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Exercises Small Tutorial 6
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Small Tutorial (WG)Exercise 6
1. What modes of transportation are best suited for the delivery of time-critical
small packages? Why?
By plane or truck. These are faster and suitable for small packages.
2. Compare the transportation costs for an online business such as Amazon and a
retailer such as Home Depot when selling home-improvement materials.
Amazon: Since amazon is an online business, they have to deliver each order to the
customers. These are spread across a wide region and transportation costs are therefore
higher. They have to deliver small quantities to customers all over the region.
Home Depot: Since Home Depot is a retailer, the customers pick up their own order. They
only have to transport their goods to the few retail stores they have. This can be in bigger
quantities, since they can keep inventory in the store. This saves costs compared to Amazon.
3. Deliveroo is a British online restaurant food delivery service now available in
29 countries (https://deliveroo.co.uk/faq). What transportation challenges does
Deliveroo face? Compare transportation costs for home delivery restaurants
and traditional restaurants.
Deliveroo has higher transportation costs, since they use milk runs. They have to deliver in
small quantities to each buyer in the region. They also need fast transportation, since
customers expect their food fast, because it is restaurant food delivery. Further, they make
empty runs, because they take food to the customer, and return without goods. So that makes
the transportation costs even higher.
4. Answer the questions of the case study that follows.
1.
Blue Nile: Customization, low-pressure selling tactics, easy access to information available
for customers, higher price segments for a relative low price, money back guarantee, fast
delivery, high customer service, large product variety, large product availability, online.
Zales: Low prices, online sales as low-pressure selling tactic, credit plan to make it affordable
for more customers.
Tiffany: Great brand value, own designs, high end products with therefore higher prices,
large product variety, lower end products with lower prices to attract customers in different
price ranges, online and retail sales.
2.
Customers tend to buy products with high prices in a retail store, so they can see the product.
Therefore, Tiffany’s lower priced products would be better fitted for the online channel.
3.
By not selling their engagement rings online, they maintain a certain exclusivity which
attracts more buyers for their high end products and which makes the brand Tiffany
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