HARNESSING TECHNOLOGY FOR BUSINESS

DESCRIBE HOW ARGOS HAS CHOSEN TO ARRANGE ITS OPERATIONS, HIGHLIGHTING THE ROLE TECHNOLOGY PLAYS WITH IN IT.

Administration background and aims

The administration, ‘Argos ‘ was founded in 1973 and is portion of Home Retail Group ( Parent Company ) . It is a generalised shop, which sells a huge figure of family merchandises such as: family contraptions, playthings and games, DIY, athleticss and leisure, etc. Harmonizing to the Timess:

“ Approximately 98 % of the UK population live within 10 stat mis of an Argos shop.[ 1 ]

Argos has a formidable appreciation in most of the aforesaid markets. This constitution ‘s concern theoretical account is based on a simple enterprise: unite the comfort and the convenience of place choice ( catalogues, cyberspace, and phone ) with the closeness of its high street shops.

Since it foremost started out, Argos has ever been noticed for its advanced usage of engineering similar to the manner other administrations like Walmart, Amazon or Tesco use this type of engineering. Computer systems have ever had a immense impact on the manner Argos maps as a retail merchant. Argos uses ICT to supervise stock degrees, to recognize market developments earlier, to avoid stock deficit state of affairss and to extinguish merchandise larceny.

Tesco has a really similar concern structure/model. Argos is convenient because of its integrating with its practical online concern and its retail shops, merely like the manner Tesco operates ; utilizing its shops as its chief nucleus of operations. Argos besides publishes two catalogues a twelvemonth, the spring/summer edition at the start of January and the autumn/winter catalogue around mid-July.

Finance and Accounting

Argos is one of the UK ‘s major non-fare retail groups. In 1998, after hapless fiscal consequences, it was taken over by GUS ( Great Universal Stores ) plc. The so new appointed pull offing manager Terry Duddy so set out to better its public presentation. Part of Terry ‘s occupation was to alter the values and beliefs ( the civilization ) shared at Argos. As stated in the Times 100 instance survey:

“ The civilization he ( Terry ) developed is one that values: client service, teamwork, promoting directors to take their ain determinations, regard for each other and desiring to be competitory and better. ”

The Times so goes on to state that “ these values were clearly communicated to the employees ; so that they felt more a portion of the concern. ”

This clearly shows how Argos consulted with its staff to construct a sound squad, with squad values such as:

Welcoming alteration

Bing impatient to win

Having tonss of chances

Working in squads

Argos has built these values into its civilization. To back up this alteration, they besides provided good introductory preparation, promotional chances and public presentation ends. Equally good as altering the civilization at Argos, directors changed the selling merger. This consisted of the traditional ‘Four P ‘s ‘ along with other issues which Argos thought of import.

Merchandise. Market surveies showed that the Argos trade name was seen as dull and antique. Argos so modernised the trade name with a new logo and new motto: ‘Brighter Shoping ‘ . It besides extended its merchandise scope.

Promotion. Argos advertises to divide market sectors. It divides its market by traditional ways but besides uses ‘brand consciousness ‘ . As quoted from the Timess:

“ The ‘get it ‘ group – who know and understand the trade name – are used to assist convey on board the ‘do n’t acquire it ‘ group. ”

Monetary value. Argos continually keeps its monetary values every bit low as possible.

Topographic point ( distribution ) . Argos continues to spread out its retail market by opening new stores. Its catalogue is a cardinal portion of its distribution system and is “ found in 70 % of British places.[ 2 ]

Peoples – Argos provides good preparation for its staff as portion of its civilization alteration.

Process – Alongside traditional shopping methods, Argos introduced ‘Quick Pay ‘ and ‘Text and Take Home ‘ . ( Customers ‘ text to see if an point is in stock, and so reserve it to roll up subsequently ) ‘Quick Pay ‘ cuts down on waiting lines by leting clients to look into handiness, order and pay utilizing recognition or debit cards.

Physical environment. Argos invested in betterments to do stores more appealing to consumers.

As a consequence of these implemented alterations to Argos ‘s civilization and the employment of engineering. Argos now out-performs the market as a whole:

“ Between the periods ( 2002-2003 ) gross revenues grew by 13 % and net incomes by 17 % .[ 3 ]

Gross saless & A ; Selling

For advertisement, it ( Argos ) uses a assortment of different media to advance its retail market, such as: telecasting, wireless, newspapers, catalogues, magazines, postings and the cyberspace. Depending on which is the most good and efficient at the clip. This method of using engineering is really effectual associating to pulling new and old clients viz. by suggesting:

Value for money

Convenience.

Selling directors at Argos are continually concerned with turn toing inquiries such as:

Who are our consumers? ( Argos wants to detect every bit much information as possible on its clients in order to run into their demands. )

Are we suggesting adequate assortment of merchandises, entreaty and convenience?

How can we derive advantages over competition? ( How is Argos different from the resistance? )

How can we support what trade we already have and how can we spread out?

How do we successfully interact with our clients?

Harmonizing to the web site, ‘computerworlduk ‘ , this twelvemonth Argos ‘s cyberspace “ website accounted for 32 % of the administrations entire gross revenues, 22 % of which used the on-line chink and modesty service ” . This shows how much of a positive impact the engineering of the cyberspace has had on this retail giant. However, compared to last twelvemonth ‘s same interim gross revenues reappraisal this twelvemonth was 11 % down, but despite the 11 % autumn in net incomes, on-line gross revenues had important growing.

