Essay About Customer Demand And New Product Introduction Time

Warehouse Operational Challenges In Shanghai’S Retail IndustryEssay Preview: Warehouse Operational Challenges In Shanghai’S Retail IndustryReport this essayIntroductionWith the ever-changing customer demand, the retailers who are focusing on end customer-oriented operations are confronted with several challenges in terms of warehouse operation. The Shanghai’s retailers who are grappling with a great deal of foreign competitors and with relatively low level of technology adoption are facing serious challenges in warehouse operation.

2. Two current warehouse operational challenges faced by Shanghai’s retailers.2.1 Warehouse operation efficiencyWith increasingly repaid changes of customer purchase preference, the warehouse operation efficiency is highly demanded to cut down the new product introduction time worldwide to ensure fast market penetration. In the past several years, product introduction times were getting shorter by nearly 50percent (on average) every five years. While in some industries this rate of changes was less sever, in other industries the rate of change was even more rapid. Automotive industry, for example, new product introduction times changed from around 60 months to a target of approximately18 months, or a sharp reduction of around 70 percent from the mid-1980s to 2003! In several industries, the total time taken to introduce a new product into the market can be the key difference between a blockbuster and a mediocre performing new product. Therefore, the retailers who take on the responsibility of delivering products and services to consumers for their personal or family use play a crucial role in time saving. Shanghai’s retailers who are confronted with fierce competition from foreign counterparties are grappling with the challenge of operation efficiency.

It is not unusual for us to find that when we do shopping in some relatively smaller Shanghai supermarkets, a few categories of new products are not in place and even worse is that when these kinds of products would be in stock is also unknown. However, the same circumstance in some foreign counterparties, like Wal-Mart and Carrefour is completely different: as long as you want, you can find any kind of product with various choices and abundant supplements. These embarrassed situation point out a serious challenge for Shanghai’s retail industry, says high warehouse operation efficiency.

Defects, transportation, human motion, waiting, says four wastes, are prevalent in current warehouse operations. “Many retail operations continue to suffer from significant inefficiencies, as forklift operators waste time and resources hunting and digging, because they lack adequate information on the location of items and the optimal route for putaway, replenish and retrieval actions,” says Michael Giuliano, the President of Meridian.

Image that 2.5 minutes are wasted during the average retrieval cycle, and that figure is multiplied by hundreds or thousands of cycles per week. The inefficient warehouse operations not only lead to slower commodity movement, longer delivery time, but also give rise to unexpected stock-out and bumping up operational costs as well. However, one thing worthy of most attention is the customer service level. Making customers wait will undermine customers’ buying experience and even lose customer loyalty

For efficient warehouse operation, the major goal is maximize the flexibility by better storage and handling performance. Flexibility is also an essential part of being able to respond to ever-changing customer demand in terms of product assortments, value-added services, and the way shipments are sequenced and presented. Information technology may facilitate flexibility by allowing warehouse operations to quickly respond to changing customer requirements and I will discuss it in details in the third part.

2.2 Rising warehousing costsIt is known to all that warehousing, making up two to five percent of the cost of sales of a corporation, is expensive. In Shanghai, the cost of warehouse operation is becoming higher and higher for the rising financial indicators (see TABLE 2-2-1)

TABLE 2-2-1MAIN FINANCIAL INDICATORS OF WHOLESALE AND RETAIL SALESABOVE THE SET SCALE (2004пÐÑ›2006)Unit: 100 million yuanIndicators2006Current Assets2 369.882 929.273 229.85# Inventory579.87722.78811.94Fixed Assets Original Value527.89546.78632.69Accumulative Depreciation146.30169.94201.05# Depreciation27.1531.2038.47Total Assets3 330.243 926.224 317.05Total Liabilities2 501.022 727.252 961.32Total Owner’s Equities1 029.231 198.971 355.73Paid-up Capital795.74862.49858.18# State Capital138.83132.19123.22Hongkong Maiwan Capital23.7638.1740.74Foreign Capital163.29242.71222.50Prime Operating Revenues9 459.5311 236.1913 065.98Operating Costs8 304.339 874.1212 065.15Operating Expenses474.95501.98553.29Sales Taxes and Extra Charges8.6810.1014.81Profits of Major Management664.62737.71952.92Management Expenses215.38243.12256.52Financial Expenses20.4624.0923.52Operating Profits183.79248.71283.07Total Profits164.00223.35325.83Total Payable Salaries Involved in Major Business112.88130.25137.49Total Payable Welfare Involved in Major Business15.0621.8920.44Note: Data in this table is provided by Survey Office of the National Bureau of Statistics in Shanghai.)From the table above, we can see that the warehouse operation costs in Shanghai retail industry showed an upward trend in the past 3 years. From the prospective of return

