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 large chains. Over time, both of these types of retailers were overcome by the large big box chains such as Borders and Barnes and Nobles with thousands of stores across the USA. Finally, the big box chains “bricks” faced competition from Internet bookstores “clicks” such as Amazon.com.
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. Compare and contrast the operations infrastructures needed to support a “brick” (traditional thousands store chain such as Barnes and Nobles excluding the internet component) and a “click” (internet only) on the following operations dimensions: Order winners, types of inventory, and supply chain design.
2. What determines the capacity for both “bricks” and “clicks”? What are the scheduling issues you would anticipate for each type of business? How would you measure capacity and scheduling effectiveness for each type of store?