Logistics has been one of the most important activities of easyInternetcafé (eIc) in the opening of new locations. It has become one of the few non-core activities that are in direct control of the company. It means supplying eIc locations across Europe with initial assets, furniture and PC’s. It also means managing all the activities in relation to opening all new stores. However under the new business model of franchises, eIc is now to only deliver proprietary equipment to the franchises, and all the other activities involved with opening new locations are the responsibility of the franchisees. There are many steps involved with launching a new location and eIc has a strong interest in its success. Due to high costs and inefficiencies that have occurred in the present logistics program I have researched options in finding a solution to working towards success in logistic for both eIc and each new franchise owner. My proposed strategy for logistics is working with a third party provider or 3PL. 3PL providers offer services in the forms of shipping to complete supply chain solutions. If eIc is to be successful in the next phase of the internet café market, utilizing a 3PL provider is the best solution to moving forward in a constantly changing industry. The new 3PL provider will work with us in getting the proprietary equipment to the franchise as well as helping the stores set up including ordering internet services through to the first day of operation. To achieve the goal of five-fold growth and a level of multiple stores opening per week the logistic program must be effective, efficient and flexible. After each location is up and running the new franchise owners will have the opportunity to supply feedback to eIc with critical information about working with the 3PL provider. This feedback will help identify what aspects of the program is working well and where improvement is required for growth and success.
Currently the shipping of equipment out to locations is done poorly without any plans or service provider agreements. This has resulted in high costs low growth and inefficiencies. With the goal of opening numerous stores at one time, logistics needs to be cost efficient, effective and flexible enough to handle the increased level of activities, without being a burden on eIc or franchisees both financially and efficiency. Each franchise location expects the arrival of their products to be on time and cost effective. Many locations open in similar areas requiring shipments at the same time. Consolidation of shipments, cross docking and on time delivery provides long term effectiveness and cost reductions for all new franchises. This is not the current situation. Shipping out the equipment to the franchise is not the issue, how to ship the equipment is the question. Who will provide the service on a long term basis that can continually meet ever changing demands in purchasing, inventorying and consolidating of orders for all the new franchises? Systemic Issues:
Strategic – short term and Long term
The set up of new locations require shipment of proprietary equipment and furniture. Shipping via a carrier that has low costs and can deliver on time is critical for targeted opening dates. Delays are not favourable. Consolidation of orders to new franchisees in multiple locations within similar areas is cutting transportation costs. Using a logistics service provider that will work with eIc’s current suppliers and support the franchises with any problems or situations the come about due to unexpected situations. Essentially become a point of contact for the franchises, to trouble shoot and problem solve and become the store set-up support. Environmental Analysis:
The newly outlined strategy of EasyInternetcafé is to franchise its operations. Downsizing to smaller venues with fewer internets PC’s terminals is the plan for quick growth. The cafes would be...