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They are designing small neighborhood stores with carefully edited merchandise assortments to make shopping simpler. They don’t carry every brand and size, Just the most popular ones. G stores follow a fixed, even-dollar pricing schedule with about one-third of all merchandise priced at $1 or lower. G uses a strategic plan to grow rapidly in the market with tactics and strategies that drive consistent long-term profitable store growth. Their main strategy is that they are targeting municipalities that are home to fewer than 20,000 residents unlike the big box superstructure store model used by Wall-Mart and Smart.
The company considers that filling the role of neighborhood store is a big part of its success. In 1999, G had 3,687 stores. The passage explains that as of the middle of 2004, Dollar General operated 6,930 stores with 57,800 full and part-time employees in 29 states, with an additional 695 new store openings in 2004 alone. In addition to this, G earns the highest percentage on each dollar of sales like 4. 3 cents in 2004 while Wall-Mart earns 3. 5 cents on each dollar of sales. Dollar General accomplished this success by opening stores rapidly and running each store at the lowest operating cost possible.
Thanks to the information systems, G has reached its goals easily. They used a new and convenient system for opening new stores that provides step by step guide to open a store in eight days with a strict budget. By this new system, G is capable of stepping a new store in eight days. This system was very vital for Information ME Homework: Doll day savvy MEET 2014 Information Management Sys ASSIGNMENT I _ a) Explain and discuss the systems of Dollar General ad Egotistically, Teen. Fitness survival-bus discount retailer. I the most popular brands TTL ranks among the largest retie trusted manufacturers Ace usuries total Sd. Billion. Plat discount retailers. The Reese annual sales has grown a lot will come close to surpassing c_unpacks Increased 9 store sales Increased 3. 3*’ [ ; simplicity G stands for con prototype makes shopping a neighborhood stares ninth ca shopping, simpler. They don’ G stores follows a fixed, ever merchandise priced at $1 or DC uses a strategic plan tog drive consistent long-term p are target,Eng municipalities big box superstructure store m considers that filling the role m 1939, had 3. 087 stores Dollar General operated 6. 93 states, With an additional 69: DC earns the highest per cert.
Wall-Mart earns 3. 3 cents on success b/ opening stores r cost possible. Thanks to the They used a new and convert by step guide to open d Store G Is capable of sextupling a I DIM, so they were hiding the procedure like a top secret. Revealed by a magazine. To open a new G store, firstly they are choosing cheaper either shopping centers or freestanding buildings, with structures. Secondly they are electing a district or area construction team to perform any work necessary for the The opening process is carried out by a Setter who is a f employee at G.
The Setter organizes everything during iris day of setup, the crew unloads, constructs, and insist including shelves, counters, display racks, and refrigerate the floors and windows of the store. The second day of the new store opening process , the Egotistically office allows the purchase of point-of-sale Therefore IBM delivers the terminals on the second day. After the POS terminals are purchased, Spacemen which comes for installation of satellite. The satellite link con corporate headquarters so that the store can report Sal install the store’s satellite dish on the roof and a satellite to the IBM terminals.
Spacemen does its Jobs on the fourth he contract between G and Spacemen. According to the receiving $40 million over 10 years to fill this role for Doll connection is installed between the headquarters and n management transmits pricing data and product codes way the store can begin sending payroll information back needs a software to authorize credit and debit card pay data, so that Spacemen tests the point-of-sale software, c By the third day of the setup process, approximately 50 inventory arrives. The crew unpacks and shelves march delivered by the truckload in a few days.
After four days, opening process begins finally. Because and running. So the store manager can begin to train the and candidates for cashier Jobs on the IBM cash register code scanners that lay flat in the cashier counters, and t scanners to the registers. While training, there are also system to ensure that products scan at the correct price store are properly entered in the fields of the sales apply few days of setup processes are very busy like packing u goods. After opening the store, they are doing a final test satellite.
The opening process of G stores are much fast competitors. On the other hand information systems who and insufficient among its competitors. Dollar General s employee ($3,000 annually) than any of its dollar-store c Because of the fact dial-up and high-speed connections areas and stores were not always able to complete their chooses advanced satellite technology to communicate with headquarters. Is it sufficient to reach its goals and get more profit? No. Because there are some problems Dollar General is faced in spite of high-tech satellite technology.
First of some individual G stores do not need any network and never use satellite technology. IBM terminals have e-mail features but workers are not relying on it. They are choosing to use private voice-mail system for communication instead. Secondly managers use paper to track cash deposit logs, employee contact information, and the arrival of goods into the stores. This way is not proper for some reasons. The G managers are not using any computerized device to keep expense lower. They have a limited budget, so they cannot afford computerized devices.
Therefore, managers uses papers and it causes some problems. To sum up, G’S strategic business objectives is based on keeping expenses lower on technology. It affects their information systems negatively. However their usage of satellite-ethanol provides them both saving time and saving money. G believes that cheaper and t faster solutions are better for them. At the same time, the G has grown, thanks to the new stores and increases in same-store sales. 1 . B) List and categorize the (technological, organizational and social) complements assets for Dollar General.
Complementary assets are assets, infrastructure or capabilities needed to support the successful centralization and marketing of a technological innovation, the than those assets fundamentally associated with that innovation. [2] Dollar General(G) provides convenience, quality brands and low prices to its customers. G’S successful prototype makes shopping a truly hassle-free experience They are designing small neighborhood stores with carefully edited merchandise assortments to make shopping simpler.
