AMRE700 Retail Enterprise and Management : Technology and Appliances

1Provide an overview of both retail enterprises. You should ensure that you describe the location, ownership structure, retail channels and the retail mix for each store visited.

2Identify and criticallyevaluate the following elements of the retail mix for each store using retailing enterprise concepts: 

(a)Merchandise Mix (variety and assortment)
(b)Ownership structure
(c)Location(s)
(d)Channel(s)
(e)Pricing Strategy

3Based on your store visit and your secondary researchidentify and critically evaluatethe source(s) of competitive advantage for each of the two (2) retailers that you visited in task 1 above. You should refer to retailing enterprise concepts and/or management concepts in your critical evaluation.

4Apply retailing enterprise concepts and/or management concepts to suggest two (2) improvements that each of the two (2) retailers that you visited in task 1 above could make to enhance their competitive advantage.

5Choose one (1) of the retailers that you identified in task 1 above. Critically evaluate the potential trade-off between responsiveness and efficiency in supply chain management for your chosen retailer. You will need to support your answer with reference to the specific nature of the retailer’s merchandise.

Noel Leeming is one of the leading consumer electronics and appliances retailers of New Zealand ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The company is the brand retailer of the Noel Leeming group. The company offers the widest range of electronic goods and appliances of the top brands. The various products offered by the retailer include computers and tablets, phones and GPS, televisions, audio speakers, cameras, digital wearables ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Along with these, the retailer also sells the kitchen appliances. The household appliances, drones and digital games, digital toys, health and personal grooming kits are also offered to the customers. The Noel Leeming store is located in the Palms mall, in New Zealand. The Palms is one of the biggest shopping mall in New Zealand and the Noel Leeming store located at the Palms mall is one the biggest advantage for the store ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). This is because, a huge footfall is seen at the Palms mall and the store being located there, has an added advantage of attracting a huge number of customers.

The organizational structure of the Noel Leeming is tall. There are a huge number of hierarchies, since it is a large organization and the tall organizational structure is suitable in a large business organization (Grant, 2016). The ownership structure of the company is formed with a CEO and a large number of board members. Australian-base private equity firm owns the Noel Leeming group. The CEO of the company is Tim Edwards ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The main purpose of the retailing mix is to address the needs of the customers successfully, along with formulating strategies. The coordination of the various operations, along with responding promptly to the competitors is the main purpose of the retail mix (Boone & Kurtz, 2013). The components of the retail mix include the product, place, promotion, price, presentation, personnel. The products of the Noel Leeming are of wide variety and of various international and local brands. The customers are given a wide variety of choice from a wider range of products, such that they are able to make their choice successfully. The prices are competitive and same across all the Noel Leeming stores (Khan, Alam & Alam, 2015). However, the store often offers heavy discount to the customers, thus attracting a huge number of customers. The promotional activities that are taken up

Overview of Apple store

Apple Inc. Is one of the top American multinational company that develops and sells consumer electronic products, computers and software ("Apple (New Zealand)", 2017). The hardware products that Apple develops and sells include the iPad tablet computer, the Mac personal computer, iPod portable media player. Along with these, the Mac OS and the iOS operating systems are also made and sold by Apple. The CEO of Apple is Steve Jobs. The company is the world’s largest information technology company by revenue and the second largest mobile phone manufacturer in the world, after Samsung. The products of Apple also include smart watches, TVs, along with iPhones ("Apple (New Zealand)", 2017). The Apple store is located at the Palms Mall at New Zealand. The location of the store facilitates the sale, since the mall itself attracts a huge number of customers and those customers are also an essential part of the Apple store. Thus, the store is facilitated by the location in the Palms mall.

The organizational structure of Apple is one of the main contributing factors for the organizational success and innovation. In case of Apple, the organizational structure is the traditional hierarchy one, with a large number of intermediate hierarchies ("Apple (New Zealand)", 2017). The leadership in the company is strong and ensures high scope of innovation. One of the most significant features of Apple is the organizational structure of the Spoke-and wheel hierarchy, function based grouping and product based grouping.

The retailing mix is important for Apple. A wide variety of product is available. However, unlike Noel Leeming, a wide range of brand is not available at the Apple store. With the effective use of the retailing mix, the choices and demands of the customers are identified, along with the need of innovation as required to gain competitive advantage.

