International Journal of Retail & Distribution Management

Question: Describe about the International Journal of Retail Distribution Management? Answer: Introduction: Zhang (2012) stated that supply chain activities in retail organization impact on the quality of products and services. Ralston et al. (2013) opines that business growth of an organization which work in retail market depends on the effectiveness of its supply chain model. The supply chain management can be considered as the combination of several sub processes including receiving products from suppliers, transporting to distribution center, storing and handling materials and delivering final product to customer (Schonsleben, 2012). Pienaar and Vogt (2012) stated that each activities in supply chain management impacts differently on each stakeholder of the organization. However, Myerson (2012) suggested that different organizations develop different supply chain models according to their requirement. Although the organizations in retail sector uses different models for executing their activities in logistics operation, all these activities aim to improve common performance objectives such as quality of product, service delivery time, speed of delivery , cost of product and flexibility of handling products (Rutner et al , 2012). The current assignment deals with analysis of the supply chain management system used by Tesco. Tesco is one of the largest retailers in UK (Tesco.com, 2015). However the organization operates in other European and Asian countries also. The retail network of Tesco can be considered as one of the largest retail networks. The organization modified their supply chain management activities several times for meeting the requirements of stakeholders. However in this a assignment continuous replenishment model of supply chain is discussed. Supply chain activities of Tesco: Tesco management implemented continuous replenishment model of supply chain in 1999. This continuous replenishment approach uses a flow system for collecting data regarding stock of products (Zhang, 2012). On other hand implementation of this new system enabled the management of Tesco to send daily orders to suppliers (Zhuang, 2014). Figure 1: Supply chain activities in Tesco Inbound Logistics: Receiving orders from suppliers and storing at depots: The task of receiving orders from suppliers can be considered as combination of three separate tasks- In store management, management of retail network and cross docking. Tasks Quality Speed Dependability Flexibility Cost In store management Improves as products are not stored for long time Speed of delivery to customer increases as products are ordered before running out Dependability improves as products are always available Mix flexibility improves as stuck is always maintained Volume and delivery flexibility increases as availability of products increases Cost of operating reduces as all activities are pre planned Network management Improves as separate storage systems are used on basis of product category Speed of delivery to customer increases as new storage locations are added with existing network Availability of products improves due as storage capacity improves Product , volume and delivery flexibility improves as availability increases Cost of operation decreases as efficiency of storage system improves. Implementation of flow through activities Quality of products improves as time of storing reduces Speed of delivery increase as finished products are received Dependability improves due to increase in product availability Volume and delivery flexibility improves as products become available in less time Cost reduces as storage time reduces Receiving products from supplies and performance objectives Table 1 reflects how performance objectives are met by the activities in storage process of Tesco. In store management: Retail store managers of Tesco regularly analyses data on buying behavior of customers. Apart from this the managers also analyze the capacity of a store for developing stock of products. According to Klug (2014) analyzing the capacity of store is important to maintain quality of stored products. As Tesco operates in different country across world capacity of all stores is not same. On other hand, nature of customers also varies greatly at different countries. However managers of each store in the retail network of Tesco separately determines the buying nature of customers and storage capacity. On basis of their findings, they send orders to the suppliers daily. Network management: Management of Tesco continuously adds new locations for increasing efficiency of the storage activities. Addition of new sites in existing network enables the management to increase their storage capacity regularly. However the management also focuses in increasing the number of frozen centers for storing frozen parts of composite elements separately Regional centers of Tesco also contains cross docking facility for improving the storage system for refrigerated materials. Implementation of flow through activities: Tesco management uses flow through approach for reducing the complexity in storage system. Manager of the organization prefers to get finished products from suppliers. As the organizations receive finished products, these can be placed in stores immediately after receiving (Grant, 2012). Performance objectives: Analysis on the tasks conducted by Tesco for storing products indicates that this approach of Tesco management is effective for improving quality of products. As the management determines daily requirements of products, stock never runs out. Apart from this as managent send orders according to the capacity of a store products do not required being stored for a long time. On other hand analyzing requirements daily ensures that availability of product is always high (Fatieiev and Zaporozhets, 2014). It also ensures that the requirements of customers can be met even if the demand for a product rises certainly (Forslund, 2014). The activities for network management lead to increase in storage capacity. As these activities enable management to store different products in different locations on basis of product nature, quality improves. On other hand, increase in storage capacity makes the products more available. As a result, dependability, flexibility and speed of delivery also improve. Use of separate storage systems and increasing storage capacity may increase the cost of operation initially (Crocker et al., 2012). However it reduces later as the storage system becomes more effective. Primary distribution: Task Quality Speed Dependability Flexibility Cost Sharing information with supplier Does not impact on quality directly Increases speed of delivery as availability of products increases Ensures uninterrupted flow of products as suppliers understand requirements of customers Mix, product and delivery flexibility increases as the flow of product becomes uninterrupted Cost reduces as suppliers can understand requirement for any product using shared system Collection of products from suppliers