27 May 2005

Own Branding (Part III)

Advantages of Own Branding for Suppliers:

Excess production capacity can be utilised
Own brands help absorb fixed costs
The retailer has an equal interest in selling the goods
Some warranty liabilities may transfer to the retailers

Disadvantages of Own Branding for Suppliers:

Advantages may be short-lived
Own brands may reduce sales of manufacturer's brands in the same store
Retailers may restrict display and promotion of manufacturer brands to emphasise own brands
Bargaining power is lost as the retailer can usually switch to alternative channels of supply

If anyone would like further examples of the advantages and disadvantages of supplying own brands for retailers, please let me know either via comments or email, and i would do my best to post them as soon as possible.

Own Branding (Part II)

Advantages of Own Brands for Retailer's:

* Image Building / Brand Loyalty

Good value enhances store image
Build relationship of trust and credibility
Control over relationship with customer
Good value builds loyalty to the store and own brand

* Competitive Edge / Extra Turnover

Advantage over competitors with no brand
Offer benefits distinct from competitors
More control of product specification and quality
Allows more retailer-led product innovation

* Higher Profits / Better Margins

Margins tend to be 5-20 percent better
Manufacturers' promotional expenses are avoided
Display space can be manipulated for better returns
Sales can be promoted by placing own brands next to major brands

If anyone would like further examples of the advantages for retailer's having own brands, please let me know either via comments or email, and i would do my best to post them as soon as possible.

Own Branding (Part I)

Drivers of Growth:
  • Product Category Characteristics
It is easy to make from commodity ingredients
The product is an inexpensive, low-risk purchase
  • New Product Activity
Manufacturer brands are offered in few varieties, so the retail brand offers clear alternatives
Consumers can easily make side-by-side comparisons of manufacturer and retailer brands
  • Retailer Brand Characteristics
Distribution is well managed
Consumers have confidence in their ability to make comparisons about quality
  • Price and Promotion Factors
Price gaps between national brands and private labels are wide
Retail margins in the category are relatively high
  • Retailer Characteristics
The retailer has the size and resources to invest in high quality, own brand development

If anyone would like further examples of the drivers of retail brand growth, please let me know either via comments or email, and i would do my best to post them as soon as possible.

Franchising (Part IV)

Potential Disadvantages for the Franchisor:

Less control over day-to-day operations
Reputation may be damaged by some franchisees
Franchisee motivation may wane over time
Some Franchisees take short-term view
A franchisee may become too powerful
Restricts use of other channels if exclusive geographical area agreed

Potential Disadvantages for the Franchisee:

Turnover and income may not meet expectations
May start to resent restrictions
Less scope for initiative and localisation
Cheaper supplies may be available from other sources
Still paying fees for marketing, even when a loyal customer base is established
As turnover increases, so typically does the fee

Franchising (Part III)

Advantages for Franchisor:

Rapid Growth is possible
Less capital required
Franchisees make highly motivated owner-managers
Lower monitoring costs
Chain can include some directly managed outlets
Scope for internationalisation
Low-risk way to test/develop a market

Advantages for the Franchisee:

Retains some independence
Rewards proportional to success achieved
Less start-up risk
Loans more readily available
Support and advice in setting up and operating
Use of well-known brand name
National/international marketing activity

Franchising (Part II)

Symbol Groups

A response by wholesalers and independent retailers to the growth of the multiples (e.g. Wal-Mart) has led to the formation of 'symbol', 'voluntary' or 'affiliation' groups. Within this form of contractual chain, a group name is utilised and:
  • The retailers normally are required to obtain a specified proportion of their goods from the group wholesalers.
  • The basis of of the contract is that the retailer sacrifices some freedom of action for the sake of big retailer disciplines that the sponsoring wholesaler seeks to provide.
  • Member retailers normally pay a levy towards the costs of the services that the group provides.
However a number of advantages are also obtained by the retailer in return:
  • Loans and financial support to develop or to extend/refurbish units.
  • Group buying power normally leads to better prices than an independent could obtain.
  • Benefits are gained through own-brand products and the group image.
  • Turnover is increased through lower prices, group marketing expertise, promotions, etc.
  • Selling costs as a percentage of turnover are therefore reduced.
  • Labour productivity is improved through higher turnover and better administrative systems.
  • Space productivity improves through advice on space allocations, merchandising and display.
  • Profitability and return on capital is improved.