2. Critical evaluation:
3. Merchandise mix

Noel Leeming

Noel Leeming is one of the largest retailers of the electronics appliances of New Zealand. The merchandise that the company offers includes computers and tablets of a variety of companies, with wide range of brands and price ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The phones and GPS that are available vary in the brands and price, thus ensuring that the merchandise is affordable by all. Televisions and audio speakers are also available, along with a good range and variety of cameras. Moreover, digital wearables are also available at the store, at attractive price (Yoffie & Cusumano, 2015). The Noel Leeming also sells the home appliances and kitchenware. The merchandise mix of Noel Leeming is important since it highlights the demands of the customers and offers them with a wider variety of choice of the items, brands as well as price ranges ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The merchandise mix of Noel Leeming is much wider than that of the Apple store located at the Palms Mall. This is because, the Noel Leeming store offers a wider variety of brands and prices to the customers, thus successfully ensuring the fulfilment of the customer demands, as well as gain competitive advantages. The merchandise mix of Noel Leeming is attractive and the variety enhances the customer base of the store. However, since the variety is wide and goods of various brands are available, hence competition with the similar stores is also high.

Apple

In case of the Apple store, the merchandise mix is wide; however, all the products are of the same company Apple. The products of Apple that the store offers to the customers include Mac operating system, iOS, iPad for business operations, iPod for listening to music, iPhones, smart television as well as online support for the products of Apple ("Apple (New Zealand)", 2017). The merchandise mix that is offered by the company includes the products of Apple and thus, as compared to that of Noel Leeming, the merchandise mix is low. The product mix of Apple is as follows:

Breadth- Mac, iPod, iPad, iPhone, Apple TV, software to support the products of Apple.

Line- Mac, Macbook, Macpro, iPad/2/3/air/mini, iPod/ Classis/Shuffle/Nano/touch, iPhone 3G/ 3GS/4/4S/5/5C/5S/6/6 plus/7/8, iOS, OS X

The merchandise mix is low in the Apple store, since only products of Apple are available. Thus, the potential customers are only the ones, who prefer to buy Apple products.

1. Ownership structure

Noel Leeming

The organizational structure of Noel Leeming is a tall one. The hierarchy level is high, along with various intermediate hierarchies. Since the company is a large one, hence the organizational structure is a tall one and is appropriate for the organizational success. The current CEO of Noel Leeming is Tim Edwards ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The board of members are formed by the general manager commercial, Ged Taylor, the chief financial officer, Paul Judd. He is responsible for the accounting and transactional services. The General Manager of the marketing department is Maryanne Smith. She is responsible for the marketing and the online promotions. Jason Bell is also another board member, in charge of the merchandise. Garth Brown is responsible for the operations department. The general manager of the people support and customer services is Matt William. He is responsible for advisory, learning and development as well as the recruitment and selection of the staffs. Sean Stephens is the general manager of the retail services ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The responsibilities of the various departments are distributed equally, such that each department could be taken care by experts, thus ensuring efficiency of work. Thus, each of the department, namely the operations department, accounts department, people management department, marketing department works efficiently under the supervision of each expert. The organizational structure is appropriate for the successful working of Noel Leeming.

Apple

The organizational structure of Apple has a key contribution in the organizational success. The structure of the organization creates opportunity for growth and innovation in the business. In Apple, the organizational structure follows the traditional hierarchy, along with some key elements that distinguishes the company from the others, and makes it the world’s largest information technology company in the world (Heracleous, 2013). The heights of success that the company has reached, is seen as the success of the leader and CEO Steve Jobs ("Apple (New Zealand)", 2017). However, under the leadership of Tim Cook, few changes have been made in the organizational structure, in order to meet the organizational demands. The unique features of the organizational structure of Apple include the following:

1. Spoke-and-wheel hierarchy

This unique feature in the organizational structure of Apple was incorporated under the leadership of Tim Cook. In the past, under the leadership of Steve Jobs, all decision making was done under the supervision of the CEO. However, under Tim Cook, there is more collaboration among the various departments such as the software team as well as the hardware team and the vice presidents have more autonomy that earlier. Thus, the orgniaztaional structure is flexible and follows the spoke and wheel structure, where Tim Cook is at the centre of the spoke and wheel structure ("Apple (New Zealand)", 2017).

2. Function based grouping

The top management level of Apple has a function based grouping structure. This is derived from the functional type of the structure of the organization. Each of the vice-presidents handles a different business and reports to Tim Cook. For example, each of the departments, such as industrial design, marketing and retail has a different senior vice president.

3. Product based grouping

The lower level employees of the company have a structure of the product-based grouping. Under each senior vice president, there are a number of vice presidents for the various products. Thus, each of the vice presidents and senior vice-presidents are liable and answerable for each product, ensuring better management (Pearlson, Saunders & Galletta, 2016).

Thus, the organizational structure of Apple is more organized than that of Noel Leeming. The innovation and the leadership qualities that Apple has displayed, owes its success to the organizational structure.