Use of advanced infrastructure makes product handling process easier Indirectly increase speed of delivery to customer Does not impact on dependability directly Does not impact on flexibility directly Cost of operation reduces due to efficient use of delivery vehicles Table 2: Primary distribution and performance objectives Table 2 describes the tasks related with primary distribution in Tesco and the performance objectives met by these tasks. Performance objectives: Tasks in the primary distribution phase deals with sharing information with suppliers and collecting products from the depots (Cowles, 2012). The tasks mainly focus on increasing availability of products and reducing cost of operation. Tesco management uses a shared system so that their suppliers also can get sufficient information regarding the nature of customers. It enables the management of Tesco to make the supply of products uninterrupted. Tesco management implemented innovation in the process of collecting products from suppliers also. The products from suppliers are collected by vehicles when they return after delivering any product to customer. Efficient use of transportation infrastructure makes the primary distribution process of Tesco cost effective. Analysis on the tasks related with inbound logistics indicates that the quality of products is focused more while conducting the tasks related with inbound logistics. However speed of delivery, dependability and flexibility of products also depends on the tasks conducted at this phase. Operations: management of retail stores: The tasks related with retail store operations in deals with store layout planning utilization of available spaces, taking orders from customers and managing employees (Bouzaabia et al., 2013). Initially the organization used fresh and easy operating model. However the model was modified gradually and currently Tesco management uses group operating model. The management uses automated system for taking orders from customers; Apart from this floor planning activities of Tesco enable the organization to optimize the utilization of available spaces in a store. Store planning of Tesco management also ensures that the flow of process becomes less complex. It is also ensured that the employees are being provided with comfortable workplace. Task Quality Speed Dependability Flexibility Cost Floor Planning Reduces complexity of product handling and thus quality if product improves Complexity reduces inn process flow and thus the speed of delivery increases Effective display strategy increase visibility of products Product /service flexibility increases due to efficient floor designing Cost of operation reduces as flow if process becomes simpler Automated ordering Does not impact on quality directly Speed of delivery increases Availability of products increases Mix , Product/service, delivery flexibility improves Cost of operation reduces Labor scheduling Quality improves as handling products improves Speed is delivery increases as efficiency of staffs increase Does not impact on dependability directly Product/service flexibility improves with increasing efficiency of staffs Cost of operation reduces due to effective use of available staffs Table 3: Store management and performance objectives Performance objectives: Table 3 describes how the performance objectives are met in retail store management process of Tesco. Analysis on the store management related activities in Tesco indicates that the managers focus on increasing speed of delivery and flexibility while planning for these tasks. However successful execution of operational tasks also leads to improvement of quality and reduction in operational cost as the complexity in store management reduces. Outbound Logistics: Product Delivery to customer: Products in Tesco are delivered to customers in two ways. Customers can visit the stores and can by their products. Apart from thus Tesco management also provides the customers with opportunities for making online purchases. Tesco management uses delivery vans for sending the products to customers within time. Apart from this, Tesco charges a minimum amount for making home deliveries. Task Quality Speed Dependability Flexibility Cost Using Delivery vans Improves Increases Increases Increases Reduces Table 4: Outbound logistics and performance objectives Performance objectives: Table 4 describes how the performance objectives are met in retail store management process of Tesco. Analysis on the tasks related with outbound logistics related tasks in Tesco indicates that management of the organization focuses on increasing speed of delivery and reducing cost of while making strategies for these tasks. However use of advanced transportation infrastructure improves quality of products which are being delivered. As the management provides customers with opportunities for online shopping and home delivery of products, service flexibility increases significantly. Recommendations for Tesco: Although the continuous replenishment model of Tesco is effective for conducting the activities related with logistics management, the current model can be improved. In this assignment some recommendations are made for Tesco Plc for improving their logistic management system. Using alternative energy sources in store: The nature of customers is changing across the world .Apart from this the Governments of different countries are also developing stricter policies for reducing environmental pollution. A Tesco operates in international retail market; changes in Government policy in any country can affect its business growth. However Tesco management should focus on making environment friendly stores. Management of the organization should use alternative energy sources for avoiding the chances of interruption in business process due to strict environmental policies. However it will also enable the management to reduce cost of running stores. Outsourcing non-core activities: Currently the managers of Tesco are responsible for handling data regarding sticks and requirements of products. The organization should engage other companies with the database management process to improve efficiency. It will also lead to reduction in operational costs of stores. Conclusion: Analysis made in the current assignment indicates that the existing logistics management system of Tesco is capable for increasing business growth of the organization. However the system requires being improved as the nature of customers is changing worldwide. Some recommendations are made in this assignment so that Tesco Plc improving their logistic management system. Tesco management requires focusing on making environment friendly stores. The organization also can engage other companies with the database management process for improving efficiency. References Bouzaabia, R., Bouzaabia, O. and Capatina, A. (2013). Retail logistics service quality: a cross cultural survey on customer perceptions. International Journal of Retail Distribution Management, 41(8), pp.627-647. Cowles, J. (2012). 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