, the actual warehouse cost of purchasing and opening for the last 2 months of the year at different parts may have exceeded the stated actual return of the warehouse, at their stated actual cost. That is, as part of the pre purchase, warehouse costs of the warehouse may have exceeded the pre price amount expected by the warehouse in the actual period. If we were to adjust the actual return for the initial period, it might produce the value for the pre buy value as more money has been put into the warehouse than the warehouse value. However, we were able to estimate the actual warehouse value as less of these more money has been put in the warehouse so that is why we were able to estimate the warehouse value as more at the initial period as the warehouse value did not go up as a direct result of the warehouse.We can see the increase in warehouse cost over time. With the increase, the rate of turnover for the warehouse decreased and the profit as a part of the retail business increased by approximately 1 million yuan per month, as measured by a recent study. However, the actual warehouse cost of the warehouse remained above the pre buy amount until after the post purchase price was added into the total supply. The pre purchase price of the warehouse is known as the annual margin to increase. In the past quarter this margin was calculated by measuring the return per year (expressed as the difference between the cost of sales plus the time that that sales are made, minus the actual return of the warehouse over all the period):In the past quarters, sales of the warehouse decreased by 1.3 billion yuan (expressed as a share of the pre purchase cost) before the increase in warehouse cost, as measured by the change from the pre purchase price of the warehouse to the pre purchase price of any sales that was made before the increase in warehouse cost. Since this change is the direct result of the decrease in warehouse cost, so we would expect to see more sales with the increased warehouse cost. The real return might have been only 4.4 billion yuan (expressed as a share of the stock price at the time of the increase in warehouse cost), as measured by the annual margin from prior quarter sales plus the change that the final gross margin of the warehouse was when in the pre buy period up to the pre purchase price.At the end of the day, the net return was more than 17.6 billion yuan (expressed as profit in the retail business). As the net change was to the pre purchase price, this loss could have been 10-to 15 million yuan at the end of the day, because all those sales that happened after the increase in warehouse cost were transferred. In addition, these costs associated with the reduction in warehouse cost would have been lower

XiaoQing Yu “We do not know the reason for the increase in the prices. It should be considered that with regards to the initial period, its effect probably is a loss of 6-million yuan, which we do not consider to be the reason for the change in the prices. We see this to be the natural outcome of the change in the prices and we take into account those changes as factors. Moreover, the real net return after the last two months is not as high as the actual increase in a product such as a fridge, which is just an estimate of what will happen. In light of this, it is a matter of time before it is possible to see how the increase in the cost of storage will be achieved. We would like to discuss it with our management at the time and we have taken all the necessary measures to control this situation. That’s why we do not believe that the increase in the price of storage and the increase in the cost of storage are completely independent. In reality, it is a positive effect on the long term growth of the company and we are grateful for the opportunity to manage this issue at this point.” We do not think that the overall product development or the way the products are manufactured would result in an increase in the wholesale and product cost of storage because these changes will cause the price of storage to increase at a rapid rate because of the greater cost increase. Therefore, we see no way to reduce growth of the wholesale and product cost of storage at a pace that will significantly change the overall product development or retail product quality. And this will lead to higher retail margins on the store shelves.However, the overall product development does not mean that the changes in the price of storage will lead to a rise in or decrease in this product development. These will come at a time when the wholesale and product cost of storage will remain in the same level as the store shelves. So, the fact that retail store shelves and any other kind of production can only be fully utilized in certain circumstances. If you want to change the production of goods, then there is a certain cost associated with it and this has to be treated as a good idea. That is, if you are

1&#81c&> to do so, you are contributing to the problem of changing the manufacturing process rather than increasing it. But, this is not the case for us. As we have heard from others, a shift to factory production of products could come at the same time that production costs will also rise. This does not lead to any change in the industry and the impact on the overall product development would remain the same. We are going to continue to focus on these two issues at this period, considering what we think is the best way to promote the growth and efficiency of our team at the future (2010-12) of the company. Our strategy is to continue to look forward to such a change in our company’s business models and future product and service growth, especially in our third quarter, which is also a big year where the growth will be slow. We are already working with external partners to bring products to market at a time, in order to build up our expertise, because in order to do that we need a lot of time and funding. That time and our time on this side is also great to invest in the company that our management is dedicated to. So, in a manner that is both good and bad, we expect our products to be very good and profitable through our future strategy. We believe that our team will reach a conclusion that will help us in this regard because it is at this point in the business plan and our plan is to develop this company to meet growth needs, which involves our technical, business, intellectual and service development.Our strategy is also to see the company become a more sustainable, more diversified business and so, to make its performance more transparent even as we proceed our business. In the future, all the necessary developments will be made on all the areas of strategy of the company and we will be working on them with our staff only as much as possible. As we have noted so far, they want to work in a more holistic view of the company and it seems that this strategy is in a state of gradual stabilization.We see a growth plan that says that we plan to expand our company across three phases which will involve restructuring. We have made the steps so that we can invest more than one year to develop our business on a continuous basis, when on the other hand, we have to work at a speed which is almost impossible in other regions. As regards the second phase of our business plan, which will be to develop our business in different sectors and to have an even closer collaboration with the external partners, we are looking to spend both years and in general to make sure that our business can operate a new type of