1. Location

The location of both the stores Noel Leeming and Apple is the Palms Mall. The location of any store is important for determination of the effectiveness of the amount of sale. The Palms Mall is a central location of New Zealand. Hence, the footfall of the people, along with variety of the people visiting the place is large (Laudon & Laudon, 2016). Since both the stores are located at the same place, hence both get the advantages of the large number of people coming to the stores for buying. The location for both the stores is a major advantage in the enhancement of business.

1. Channels

Noel Leeming

The distribution channel has a key role to play in reaching to the target customers. In case of Noel Leeming, the company uses the distribution channel of franchise to reach their potential customers, all over the world. The franchised stores work with equal diligence and perseverance as that of the retail stores ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Moreover, the company also sell their products directly to the customers, such that the consumers are able to select from a wide variety of products (Parsons & Wilkinson, 2015). Thus, the Noel Leeming store is dependent on a variety of suppliers, enhancing the supplier’s power.

Apple

The apple stores do not encourage franchise of their products. Only authorised stores sell the Apple products, directly to the customers. The authorised stores sell authorised products with copyright ("Apple (New Zealand)", 2017). Thus, the company is able to reach the potential customers directly. The customers, on the other hand can communicate directly to the company Apple, thus engaging in effective communication. Since the distribution channel involves direct sale to the customers, hence the dependency of the suppliers are less.

1. Pricing strategy

Noel Leeming

The pricing strategy of Noel Leeming is competitive and according to the pricing of the other contemporary competitors. The price of all the products of Noel Leeming is same across all the stores. Moreover, since the electronic appliances are procured directly from the manufacturing companies, Noel Leeming gets the products at a reduced price and is able to sell them to the customers at a reduced cost ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Hence, high amount of discounts are given to the customers. The company also uses the competitive pricing strategy. In competitive pricing strategy, the prices of the products are set at a level, to be in competition with the other contemporary companies. The competitive pricing strategy is important and effective in gaining competitive advantages. The pricing strategy taken up by the company is effective in the enhancement of the business.

Apple

In case of the Apple stores, the prices of the products are fixed and only certified retailers are authorised to sell the products of Apple. Franchise of the products of Apple is not given to the unauthorised dealers, in order to ensure that only genuine products are sold, with authorised software ("Apple (New Zealand)", 2017). Apple does not use competitive pricing strategy or price skimming. They have fixed price of the products all over the world. The pricing strategy of Apple is directed towards attracting customers of the elite class. Thus, the people with limited affordability are not the target customers of Apple.

3. Competitive advantages for the two retailers

Noel Leeming

The competitive advantages that the company has gained over the other competitors are as follows:

1. High discount: Since most of the products sold by Noel Leeming are procured directly from the manufactures, hence the store is able to give high discounts to its customers. The high discount attracts thousands of customers, thus giving competitive advantage to the company.
2. Wide variety: A wide variety of products of various brands is available at the store of Noel Leeming. This wide variety gives the customers a wider choice and hence the store gains competitive advantages over the other contemporary stores.
3. Large customer base: The store offers products of wide variety and price. Hence, the company, with loyal customers, obtains a large customer base. This helps the Noel Leeming store to gain competitive advantages.
4. Affordable: The wider range of the products and a variety of brands for the same products makes the Noel Leeming store affordable for a variety of customers. Thus, fair price, high discounts and affordability are factors that help in gaining competitive advantages.

The competitive advantage of Noel Leeming is beneficial for the enhancement in the business as well as reaching of new customers, with their variety and affordability.

Apple

Apple is one of the largest information technology companies in the world. It has gained competitive advantages over the other contemporary companies, due to the following:

1. Closed circle:One of the main advantages that Apple has over its competitors includes the products and the protected ecology that the company maintains. Apple manufactures its own software, to be compatible with its hardware. Hence, within the protected ecology, no other company is able to penetrate. For example, no other company is licensed to produce the Mac OS and the other software, which are compatible with the products of Apple. Thus, competition is nullified. Moreover, a survey highlighted the fact that the iPhone owners cannot imagine to use any other phone, thus reducing the competition and ensuring competitive advantage of Apple.
2. Brand appeal: The brand appeal of Apple among the potential customers is high and they are attracted to the products of Apple, due to its features. The users of the products of Apple are loyal and do not shift their choice easily (Sims & Mara, 2016). Moreover, for the users, consider the use of the products of Apple as pride and luxury, hence providing competitive advantage to the company.
3. Innovation: The innovation quotients of the products of Apple are high. The innovative features of the products of Apple ensure that they gain competitive advantages over the other contemporary companies.
4. Customer services: The customer services that are provided by the company satisfy the needs of the customers. Moreover, the customer services executive, thus retaining the customers, looks into, the needs of customers diligently. The prompt customer services are effective in gaining competitive advantages over the others.

