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Retail Management Chapter 2
Blue ocean strategy wikipedia
Retail Management Chapter 2
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In recent times it has been well documented and reported that the way in which retailing is changing. Alongside the former methods of ‘’bricks and mortar’’ stores, modern day retailers must now ensure that their goods and services are available by means of various streams, including websites and mobile apps. (Benady, D. 2014) But it is not only retailing which have changed; the consumer is becoming savvier and increasingly sophisticated. Consumers are expecting more from retailers and now expect a ‘’seamless shopping experience’’ however way in which they may interact with the retailer. (Benady, D. 2014)
One of the most profound decisions for a retailer manager is that of location, a poor business location can have long term adverse effects
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(Kim, W. C., Mauborgne, R. 2005) These two concepts include the Red oceans; representing the industries already in existence, namely the ‘’known market space’’, whereas the Blue oceans denote industries which may not be in existence and are not tainted by competition. (Kim, W. C., Mauborgne. R. 2005) The concept of the ‘’Blue Ocean Strategy’’ can be extremely beneficial for retail managers in terms of location, it can be used in order to aid an overall business strategy, namely: ‘’will the business create a new industry or re-create an existing industry?’’. A retail manager must denote whether the business will be based in an area where a large number of competitors lie or on the other hand use the ‘’Blue Ocean Strategy’’ and create a business whereby there is no known competitor, further breaking new ground. (Kim, W. C., Mauborgne, R. …show more content…
For a retail manager determining location for an organisation, it must be decided whether the business holds ‘’competitive advantage’’ and whether there is opportunity to outperform competitors and capture a share an existing market. (Kim, W. C., Mauborgne. R. 2005) If a retail manager was to determine that little to no existing competitors in a location it could prove massively influential on where to base a business. (Kim, W. C., Mauborgne, R. 2005)
4. Retail Locations and Management Issues
4.1 Town Centres/High Street – Much has been said in regards to the current state of town centres and high streets in the UK. It has been stated that there has been a year on year decline of 10% in terms of shoppers frequenting the high streets. (Wilmot, S. 2013) Though it may be true that a decline in the high street exists, in terms of location, town centres and high street still hold positive attributes including:
• Social space – Successful high streets can allow shoppers to socialise (shop, eat and relax)
• Community – High streets can work towards serving the needs of the local
In their 2004 article, “Blue Ocean Strategy”, W. Chan Kim and Reneé Mauborgne explain a new strategy they developed named “Blue Ocean”, meant as a metaphor from moving away from “red oceans” – traditional, current market competition – onto new, uncontested markets. In brief, a blue ocean strategy, as defined by Kim and Mauborgne, generates an environment where a company creates new products or services, sets the pace, and profits from the lack of traditional competition.(5) The authors are quick to point out “blue oceans were seldom the result of technological innovation per se; the underlying technology was often already in existence.” (5) Another key point Kim and Mauborgne make is that creating blue oceans build brands that can last decades.
In the recent years the development of the retail market has been greatly changed by external factors such as; political, economical, social, technology and legal (PESTL). This is also known as external macro environment, which concerns all businesses. This report will show what impact it has caused the retail business in the last forty years through these factors.
...owners losses in profit. Holloway Road manifests the same trend with increasingly more supermarkets. However, on this street, change is a frequent matter. Therefore, there is not the same nostalgia some people, such as members of the Municipal club on City Road, experience, and transformation of Holloway Road is accepted more easily.
Blue ocean strategy is a strategy that aims to make the competition irrelevant by finding ways to generate uncontested market space (Media Marketing, 2012). By implementing this strategy, a company is being forced to align their process related to production, costs and costs activities (Media Marketing, 2012). By utilizing the blue ocean strategy, Ambang Mata will achieve higher returns and also may continue to survive in the market.
A retail sales strategy must develop a thorough, well-integrated plan, in order to gain a competitive advantage in the market. A retail business develops a strategy to reach their target market and communicate their message in a meaningful way that consumers can relate too. (Gluck, S., 2014). Prior to communicating with consumers, retailers must assess market conditions and determine if their product or service will meet market needs. An analysis of the strength, weaknesses, opportunities and threats (S.W.O.T) gives a retailer perspective about the market and their own business allowing them to capitalize on the conditions. Once the (SWOT) is evaluated, the retailer sales strategy will account for both controllable and uncontrollable variables. Examples of controllable variable are: location, retail pricing of products and advertising. Examples of uncontrollable variables are: advances in technology, competition, and economic conditions. Succe...