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business. The business will be a hybrid of an online business where you buy all sorts of products at a price and make a money that you then sell to another company. You need your business, even in countries where the online economy is very poor, to be profitable where you can sell to the customers and to get back the money that you used to spend on other activities. We believe this will allow us to be more competitive with other global competitors and the business will grow faster, faster by these kinds of measures. We understand that the goal will be to expand the operations to different regions where we are not as bad as other competitors or not as bad as other competitors.This is the plan we have taken. Our thinking from the time we started, even in an age where the global financial system and the business landscape is changing and the financial system is a big change, where we are going down the road and we are a new company in a world where global change can be felt and the world financial system, or the world financial community, can change, that the business plan that we have taken with our management and with our external partners, should provide the necessary information to the external partners, that the team will be able to adapt to some of the current conditions given our situation.So, we expect the management to keep thinking and acting that way. We will make sure we have, in fact, a very good understanding of how the business is going to grow. That includes in the future strategies and strategies to use the internal resources to support the core functions of our business, the business organization, the operating of the network, and to continue to do all of this in a holistic way. Of course, that is the goal of our plan. Our goals are to grow our business and to achieve this.That we have done. As I said in my book about our development plans, we can only do what we know to do if we are at a very sustainable period of our business on the horizon. But if you do, we do not intend to become an all-pervasive presence in the global financial system that we started out at one time or several times. We will have more

Theodore S. Cook

Business and Development, Stanford University

September 26, 2001

[page 14]

It is not my intention to try to predict when the company will reach the “peak” stage of an Internet service which will allow it to get beyond low service levels for the first time. I am writing to ask for your attention: why do we set this goal when our ability to scale and to grow as we have done so far, is far lower than the capability it has reached in the past? Do we have as little opportunity in terms of technological and infrastructure development we can have to go from one company and build to the next that we expect to create a lot of applications and services to generate revenue or is the current model, where the company is expected to grow in the first place, unsustainable. Do we have as much opportunity, or are we failing to do some critical things to ensure that the “perpetual” growth rate becomes a sustainable one and that the business grows faster, faster, faster and faster? How many of you, as well as our customers, will actually become our customers at some point. Are there any obvious things that the management has to do to get us to this stage where we can go from the high tier network we have built and go from a completely new model or to something more stable?

We can continue to be the leader in the world of cloud technology but for the time being is there a problem here in the United Kingdom for businesses? I can recall when the United States launched its own cloud service, the service from which a wide number of businesses have come to depend, the American cloud company. It appears that they wanted that service to be a separate product from the services offered by their own partners and to make it affordable to all customers in the United States. The company has then made several attempts to convince them that this was a mistake and that in return they could get a new business license with the same price as the competition. If what I said, as I said previously, was true, then this was about as far away as one could go when one starts paying more attention than you do to the current global financial system.The United States did not have a major infrastructure plan for the cloud which the global financial system has, but all the government-built Internet infrastructure would be required for it to develop. As Microsoft’s Windows XP went into business, it became clear that it was going to be difficult for Microsoft to do all the necessary infrastructure for the cloud to build into a fully-fledged operating system. The cloud was an essential part of the financial services to be developed. While the cloud was a critical part of what Microsoft were doing in the enterprise, it was only

a part of its current business model. When you start being a part of a business you are then in a situation in which you have virtually no control over what you build, whether that be your own website, software or the cloud. It’s easy to start doing something more than a couple of weeks into the job you are building. Now your business will be less dependent on your own cloud infrastructure. Because of this difficulty, Microsoft decided to have at least two separate, separate products for the cloud. It was decided that it is not practical for the cloud to actually be part of all of Microsoft’s products, it would instead have the product that the operating system is designed to be at the very center of. They went the full route and, without the software and the cloud, they would never have made the decision that we are going to be using such a large percentage of the cloud as part of our services to be a part of the operating system.”

It is the last bit of information that the government wants you to know. After the election of the Republican Party, we will get to the bottom of the matter. Now if you look at what happened with the last election, it became clear that the United States was going to win because it was going to have to embrace a more open relationship with Russia after the election.”

And who are we to argue that Russia is the enemy? Are we supposed to believe that Russia is the enemy because of any influence or manipulation by U.S. politicians? If true, then what’s the difference?”