The competitive advantage of Apple is essential for attracting more customers and ensuring that remain in a leadership position.

4. Retailing enterprise concepts and management concepts as recommendation

Noel Leeming

The retailing enterprise concepts that are recommended for Noel Leemings are as follows:

1. Innovation: It is recommended that innovation should be incorporated in the business of Noel Leeming, such that the company is able to flourish faster (Pitelis & Teece, 2015).
2. Expansion: Noel Leeming should venture in expansion in the Asian market.

The management concepts are recommended for Noel Leemings are as follows:

1. Motivation: Motivating the employees to work diligently and rewarding the employees effectively could be recommended for Noel Leeming (Danaher, Sajtos & Danaher, 2016).
2. Online presence: The online presence is effective and needs to be considered as a management concept for Noel Leeming.

Apple

The retailing enterprise concepts that are recommended for Apple are as follows:

1. Franchising: The Company might consider expansion in various countries through franchisee given to various authorised vendors.
2. Advertisement: Enhancement in the advertisements and promotions are recommended, in order to promote the products of Apple (Ford, 2016).

The management concepts that are recommended for Apple are as follows:

1. Employee satisfaction: The Company needs to ensure that employee satisfaction and employee retention is given adequate importance.
2. Incorporating needs of the customers: The needs of the customers are to be identified and incorporated in the products of Apple.
3. Critical evaluation of potential trade-off between responsiveness and efficiency in supply chain management

The potential trade-off between the responsiveness and the efficiency in the supply chain management of Noel Leeming is high. The supply chain management of Noel Leeming is efficient. The products that are sold by Noel Leeming are directly procured from the companies ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Thus, with a large number of suppliers, it is important to ensure that the products are supplied on time. Moreover, since the company deals with electronic goods, hence it is essential that the goods delivered, are not damaged (Hagiu, 2014). The damaged products are returned to the companies, thus ensuring efficient supply chain management ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The potential trade-off is high and the responsiveness of the company is quite strong. The efficient supply chain management ensures that the demand for the products is met with that of the supply of the products for the manufacturers. The potential trade-off between responsiveness and the efficiency in the supply chain management is high and ensures the proper working of the store of Noel Leeming. The delay in the supply chain would deflect the customers from the store.

References

Apple (New Zealand). (2017). Apple (New Zealand). Retrieved 12 September 2017, from https://www.apple.com/nz/

Boone, L. E., & Kurtz, D. L. (2013). Contemporary marketing. Cengage learning.

Danaher, P. J., Sajtos, L., & Danaher, T. S. (2016). Does the reward match the effort for loyalty program members?. Journal of Retailing and Consumer Services, 32, 23-31.

Ford, R. (2016). Smart Grid Edge Technologies Case Studies of Early Adopters.

Grant, R. M. (2016). Contemporary Strategy Analysis Text Only. John Wiley & Sons.

Hagiu, A. (2014). Strategic decisions for multisided platforms. MIT Sloan Management Review, 55(2), 71.

Heracleous, L. (2013). Quantum strategy at Apple Inc. Organizational Dynamics, 42(2), 92-99.

Khan, U. A., Alam, M. N., & Alam, S. (2015). A Critical Analysis of Internal and External Environment of Apple Inc. International Journal of Economics, Commerce and Management, 3(6), 955-961.

Laudon, K. C., & Laudon, J. P. (2016). Management information system. Pearson Education India.

Parsons, A., & Wilkinson, M. H. (2015). Retailing in New Zealand: Where Are We and Where To Next?. In European Retail Research (pp. 141-160). Springer Fachmedien Wiesbaden.

Pearlson, K. E., Saunders, C. S., & Galletta, D. F. (2016). Managing and Using Information Systems, Binder Ready Version: A Strategic Approach. John Wiley & Sons.

Pitelis, C. N., & Teece, D. (2015). Dynamic capabilities, the multinational corporation, and (capturing co-created value from) innovation.

Sims, A., & Mara, L. (2016). Unfair online contract terms in New Zealand: Evaluating the effect of regulatory change.

Welcome to Noel Leeming | Technology & Appliances in NZ. (2017). Noel Leeming. Retrieved 12 September 2017, from https://www.noelleeming.co.nz/

Yoffie, D. B., & Cusumano, M. A. (2015). Strategy Rules: Five Timeless Lessons from Bill Gates, Andy Grove, and Steve Jobs. HarperBusiness.