Franchising (Part I)

The term ''franchising' has been used to describe various types of trading arrangements and opinions differ as to what truely comprises a franchise.

'Stern & Stanworth' (1988) took a broad view of the concept and identified 4 main contexts:
  • Manufacturer - Dealer: Within this agreement, the manufacturer is the franchisor and the franchisee sells direct to the public. Many such franchises are found in the retailing of cars and petrol.
  • Manufacturer - Wholesaler: The most notable examples are Coca-Cola and Pepsi-Co, who franchise the independent bottlers/canners who, in turn, sell to retail outlets.
  • Wholesaler - Retailer: Known as 'Symbol Groups' (would be discussed in part ii)
  • Business Format: The franchisor grants permission for the franchisee to sell the former's products or services. the franchisor also provides a proven method of trading, plus support and advice in setting up and operating the business.

Advantages of being a 'Multiple'

What is a 'multiple'?

Multiples are described as a retailer with atleast two, five or ten outlets.

The Growth Cycle

The growth of multiple's create improved buying power in terms of supply of goods, recruiting staff, acquisitions and also in services it buys from outside suppliers, such as advertising agencies, accounting (back-office services), etc.
Leading to:

Economies of scale are achieved through the ability to develop products, brand image, improving supply chains, which can be rolled out over a larger number of locations.
Leading To:

Margin Gains.
Leading To:

This enables a retailer to offer competitive prices through discounts, special offers and improvements in its product/service mix through increased product/service quality, offering choices and convenience.

Leading To:

Future Growth of a multiple-retailer.

26 May 2005

The Marketing Plan

Each business, product or brand needs a detailed marketing plan. What does a marketing plan look like? A product or brand plan should contain the following sections:

Executive Summary - the marketing plan should open with a short summary of the main goals and recommendations in the plan. The executive summary helps top management to find the plan's central points quickly. A table of contents should follow the executive summary.

Marketing Audit - is a systematic and periodic examination of a company's environment, objectives, strategies and activities to determine problem areas and opportunities.

SWOT Analysis - draws from the market audit. It is a brief list of critical success factors in the market, and rate strengths and weaknesses against competition. It should include costs and other non-marketing variables. The outstanding opportunities and threats should be given.

Objectives and Issues - after analysing the SWOT, the company sets objectives and considers issues that will affect them. The objectives are goals that the company would like to attain during the plan's term.

Marketing Strategy - In this section the manager outlines the broad marketing strategy of 'game plan' for attaining the objectives. It should detail the market segments on which the company will focus.

Marketing Mix - contains the 4P's: Product, Promotion, Price and Place. A manager should outline how each strategy responds to threats, opportunities and critical issues described earlier in the plan.

Action Programmes - answers the following questions: What will be done? When will it be done? Who is responsible for doing it? How much will it cost? The programme should outline special offers and their dates and other promotions.

Budgets - are the basis for materials buying, production scheduling, personnel planning and marketing operations. Budgeting can be very difficult and various budgeting methods can be applied i.e. 'rules of thumb'.

Controls - will monitor the progress. typically, these are the goals and budgets for each month or quarter. This allows higher management to review the results of each period and to spot businesses or products that are not meeting their goals. This leads to corrective actions taking place.

Implementation - is the process that turns marketing strategies and plans into marketing actions to accomplish strategic marketing objectives. Planning good strategies in only a start towards successful marketing. Without successful implementation, a brilliant strategy is worth nothing.