Argos gross revenues ( ?M ) : 2006 = 3,859, 2007 = 4,164, 2008 = 4,321, 2009 = 4,282, 2010 = 4,347Description: % Gross saless across more than one channel: Sums: 2006: 32 2007: 35 2008: 37 2009: 40 2010: 43 2010: Home bringing Store – 7.7 Phone – 1.6 Internet – 9.5 Check & A ; Reserve Phone – 9.5 Internet – 22.5

Gross saless ( ?M ) ( Picture on left )

Definition: Gross saless in the 52 hebdomads to 27 February 2010 increased by 1.5 % in entire. There was further strong growing in telecastings and personal computing machines, countervailing failing in the picture bet oning market. Toy gross revenues grew strongly. Challenging market conditions continued in home-related countries such as furniture, but the rate of diminution moderated over the twelvemonth. Beginning: audited fiscal statements.

Gross saless across more than one channel ( % ) ( Picture on right )

Multi-channel gross revenues grew to ?1.9bn or 43 % of Argos ‘ gross revenues. The cyberspace represented 32 % of Argos ‘s gross revenues ; over two-thirds of this or 22 % of Argos ‘ entire gross revenues were clients utilizing on-line Check & A ; Reserve for shop aggregation, with this channel turning by 36 % for a 2nd twelvemonth in a row. Definition: Percentage of gross revenues across more than one channel. There are three telling channels: the cyberspace, phone or shop and two fulfilment channels, shop or place bringing. Beginning: Measured internally.

Argos has a battalion of alone selling and gross revenues schemes in retail. Argos ‘s declared mission statement is:

“ We provide our clients with the best value for money through the most convenient shopping experience ” .

This statement clearly sets out the chief countries which differentiate Argos from its challengers, viz. by offering its clients. As stated in 2002 by pull offing manager of Argos, Kate Swann. Customers can:

Pick up a catalogue

Choose at place ( cyberspace )

Use a shop to roll up or order

Use a shop for aggregation point

Order at place ( telephone )

Use place bringing

She besides specified that Argos ‘s drivers for growing were:

Small kitchen contraptions ( which it was in top place in 2001 for both value and volume )

Beds and mattresses

Watchs

Jewelry

Portable sound

Playthings

Retail Structure

Tesco was the first to utilize such a construction ; by uniting its online web site ( s ) with its supermarkets. Argos most probably adopted this similar scheme based on Tesco ‘s overpowering success.

However, Argos retail shops have minimum staff ( unlike Tesco ) , and exploit engineering to its full potency ( like Tesco and Amazon ) . On an independent instance survey by Databank Consulting, they stated that:

“ Argos ‘s concern theoretical account is a multi-channel attack: clients are offered different types of mercantile establishments for shopping. Prior to the debut of the new e-channels, the clients could merely shop the offer in the catalogue or straight at the shop[ 4 ]

They besides suggested that Argos ‘s success as a retail merchant has been based on its influential determination to follow a technological based attack, by saying:

“ The Argos web site was launched in 1995aˆ¦Nearly 10 old ages subsequently, Argos can be called a innovator and leader in e-commerce. With www.Argos.co.uk, the company became UK ‘s figure two “ Chinks and Bricks ” retail merchant, uniting both shop based and on-line gross revenues.[ 5 ]

Before its determination to present a system called ‘Nominated Carrier Scheme ‘ , the job of receiving and delivering merchandises was debatable and complicated, because every provider has its ain signifier of transit, its specific method of documenting and specific clip agendas. The determination was hence to follow a individual system to convey together all the green goods from providers and have them offered as merely one bringing. This stock concatenation solution by UPS receives, validates and grips cargos from several hundred Argos providers. UPS so checks that the order is accurate, merges it with other orders and so sends it to Argos ‘s ain warehouses for the concluding bringing.

Possible Improvements

Argos could implement an improved stock ordination and restocking system. Argos stated that it would “ go on to turn over out a ‘voice put away ‘ procedure across all shops over the following two old ages ” . They so went on to state:

“ This engineering ( ‘voice set away ‘ ) helps to automatically steer stock room helpers to the correct location[ 6 ]

The cardinal benefits of this engineering would be ; quicker processing and enhanced stock truth, thereby bettering handiness of stock and the degree of client satisfaction.

Another possible betterment could be directed towards their gambling sector ; as this is one of the countries they do non execute good in. They could make this by following a similar scheme to bet oning shops like ; ‘Gamestation ‘ or ‘Granger games ‘ . Which will include a trade in system for games and the value of the trade in ( s ) would be deducted from their chosen purchase from the Argos shops. Argos could so travel on to sell the traded in games.

The cardinal benefits of this adopted scheme would be ; increased gross revenues at Argos as many people who buy games would be more inclined to shop at that place, increased gross and a larger portion of the bet oning market.

Decision

Overall, this administration efficaciously utilizes engineering for growing, stableness and convenience for both Argos and its clients. Argos has gained competitory advantage over rivals by separating itself on the “ footing of supplying the best value for money for clients through the most convenient shopping experience[ 7 ]“ . Tesco was one of the first administration giants to incorporate its already bing concatenation of supermarkets with a practical online one, Argos uses the similar scheme but with a difference ; convenience of reserving merchandises on-line and roll uping at the clients nearest retail shop ( there Click and Reserve service ) . The laterality and success of Argos ( and other administrations like Tesco and Amazon ) are a consequence of each of them using “ their ain alone shopping experience[ 8 ]“ . Argos is popular and successful because it is focused around run intoing the client ‘s demands. By integrating new engineerings, Argos continues to supply the methods that are most appropriate to the contemporary retailing experience.