The Internet has drastically changed the way in which customers interact with businesses. Although the customer interface has changed, operations management remains a crucial element in the success of Internet retailing.
The retail sale of books is an industry with a long history. In the recent past, bookstores have followed a typical path of retail consolidation. The traditional neighborhood bookstore flourished for many years but was challenged by small chains. Then, both of these types retailers were overcome by the large big box chains such as Borders and Barnes and Nobles with thousands of stores across the USA. Now, the big box chains are faced with competition from Internet bookstores such as Amazon.com.
In the following questions, compare and contrast the operations infrastructures needed to support a “brick” traditional thousands of store chain such as Barnes and Nobles (excluding the internet component) and a “click” internet only (such as Amazon.com but only books) in the bookstore industry.
There is no need to find out specific information about companies, but discuss your expectations of the differences between these types of bookstore operations. Please state your general assumptions about each business. Please be sure to address operations issues in your answers.
1.a Compare and contrast a “bricks” non-internet national store book business and a “clicks” internet only bookstore on the following operations dimensions: Order winners, type of inventory (cycle, safety stock, anticipation, pipeline), and supply chain design.
1.b Discuss the similarities and difference in the components that determine capacity for both “bricks” and “clicks”? What type of capacity utilization would you anticipate for each?
1.c A retiring professor wants to open a local, one location bookstore. How can this “retired professor’s bookstore” compete with the new “clicks” model? What competitive capabilities or order winners will need to be developed? How will “retired professor bookstore” compare with the “clicks” model in terms of supply chain and inventory?