Forms of Economic Integration

There are five types of regional economic integration between countries, they include:
  • Free Trade Area (FTA)
A free trade area eliminates all barriers (both tariff and non-tariff) to trade between member countries but allows each country to establish its own trade policies against non members.
Examples include:
• The North American Free Trade Area (NAFTA) and
• The Association of Southeast Asian Nations (ASEAN)
  • Customs Union
A customs union combines the elimination of barriers (both tariff and non-tariff) to internal trade between member countries with the adoption of common external trade policies toward non members.
An example of a customs union is the one which exists between Switzerland and Liechtenstein.
  • Common Market
A common market combines the elements of a customs union with a policy that allows for the mobility of factors of production. Productivity is expected to rise in a common market because factors of production are free to locate where the returns to them are highest.
The European Union is an example of a common market till the late 1990s.
  • Economic Union
An economic union eliminates trade barriers between member countries, establishes a common external trade policy, follows a policy of factor mobility and a total harmonisation of monetary and fiscal policies which includes using a single currency.
The European Union is currently moving toward economic union status as only 12 out of 25 countries have adopted the Euro.
  • Political Union
A political union combines the elements of an economic union with the added feature of complete political integration.
The United States, transformed from 13 separate colonies into one, is an example of a political union.

25 May 2005

Learning Online: Trump University's Way

Donald Trump - He's built buildings, written books, married models and starred in a reality TV show. Yesterday, Donald Trump announced his latest venture: Trump University.

The for-profit online university will not offer degrees or grades. Courses will cost $300 and will take one to two weeks to complete. It will consist of online courses, CD-ROMS, consulting services and Learning Annex-type seminars.

"In today's hyper-competitive business climate, the need for the highest quality education has become more crucial than ever," Trump said. "But people are looking beyond the traditional business education model, which involves hours in the classroom and relies primarily on book learning."

Students (or customers, as Trump University staffers refer to them) will be able to register for classes in marketing, real estate and entrepreneurship, with additional curriculum areas planned for the future.

Read more here.

Overcoming the Biggest Barrier to Student Success

In the article, "Overcoming the Biggest Barrier to Student Success", the author Ron Bleed (vice chancellor IT, Maricopa Community Colleges) views various obstacles faced by students and explains different approaches that can be taken to overcome the problems.

Read more here.

24 May 2005

Blogs in Higher Education: Personal Voice as Part of Learning

The use of Internet technology to facilitate interaction, communication, and collaboration is well documented but its use in establishing and developing "personal voice" as part of learning is also now being addressed through the use of blogs. Finding personal voice as a pedagogical method is important to establish learner identity and focus, and journaling has long been recognized as an effective way to provide space for this to occur. The blog, however, provides a context in which personal voice can be "published" by the student, which means that attention is given to content, relevancy, and connection with learning outcomes to a higher degree than a traditional journal submission. The idea that more than one person will view the work is quite powerful in promoting a sense of ownership from the student. Teachers can also benefit from "hearing" the personal voice of their students to begin to really understand the learning path of each student through a course. The above is the opening paragraph in an article, Blogs in Higher Ed: Personal Voice as Part of Learning, published by Ruth Reynard in eLearning Dialogue. Here is the summary and recommendations from the article:

* Blogging must be integrated early in the course design and must be clearly connected to the course outcomes before it can become anything more than just an extra task for the students.

* Grading does seem to motivate the students, but it seems to be more effective to grade according to effort in relevancy to course content and outcomes than simply on numbers of submissions.

* There is an issue with privacy, particularly with older students. This should be addressed by emphasizing how to secure and share entries.

* Instructors need time to evaluate the importance of self-reflection as a methodological approach in learning as well as the value of integrating personal voice in the learning context. Otherwise the exercise will be perceived as futile to the students.

Read more here.

Case Study Write ups: Some Practicle Tips

1. Do not repeat Case Facts. The class or person marking will have read it too. You therefore do not need to repeat case facts. Such repetitious padding will add nothing either to the development of your argument for making a particular recommendation or to your mark.

2. Always assume you have sufficient information. It is not satisfactory to ‘cop out’ by stating that you do not have sufficient information. Managers the world over operate in situations where the information supply to make decisions is imperfect.

3. Waffle Factor. It helps to imagine that you are a consultant or a senior manager being asked for advice when working on a case study. If when you review your advice it seems a load of waffle, try again. Your advice would be of no practical use and is therefore not acceptable as an exercise in applying concepts.

4. Challenge or Acceptance? Generally speaking case studies are written to illustrate a problem or issue. If you find yourself endorsing or accepting the organisation’s thoughts or actions without discussion, think again! The case was written to generate debate. Is all as it appears? Become sceptical; do not necessarily accept bland statements without corroborating evidence. Challenge the views and perceptions of the people as represented in the case studies.

