Question

CASE STUDY: Good Sports Ltd.

Good Sports Limited is an independent sports goods retailer owned and operated by two partners, Alan and Bob, based in the country of Oceania. The sports retailing business in Oceania has undergone a major change over the past ten years. First of all the supply side has been transformed by the emergence of a few global manufacturers of the core sports products, such as training shoes and football shirts. This consolidation has made them increasingly unwilling to provide good service to the independent sportwear retailers too small to buy in sufficiently large quantities. These independent retailers can stock popular global brands, but have to order using the Internet and have no opportunity to meet the manufacturer's sales representatives. Secondly, Oceania's sportwear retailing has undergone significant structural change with the rapid growth of a small number of national retail chains with the buying power to offset the power of the global manufacturers. These retail chains stock a limited range of high volume branded products and charge low prices the independent retailer cannot hope to match.

Good Sports has survived by becoming a specialist niche retailer catering for less popular sports such as cricket, hockey and rugby. They are able to offer the specialist advice and stock the goods that their customers want. In recent years Good Sports has become aware of the growing impact of e-business in general and e-retailing in particular. They employed a specialist website designer and created an online purchasing facility for their customers. The results were less than impressive, with the Internet search engines not picking up the company website. The seasonal nature of Good Sports' business, together with the variations in sizes and colors needed to meet an individual customer's needs, meant that the sales volumes were insufficient to justify the costs of running the site.

Bob, however, is convinced that developing an e-business strategy suited to the needs of the independent sports retailer such as Good Sports will be key to business survival. He has been encouraged by the growing interest of customers in other countries to the service and product range they offer. He is also aware of the need to integrate an e-business strategy with their current marketing, which to date has been limited to the sponsorship of local sports teams and advertisements taken in specialist sports magazines.

Above all, he wants to avoid head-on competition with the national retailers and their emphasis on popular branded sportswear sold at retail prices that are below the cost price at which Good Sports can buy the goods.

REQUIRE

(1) Provide the partners with a short report on the advantages and disadvantages to Good Sports of developing an e-business strategy and the processes most likely to be affected by such a strategy.

(2) Good Sports Limited has successfully followed a niche strategy to date. Assess the extent to which an appropriate e-business strategy could help support such a niche strategy.

Answer 1

1.E-Business stratergy:-

Advantages of ebusiness:-

1. Removes location and availability restrictions
2. Reduces time and money spent
3. Expedites customer service

Disadvantages of ebusiness:-

1. Lack of personal touch
2. Delivery time of the product takes time
3. There are a lot of people who scam through online businee, hence it has security issue

2. The appropiate e-buiness stratergy to support their stratergy would include the following:-

1. Make the website user friendly
2. Website should not get stuck due to heavy consumer inflow
3. Marketing should be done by sponsoring global tournaments and developing a brand image.