They don’t carry every brand and size, Just the most popular ones. G stores follow a fixed, even-dollar pricing schedule with about one-third of all merchandise priced at $1 or lower. There are also other companies which sells merchandise priced at $1 or lower mostly, but G has an innovation in their field like building a new store in 8 days and with a very low cost. G’S opportunity to setup everything faster comes from a new technology which name is stereotypically. Using a satellite to communicate with headquarters makes everything simpler and faster.
After they are installed a connection between new store and headquarters, all pricing data and product codes can be loaded by this connection to the IBM terminals. This provides time saving and money saving. This IBM terminals and satellite-ethnology can be categorized as technological complementary assets. To track the inventory they receive and subsequently ship to stores, G’S distribute centers do use information systems. This system is running Catalyst warehouse management software. This system can be also categorized as technological complementary assets. The headquarters is the main decision maker in all the stores.
It determines the prices of products, it manages the marketing and it follow the sates. So this business model can be categorized as organizational In addition to main business model, setting up a new store in 8 days is a new business model. This model includes some steps which I mentioned in the previous question. By these steps, setting up a new G store is done in a harmony and perfect organization. So we can also categorized it as organizational complementary assets. In 8-days setup process, Setter educates new employees. Employees are learning how to use new cash register terminal and bar-code scanners.
This is a social complementary asset. Corporate headquarters maintains close control over every aspect of operation. The company distributes handbooks to employees that direct them how to communicate with each other and with customers. This is also categorized a social complementary asset. 1 . C) Discuss the business challenges Dollar General faced and how they reacted. (10 points) Firstly, Dollar General wanted to grow rapidly, but it had big competitors like Wall-Mart, Smart. So Dollar General had to create new ideas to stand out from competitors. Consequently they choose to open more stores on more cities in a short time.
They used a business plan to open more stores in a limited time like 8 days. They raised experts to open a new store who are called “Setter”. These Setters are installed thousands of stores around US. Most of these stores are managed from a center called headquarters. The communication the stores and the headquarters are done by satellite, so all stores have this satellite technology. In this way, communication become very easy and safe indeed. They solved these business halogens in a clever way. Secondly, Dollar General(G) faced some problems on organization.
To track the inventory they receive and subsequently ship to stores, G’S distribution centers use an information systems which is called Catalyst warehouse management software. However, recipients at the stores merely check to see whether the cases are sealed properly. Inventory management depends on the polling data that headquarters gathers from store cash registers each night, which indicates how many of a product were sold and at what price. G has an increasing shrink rate, which refers to the percentage of total sales that he company writes off as losses resulting from theft of product or other mishap.
Store managers considers that most of the company’s losses are caused by merchandise being stolen during shipping, which goes undetected because there is no scanning upon receipt, and to shoplifting in the stores. According to the passage, G’S shrink rate has grown steadily from 2. 6 percent in 1998 to 3. 05 percent in 2003. The company’s goal is to keep shrink rates to no more than 1. 75 percent to 2 percent. Corporate headquarters has chosen to focus on the employees as the root of the problem.
They try to solve this problems by deploying loss prevention software, which identifies unusual cash register transactions, and installing video cameras to monitor the registers, the stockroom, and even the store manager. These measures does not change the shrink rate. But they continue to this strategy. How did information systems help them to address these challenges? (5 points) The information systems are used for organization, communication and management. Headquarters has a satellite-ethnology to communicate with stores and manage them. This technology allows G to achieve a lot of problems.
G used loss prevention software to identify unusual cash register transactions, but it does not help them to keep shrink rate same. Moreover, they installed video cameras to monitor registers, the stockroom, and even the store manager. This solution is also useless. 1 . D) Does Dollar General miss out any business opportunities as a result of its approach to information technology? If so, what are these opportunities and what actions should it take to take advantage of these opportunities? (8 points) Dollar General do not choose to use technological tools, so they miss out some opportunities.
There are computerized systems which can be used to track products and sales, but G managers are not using any computerized device in order to keep expenses lower. They have a limited budget, so they can not afford computerized devices. Therefore, managers uses papers and it causes some problems like loss of some products. They are not sure the amount of products which they receive from supplier. Because they do not count what is in the boxes. If they had used a software to track products supply chain, they would have more profit because there wouldn’t be any loss on products. What have you learned from this homework?
How do you think it may help you in your studies and in your present (or future) career? This homework is about how information technology is important in our business strategy. I learned a few key ideas from this homework. First of all, I learned the strategies of Dollar General used in the past. In my opinion, they were very lucky. Because at the beginning of the 2000, there are not much competitors on the business of 1 dollar-sector. They were selling everything for 1 dollars. But now a lot of people tries this business. In Turkey, this kind of stores are opened approximately 6-7 years before. They are copying the strategy of Dollar
General. G was the first which uses 8-days-setup model to spread around the US rapidly. Secondly, I learned that to be more profitable I need to understand the concepts of information technology and complementary assets. I can then develop strategies to increase my profits, including ways to increase my sales revenue and decrease costs. I can use use the tools, diagrams and information technology in this guide to help calculate my profit goal, minimum sales requirement and to chart the most important products for my profit margins. Thirdly I identify and understand the financial factors that affects business strategy.