For this assignment, I have chosen to study the North West Kent area. For this particular area of study, I am going to look at how retail has changed over the last 20-25 years and how retail is changing today.
I hope that I will gain a valuable insight into where, how and why people decide to shop. I am going to study the various distribution services that provide the supply chain that continuously transports goods from the producer to the buying consumer.
Through this assignment, I will report about the role that shopping has in our everyday lives and how the retail industry as a whole reacts to this.
Over the last 20-25 years, there has been a considerable increase in the number of out of town shopping centres. The North West Kent area is a good example of this as it is home to the largest out of town shopping centres in Europe- Bluewater. The reason for Bluewater being at this particular location is because:
* It has good transport links to London and the surrounding South Eastern area.
* It is in close vicinity to the capital.
* Runs directly alongside the M2, a major link from the ferry terminal at Dover to London.
* It was built on and old, disused chalk quarry, this would minimise the local land loss.
* Less likely to encounter congestion unlike inner city centres, so the probability of receiving a parking space is increased.
Before the construction of Bluewater, Greenhithe was a small town with a few shops, but it was because of the vast amount of open space it had free with the abandoned quarry, it had a large amount of potential.
The introduction to an out of town shopping centre like Bluewater to a rural environment such as North West Kent has brought in many different high street brand outlets, as well as designer and specialist shops. This is mainly due to the fact that this particular shopping centre is large in size and therefore will be certain to diversify in its range of high quality shops.
Travelling to Bluewater is not only a shopping experience, but a leisure experience also. Cinemas located on the premises provide whoever is visiting Bluewater with recreational activities. This adds to the success of an out of town shopping experience such as Bluewater.
As there is a high car ownership and suburban population in the South East of England, people will travel further to shop out of town, as at an out of town centre, shoppers can then be compensated for what their local High Street doesn’t have to offer them. As at sites like Bluewater, the services provided to the customer are so appealing and run at a competitive nature that many High Streets cannot match. The competitive nature of an out of town shopping centre such as Bluewater is highlighted in the cheaper import/export costs nowadays. It is cheaper for large organisations to buy in large quantities because they can be purchased for a cheaper price. This can then demonstrate a loyalty between the suppliers and the retailers, so that the retail price can then be lowered as a direct result.
Changes in the distributive industry
Over the last 20-25 years, there have been many changes in the supply chain as cutting edge technology has became increasingly significant in this division of industry. This is increasingly more apparent in the North West Kent Area. For this task I will look at the changes that industry has undergone to meet the needs of retailers and the demands of the consumers. I will explain this in detail, including references from my chosen area.
Changes in the types of transport:
Many forms of transportation are available to the distributor today. For example: In the UK, during any one week at McDonald’s, 90 vehicles will make over 2,000 deliveries and travel over 112,000 miles. Each of the delivery vehicles can carry frozen, chilled and fresh goods at the same time. This method of transport was not available 20 years ago, so it made a definite positive impact on the transport industry in this country.
The role of delivery services:
The role of the delivery service has been greatly enhanced and has been granted greater responsibilities, for the use of computers has meant company policies have had to change with the times. Company employees now have to be computer stimulated ensuring that goods get delivered at the right time and in the correct quantity. As with McDonald’s, delivery companies have increased in size and cover a much larger area, sometimes worldwide.
How storage systems are changing:
Large companies nowadays have introduced a computerised warehouse management system. This method has replaced the paper forms and instead launched electronic documents. Electronic documents are now sent with truck drivers when deliveries are made. They incorporate the same information found in the paper document, but can display more information when required. E.g. computers can check details of the stock held in the shops, and warehouse and retail operations are linked together automatically.
Also, because of the reliability of the modern day delivery services, storage systems in stores have began to decrease in size. For example: 20 years ago, supermarkets used to have quite large storage facilities located on site. But with the introduction of a mainly computerised modern industry, and with advances in storage techniques, outlets can afford to reduce the storage areas in exchange for larger floor areas to which more stock can be sold from.
As mentioned before, large companies have computerised warehouses. Here are some of the changes that have been made within the warehouse itself:
* Forklift trucks now have on board computers and are linked by radio.
* Load and route planning systems are now operated by computer systems.
* Stocks in the warehouse can be counted easily so that amounts of stock exported can be replaced with more of the same.
Large wholesalers nowadays rely heavily on computerised sales to retail outlets. This is implemented in the distribution for multi- product firms, especially when large geographical areas are involved. By using a wholesaler, the manufacturer is able to deliver all six products to one site, so the computerised influence relaxes heavily the burden that is involved in market research with retailers.
Retailers can now send information via computer to the wholesaler on how their stock is selling in different areas, without calculations made by people, minimising the occurrence of human error.
RDC’s have increased in size so that the outlet floor size can be increased. The amounts of RDC per store have also become greater. For example, one store may receive its fresh goods from one RDC, and its frozen goods from another. So, there is a greater selection of specialist RDC’s available to any one retail outlet.
Variety of goods that are now being transported:
The introduction of centralised warehouse systems mean that a lot more frozen goods are transported. Whereas beforehand there were not these facilities, now that there are, specialist stores such as Iceland emerge- taking full advantage of these facilities. Because nowadays there is a large variety of frozen goods, this type of stores satisfy the needs of the customer so well, less travelling is needed so that the desired product can be purchased if not available in a certain store.