5. Thoroughness. Do not ignore data, financial or otherwise, that is included. It probably has a purpose; even if it’s an exercise in determining whether you can see the wood for the trees.

6. Credibility. Never forget implementation issues when making recommendations. Not all opportunities are exploitable. Employed human beings are not an infinitely disposable commodity. Your ability to determine the best match of decision in strategy, marketing etc. for the organisation’s capabilities, resources and the external environment is paramount and a major step on the way to becoming an effective manager.

The Case Study Process (Part IV)

Written work

Case Studies can be presented in essay or report form with headings as appropriate. The former is more demanding in the earlier stages of case study learning as it forces you to articulate the concepts in your own language.

For substantial case studies detailed analysis should be located in appendices and referred to in the text. References and Bibliographies can also usefully be included at the end.

What is the person marking the work looking for?

This person will be looking for clear understanding of the case and related issues leading to an orderly and logical presentation of facts, analysis and evaluation, with clearly argued or discussed reasons for your decisions with back up information. The essay or report should be laid out clearly on the page in a concise manner with cogent use of white space. Presentation of written work to get your message across most effectively is an important skill to acquire.

Where the report is the result of group effort, please make sure that the same style is maintained throughout.

Mini One Page Case Write Ups. Such case study write ups do not involve the full write-up facts and situation analysis and subsequent evaluation. They are a Summary of a full write up, sometimes known as an executive summary. They aim to use your mind rather than exercising IT or writing skills in asking you to refine and distil the case study down to the most important and salient issues and make a decision giving your reasons. They show very clearly whether you have grasped the essentials with a minimum of fuss.

Verbal Presentations

These should aim to be interesting and include anecdotal evidence that might not be found in the main report if there is one. Such presentations should follow a different format to the report / lecture to avoid boring the audience and marker. It should add to the report rather than detract with the use of good graphics and clear presentation materials. Only one or two people should present. Presentations where numerous people are leaping up and down are distracting and invariably lose something in terms of message continuity. How you allocate the tasks between you fairly and effectively are important group working skills.

The Case Study Process ( Part III)


Problem or Issue Identification

The first step after coming to grips with the internal and external realities (which will take anything from 5 minutes to a much longer period depending on your developing skills), is to identify the key issues or problems within the organisation being studied. What is cause and effect? What have you been asked to do relative to the case study? What aspects are symptoms rather than a problem?


Which are the most fundamental problems? It is important not to chase insignificant issues or problems at the expense of the key ones. It is essential, especially for Strategy considerations, to keep sight of the broader view. Everything is connected to everything else. It is here that use of specialised functional techniques might begin and is generally a seamless activity with generating potential options. Ratio analysis might give you the relative financial performance against similar companies or the management’s control of resources.

Marketing concepts, say of segmentation, targeting and positioning will help identify potential customer groups. Use whatever tools of analysis are to hand for the subject area. Generally speaking a case study is introduced at a particular point in time to illustrate the concepts and theories you have just covered. You therefore should not struggle to find the tools you are looking for. Presuming, of course, that you have attended the class and done some work!


The application of concepts and techniques will have given rise to a range of potential options, which the organisation might pursue. List your alternative options and then evaluate each one. What are the benefits and risks associated with each option? Advantages & disadvantages? Make notes of your reasoning and any assumptions you might make in the process.


From the options listed you will need to decide which to recommend or choose. Your reasons should be clearly stated referring to analysis carried out and your recommendation put clearly and unambiguously. Always bear in mind that operational implementation issues are just as germane as strategic ones when it comes to making a decision. If in coming to a decision you make some assumptions make sure these are stated.


This can be done in writing or verbally, individually, by a group or through class discussion on the instruction you have given. Sometimes you will verbally present and submit a report. Other times you will do work individually and then discuss in class.

23 May 2005

The Case Study Process (Part II)


A case study is best read at least twice. The first time quickly (on the bus, in the loo or bath whatever takes your fancy) to get an overview. The second pass, later in time, will reveal details that you did not first register and allow easier understanding, application of concepts followed by a more perceptive analysis and evaluation.


