large corporations. Because conflict between small to medium sized businesses and large corporations results from the expansion of corporations to the service industry, which is unrelated to their key industry, it is necessary to introduce an advanced contract method like a master franchise or local franchise system and to develop local small to medium sized businesses through a franchise system to protect these businesses and dealers. However, this method may have an effect that contributes to stronger competitiveness of small to medium sized franchise businesses by advancing their competitiveness and operational methods a step further, but also has many negative aspects. First, as revealed by the Ministry of Knowledge Economy, the franchise industry is contributing to the strengthening of competitiveness through the economy of scale by organizing existing individual proprietors and increasing the success rate of new businesses. It is also revealed to be a response measure by the government to stabilize the economy of ordinary people and is emphasized as a 'useful way' to revitalize the service industry and improve the competitiveness of individual proprietors, and has been involved in contributions to creating jobs and expanding the domestic market by providing various services to consumers. From this viewpoint, franchises fit the purpose of the suitable business type system and is not something that is against it. Second, designation as a suitable business type may decrease investment for overseas expansion, R&D, and food safety, as well negatively affect the expansion of overseas corporations that have entered the domestic market, due to the contraction and low morale of large domestic franchise corporations that have competitiveness internationally. Also because domestic franchise businesses are hard pressed to secure competitiveness with multinational overseas franchise corporations that are operating in Korea, the system may cause difficulty for domestic franchise businesses in securing international competitiveness and also may result in reverse discrimination against these overseas franchise corporations. Third, the designation of suitable business type and item can limit the opportunity of selection for consumers who have up to now used those products and can cause a negative effect that reduces consumer welfare. Also, because there is the possibility that the range of consumer selection may be reduced when a few small to medium size businesses monopolize the market, by causing reverse discrimination between these businesses, the role of determining the utility of products must be left ot the consumer not the government. Lastly, it is desirable that this is carried out with the supplementation of deficient parts in the future, because fair trade is already secured with the enforcement of the franchise trade law and the best trade standard of the Fair Trade Commission. Overlapping regulations by the suitable business type designation is an excessive restriction in the franchise industry. Now, it is necessary to establish in the domestic franchise industry an environment where a global franchise corporation, which spreads Korean culture around the world, is capable of growing, and the active support by the government is needed. Therefore, systems that do not consider the process or background of the growth of franchise businesses and harm these businesses for the sole reason of them being large corporations must be removed. The inhibition of growth to franchise enterprises may decrease the sales of franchise stores, in some cases even bankrupt them, as well as cause other problems. Therefore the suitable business type system should not hinder large corporations, and as both small dealers and small to medium size businesses both aim at improving competitiveness and combined growth, large corporations, small dealers and small to medium sized businesses, based on their mutual cooperation, should not include franchise corporations that continue business relations with them in this system.

• Journal of Intelligence and Information Systems
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• v.18 no.4
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• pp.19-42
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• 2012

Consumer consumption patterns are shifting rapidly as buyers migrate from offline markets to e-commerce routes, such as shopping channels on TV and internet shopping malls. In the offline markets consumers go shopping, see the shopping items, and choose from them. Recently consumers tend towards buying at shopping sites free from time and place. However, as e-commerce markets continue to expand, customers are complaining that it is becoming a bigger hassle to shop online. In the online shopping, shoppers have very limited information on the products. The delivered products can be different from what they have wanted. This case results to purchase cancellation. Because these things happen frequently, they are likely to refer to the consumer reviews and companies should be concerned about consumer's voice. E-commerce is a very important marketing tool for suppliers. It can recommend products to customers and connect them directly with suppliers with just a click of a button. The recommender system is being studied in various ways. Some of the more prominent ones include recommendation based on best-seller and demographics, contents filtering, and collaborative filtering. However, these systems all share two weaknesses : they cannot recommend products to consumers on a personal level, and they cannot recommend products to new consumers with no buying history. To fix these problems, we can use the information which has been collected from the questionnaires about their demographics and preference ratings. But, consumers feel these questionnaires are a burden and are unlikely to provide correct information. This study investigates combining collaborative filtering with the centrality of social network analysis. This centrality measure provides the information to infer the preference of new consumers from the shopping history of existing and previous ones. While the past researches had focused on the existing consumers with similar shopping patterns, this study tried to improve the accuracy of recommendation with all shopping information, which included not only similar shopping patterns but also dissimilar ones. Data used in this study, Movie Lens' data, was made by Group Lens research Project Team at University of Minnesota to recommend movies with a collaborative filtering technique. This data was built from the questionnaires of 943 respondents which gave the information on the preference ratings on 1,684 movies. Total data of 100,000 was organized by time, with initial data of 50,000 being existing customers and the latter 50,000 being new customers. The proposed recommender system consists of three systems : [+] group recommender system, [-] group recommender system, and integrated recommender system. [+] group recommender system looks at customers with similar buying patterns as 'neighbors', whereas [-] group recommender system looks at customers with opposite buying patterns as 'contraries'. Integrated recommender system uses both of the aforementioned recommender systems to recommend movies that both recommender systems pick. The study of three systems allows us to find the most suitable recommender system that will optimize accuracy and customer satisfaction. Our analysis showed that integrated recommender system is the best solution among the three systems studied, followed by [-] group recommended system and [+] group recommender system. This result conforms to the intuition that the accuracy of recommendation can be improved using all the relevant information. We provided contour maps and graphs to easily compare the accuracy of each recommender system. Although we saw improvement on accuracy with the integrated recommender system, we must remember that this research is based on static data with no live customers. In other words, consumers did not see the movies actually recommended from the system. Also, this recommendation system may not work well with products other than movies. Thus, it is important to note that recommendation systems need particular calibration for specific product/customer types.