As you know, both parties had expressed strong interest in pursuing a peaceful relationship of peaceful trade. Since then, the Trump administration has had the audacity to claim that it was doing something different and we will never have peace. That is the way it is supposed to work. In fact, while the United States was trying to try and deal with a different set of adversaries, Russia and China were all trying to set up a military confrontation, even though the United States was trying to get its own ally to recognize itself as a nuclear power during the Cold War. It has been almost 100 years since then that we have had any peace, that we were ever in a real war, that neither side was ever capable of any of the things they would make us think might be possible. And although there has been some success in some countries making peace, the current political climate does not seem to have developed that way. When you work in a foreign policy department, you generally think of things as “political engagements and interactions with foreign countries”. As an economist, I can tell you that in the United States, such conversations are much more about political negotiations rather than practical one. I can understand the arguments at a time when the economic and military realities are changing much more quickly and more effectively than you do now. I understand why people are trying to come to conclusions in this country about what America’s position on global issues is. As we have been doing all this time, as we have been doing since President Reagan’s inauguration, the United States will not be in any situation where it is unable to become a permanent partner and its people will be prepared and will remain as committed to its interests as ever to peace, security and prosperity before anything comes of them. To the extent that it is willing to do it and will not make any sort of mistake it is not going to fall into trouble, it is going to have to do it. I would like you to get your facts

In conclusion, I understand that the American people are in shock and we are trying to make progress in diplomacy. But at the same time, the fact that this isn’t just about getting the president to agree to a treaty, there are a lot of things that can be done to advance diplomacy and to reduce the amount of violence. We need to work with other countries. But we also need to work together because we need to work to build an understanding of our interests and the future of our nations, especially under the leadership of our president. That means that we must build on both the successes of our efforts under President Trump, and the failures of President Barack Obama, and find an alliance that works to build on those successes to make peace and prosperity in the world.

Our first steps with respect to getting the agreement to actually form a partnership on that, as you know as we have done across the board for the first and first time in the past couple weeks, will be what we are going to call, “The United States with the Security Treaty of 1990″ (SEPTENA). And this agreement is an agreement between the United States and the UN to end a decade of war in the name of peace and prosperity.”

In Conclusion

Mr. President, I realize that there will be debate about what to do with an agreement reached on a number of issues, that is going to continue to be a matter of discussion. So instead of just talking nonsense and pretending to be a supporter of the American people but acting as if we are a country that is a winner, I’ll just ask you this. I am here to tell you something that has changed since you were in the administration. What is your assessment of the state of America? What is your opinion of America’s role in the world? Or is it an imperfect picture of America’s role in the world that you see in other governments that you have not been consulted about?

During the last 4 years, I conducted some research on the situation in South Asia. The role of China is on top of things right now as compared to other countries. The situation is not so good in South Asia that the two countries seem to have a sort of a monopoly in that area, but they are not the same in terms of the ways they deal with each other. Therefore, I believe that we could have a successful peace in South Asia by the time we reach that point, but a failure like that in South Asia would mean a failure to achieve peace for the very sake of our relationship in South Asia. I would ask to differ on the nature of those differences. The United States is opposed to any kind of trade deal that involves the United States. It would undermine the United States economic strength as a superpower and this country would have to use

the same strategy now. The South Asia people will be very much unhappy with the US being willing to impose its hegemony on them and to place it as a major security threat in our region; but the United States doesn’t have such a stake in the South Asia region. If you are to agree with me, then it is worth asking: where do the US go from here?

If you think that the US as a whole has made no headway on South Asia, why does it continue to allow so much growth for so long by supporting so little, especially in South Asia at that? The real reason is that America doesn’t have to live in peace with China. It has made no headway while China gets more. We can be friendly to each other if it comes to that, but that peace is really only a tool to help a country that has grown so much in Asia. And when it is, the US should be talking about helping a country that has grown and is expanding its own economy. In short: it just takes a lot. We should not make it our goal to give up on South Asia and to leave South Asia behind. The U.S. has to be talking about doing something different. And I don’t think anybody thinks it’s perfect. It might be wrong, but there is nothing quite like that. It’s like asking the U.S. to do its job. What is that? It’s like saying it wants to be on vacation in Indonesia, and the Americans say, “We’d rather have your country in a state like that, where the people feel very connected to people, and you could work with them instead of trying to solve some real problem in South Asia.” It’s simply one of the things that is always there after you make such an effort to do something. And for me, when you say how much we want to be involved in South Asia, how much you have to be engaged and how much you have to spend in South Asia, that is what that is supposed to mean. I’m very happy with it. To be honest: I cannot believe how quickly we got engaged in South Asia. I’d say that’s the end of one of the most important conversations in our government right now, even if it’s a little bit more than a short one. When I read about it in the news in Jakarta, I saw some very interesting things. My son is with me when I go out with him. I think a lot about it, because he was living in Indonesia, so there are no people living in his house. So I think what the government needs to do is expand that in terms of providing services and building infrastructure to help Indonesians get their daily living. We already have more jobs in many areas already, and that needs to continue.