Organisations consist of both responses to internal and external factors and conditions which are either controllable to a degree or not at all. In order to begin to think about any future course of action for an organisation, it’s internal and external realities need to be explored using the techniques presented to you in lectures / tutorials/ reading.

EXTERNAL - Macro (STEP or PEST) and Micro factors are one framework for carrying out an analysis for the uncontrollable elements in the organisation’s environment.

A. Macro Factors: - [Socio-Cultural]
- Market specific Economic/Environmental
- Political
- Technological (Legal / Regulatory)

B. Micro Factors: - [Competitors]
- Organisation specific Customers
- Suppliers
- Interest Groups (Unions, Trade Organisations, Stake-holders – eg ocal authority generally etc
- Distributors / Intermediaries
- Markets / Segments

The list is an outline it is potentially infinite

INTERNAL - The internal realities of an organisation influence their possible courses of action so these must be carefully considered in some form of resource audit. Financial, marketing, human and physical resource audits are common occurrences during an organisation’s existence. You must learn how these are carried out. In Accounting there are prescribed rules to be followed but other types of audit using a variety of tools and techniques vary in format and nature according to who is carrying them out.

An organisation analysis will take into account its financial status and performance, its organisation structure and its appropriateness to the task, the ability of the organisation’s human resources to carry out current and future tasks as well as the physical (and financial) resources needed to do so. This may mean looking carefully at the capacity of a warehouse to handle increased sales for an Operations Management case study or the organisation of the marketing function in a manufacturing company going into a service business for a marketing one.

Matching future plans and strategies with the organisation’s capabilities and resources for the ‘best fit’ with the Mission Statement and objectives must include implementation issues, either on a broad strategic level or at a more minor level such as a minor operations strategy issue.

22 May 2005

The Case Study Process (Part I)

The case study should be read thoroughly a couple of times at least before beginning work, preferably over a period of days. Sometimes particularly early on in case study work you will be given a question(s) to address. At later stages or at MBA level you may receive no guidance and be left to cope with a mountain of information to wade through to determine the key issues.

Broadly speaking there are five main stages to tackling a case study that must be undertaken by the group or individual. These are:-

- Understanding the situation: both internal to the organisation and externally

- Determining and Applying the appropriate concepts: to the case study facts as presented as well as information you may already have or gleaned elsewhere ( Newspaper Industry Reports, Keynote and Mintel Reports, Internet )

- Analysis of the Facts and Identification of the Key Issues and Problems

- Generation and Evaluation of Potential Options for courses of action to address these problems or issues

- Making a Recommendation or Decision on the most appropriate option with reasons.

- Presenting a Verbal or Written Report

Your intellectual development will be marked by your ability to think your way through these stages in a logical, structured and objective way in applying whatever concepts or theories you have been presented with. Repeated attempts at doing this become an iterative process that will consolidate your understanding and complete the learning process.

A Case Study Guide

Why Case Studies?

Case Studies are a very useful learning tool in many different organisational management areas. They are used frequently because: -

1. They provide real life information about many types of organisations with different cultures, philosophies, structures and management methods. These organisations form industries or sectors with distinctive characteristics in patterns of ownership, structure, behaviour and ways of reacting to the external environment.

It is important for students to grasp early on the diversity, similarity and relationships between organisations that inhabit the world we live in. These form an interesting and fascinating web that governs much that we do. Case Studies add to your knowledge base bit by bit.

2. Case studies present the student with the best simulation of a management situation. What would you do if you were in that manager’s or C.E.O.’s shoes given the available facts? Case studies help you acquire important management skills of analysis, evaluation and decision making, exercising these skills verbally in groups as well as in writing.

3. Perhaps most importantly, however, case studies allow you to apply concepts introduced in class or during reading to ‘real’ situations. It is sometimes easier to grasp a concept in a context rather than in isolation; the theory seen in practice. It is certainly easier to begin to articulate and understand the strategic management processes (a string of concepts) within a context.

Case studies are to be found in all the management disciplines; Marketing, Accounting, Organisational Behaviour as well as general Business Policy / Strategic Management area where all aspects of the organisation can be up for scrutiny. Some cases focus only on a limited issue in one functional area. Other more sophisticated case studies, many pages in length, start to require analysis across all the management functions and the generation of integrated strategic solution appropriate to the whole organisation.