Question Details

Operation Management Homework

Traditional Department Store A traditional department storechain is facing greater competition from full-line discount stores,specialty stores, and Web-based retailers. This firm is especiallyconcerned about the heightened vulnerability of its furnituredepartment to competition from a variety of formats. It is worriedabout the effects of the low prices and immediate availability ofgoods at stores like Ikea, as well as the availability of in-homedecorator services at independently-owned home furnishingstores.

The chain’s furniture is displayed in room settings. This formatbetter enables shoppers to conceptualize what the furniture willlook like in their homes. It also results in the sale ofaccessories such as lamps, paintings, and throw pillows.

Much of the chain’s furniture is moderately priced,well-designed, and available in a variety of fabrics and finishes.The chain relies on well-known manufacturers with excellentreputations for product quality, as well as delivery timecommitments. Unlike many discounters, all of the chain’s furnitureis available in a variety of sizes, fabrics, and finishes. Also,unlike Ikea or category killers such as Bed Bath and Beyond, thefirm does not sell low-quality “ready-to-assemble” furniture.

To reduce price competition, the department store chaintypically requires its suppliers to sell it exclusive merchandise.This often consists of a selection of unique fabrics, finishes, legdesigns, and even sizes. In other cases, the firm requires that itsvendors assign unique model numbers to its goods. Thus, a customerseeing a sofa in a department store would either be unable topurchase a comparable item at a lower price or have a difficulttime locating the good.

The chain’s employees come from a variety of backgrounds. Someof its staff have either significant experience as interiordecorators or have a flair for decorating. While others may beexcellent salespeople, they have much less knowledge of fabrics andare less comfortable developing room arrangements or selectingcoordinating or contrasting fabrics.

Although many specialty stores offer in-home interior decoratingassistance, Web-based merchants and discounters do not provide thisservice. While the fee for these services vary, many specialtystores charge a fee of $100 to $200 per visit to confirm that themerchandise ordered is appropriate for one’s home. This fee may bewaived if a purchase exceeds a given level (such as $2,500). Thedepartment store chain offers only in-storebased services (such asconfirming that the sofa is the proper color based on viewing afabric sample of a chair that the client owns).

Complete The Overall Strategy for the particularorganization:

Overall Strategy Controllable variables

· Goods/service strategy

· Location strategy

· Pricing strategy

· Promotion strategy

Uncontrollable variables

· Consumer environment

· Competitive environment

· Legal environment

. Economic environment

. Technological environment

Overall Strategy. Overall, this section should provide detailedinsight and description as to how the organization is going toreach its objectives. Controllable variables and strategic actionsfor the retailer should be detailed. Consider what opportunitiesamong the 4P’s that the retailer can capitalize on to grow itsbusiness. Provide substantial detail to support your strategicrecommendations. Uncontrollable variables should be analyzed fortheir potential impact on the retailer’s business decisions.Recommendations as to how the retailer can address uncontrollablevariables are crucial.