Goss argues that developers and designers of the built environment, specifically shopping centers and malls, use the power of place and understanding the structural layout of the space to boost consumption of the retail profits. Shopping centers are separated from the downtown area of shopping, either by distance and/or design. These establishments emerge for many to be the new heart and location for public and social life. In his article The "Magic of the Mall": An Analysis of Form, Function, and Meaning in the Contemporary Retail Built Environment, Goss also argues that the regulation of the spaces within the mall creates an atmosphere of "community" rather than one that is "public". This article’s main argument is that developers manufacture an illusion of doing more than just shopping when designing malls and shopping centers.
Both modern and traditional retailers' will co-exist in India for some time to come, as both of them have their own competitive advantages. The kirana has a low- cost structure, convenient location, and customer intimacy whereas modern retail offers product width and depth and a better shopping experience. (Das, 2015)The study seeks to understand the competitive strategies followed by unorganized retailers in present competitive and fast changing environment.. The modern young people are mostly going to get purchase from Malls and shopping complex. So, there is stiff competition between organized and unorganized retailers. The study found that reducing price, to make available more choices and branded product are the major tool for unorganized retailers to face
Since the world’s economy has a major impact on the determination of market decisions, it is important for business owners to be informed of every detail to be. In order for them to make an intelligent investment decisions so, in the future they be prepared for any unexpected economical downturns. Also, it is essential to recognize the key risks a business may encounter and build up strategies to diminish them. Furthermore, a large quantity of the markets profit share around the world comes from the retail and wholesale industry. Even though they may fall into the same category in the financial system of the world it does not mean they are made with the same process and purpose. Owners of stores usually start up with retail and look forward in enlarging their business to wholesaling as experience is gained. In order, for business owners to expand their stores from retail to wholesale they are required to understand and be able to access various skills. First, owners must understand the difference between wholesale and retail. Secondly, there are some transitional changes that occur to the business which an entrepreneur must prepare for. Last, there are policies to follow in order not to commit some illegal transactions. By understanding these elements businesses would be more flexible and capable to endure unstable market conditions.
Retail industry emerges in many decades. Retail sectors has a significant relation between produces and consumers. As a second largest economy sector, retail industry provides wider job opportunities. Study shows that the sector contributes to almost 13%-17% of employment market, 25%-30% to business activity and about 8%-17% contribution to GDP. Retailing has been viewed as innovative and dynamic for the past 3 decades (Wrigley, N., 2010).
Additionally, Davis (1997: 66 - 69) explains that city centres and high streets are places where
An example of this is Baltimore’s Inner Harbor, which was in the street full with shopping centers and restaurants. Now shopping centers have change completely such as having a big and wide building fulfill of brand stores and restaurants.
Transformation took place along with the increase in number of shops. Back to the times before 18th century, customers does not have opportunities like changing-rooms, touching and feeling the product, display cases and mirrors which started with the innovations in retail industry from the late 17th century. The American merchants who had been working on importation and exportation started to particularise on either retail or wholesale by the eighteenth century. They inclined trading as general merchandise, who were centralised in popular cities, by selling wide range of products rather than particularizing in one or other type of merchandise and loan funding for retail transactions are provided in high extent. In Europe and in antipodes, the commerce archway which is multiple-vendor space operating under a single roof, began to emerge by late 18th century. One such archway in Paris, Palais-Royal, considered to be the most important market place is often regarded as earlies of the shopping archways and is gloried with cafes, bookshops and also two theatres which circumferences with gardens and entertainment venues. The clients of
Supporting these redevelopments is the intense shopping trend that has affected most parts of the world. Shopping is both the common denominator and the public face of these globalization projects: everyone can “buy into” the symbolic economy, pursuing their private dreams in public spaces. These new, mixed-use shopping developments are consumption spaces where urban residents can act as modern – or global – consumers and display their savvy and wealth.
This report illustrates how the changes of technology have had an impact on the ways consumers shop. While there are soaring demands for consumers who shop online; there are also consumers who still much prefer the old fashioned method to walk into a shop and take the experience to physically search for the items they want.
In Pretoria and Johannesburg, there are currently in excess of 60 different shopping malls. As stated, Farrag et al., (2010:96) is of the opinion that all shopping malls have certain homogeneity. However, each country has its own challenges in its shopping mall retail sector, such as socio-economic structure, the population compilation, and distinctive shopping cultures. Reflecting on the last two decades, the shopping mall in South Africa has been influenced by major social, economic, and political changes. In the 1980s, the city centre was the business and shopping hub of most towns and cities. Subsequently, factors such as crime and dereliction of the inner cities caused a shift and South Africa’s retail space experienced decentralisation; shopping moved from the city centre to suburban areas and to shopping malls in these suburban areas (Ligthelm,