Easyinternetcafe Cafe Essay

This case report addresses the ch tout ensembleenges to down a unsanded logistic arranging that if well implemented it can meliorate operations and can convert easy networkcafe into a profitable company. EasyprofitCafe (eIC)is a chain of Internet cafes with stores in the UK, the USA, Holland, Belgium, France, Ger many a nonher(prenominal), Spain and Italy. eIC is part of the Easy Group, headed by the Greek entrepreneur Stelios Haji-Ioannou. The original air model is to build and operate on the principle of economics of scale or succumb Management most stores would be open 24 mins a day, 7 days a week, and each has an mediocre of 350 PCs. In 2003, with losses continuing to mount, eIc management has decided to radically renew their operations. In order to eliminate the desire for future investments in new stores, the system was changed.It has been decided to appoint franchi conditions for the new stores and also, if possible, for the vivacious legacy stores. According to the new strategy, the franchisee would be required to bear the costs of the airscrew and the hardware. It was also decided to move from cosmic stores to smaller stores with 20 to 30 PCs. The real logistic situation represents a hinder and it is hotshot of the major ca enjoyments for the ongoing losses at easy netcafe. After reviewing different logistics scenarios and providers, I strongly recommend taking a closer look to support the logistic alternative that Ingram Micro is proposing. If we do that, we could proceeds in the warehousing, accounting and transportation areas, by dint of all this areas, it will help us reduce the logistics costs and labour per new store, from almost to 2,000.00 to 1,357.00, this and the benefits mentioned before, will help us to achieve our overall objective of organism a profitable company. This will be the strategic perspective that will be demonstrated passim the report.Issue(s) Identification1. Yield Management does not work for each compa ny. eICs first store open(a) in June 1999 opposite in London. briefly afterwards, it was quickly acknowledge that eICs final payment management had certain characteristics that later unnatural the commerce model elC was offering a spunkyly perishable product 1 moment of Internet access age, cannot be put in inventory, at one time that hour is gone, at that place is no demeanor of reselling that hour of internet access date. Although stores are large, condenser is limited Internet access adopt varies, not only by prison term of day, day of week, but also across other time and seasonal horizons. additive costs are next to naught it doesnt matter whether there is one person or 500 in a store, the bandwidth is already there. By the time the second and third stores were opened, eIC had built give out management into its store management system.2. underway Logistics SystemLogistics is not a inwardness competency at elC, but it has stimulate one of the integral activ ities. Logistics for elc means to sum the new stores with their initial assests, including all of the piece of furniture and PCs. This system is a drag on scalability, efficiency and a bottleneck for emergence and the main reason for spiraling high cost and ongoing losses.Environmental and ascendent Cause AnalysisAggressive use of yield management is a recognized and admired business model of Stelios. EasyJet was a profitable company after near a few years of operation. However, with EasyInternetCafe kale seem a long way off, the assumption that offering very first base prices would increase the demand significantly elapse to losses of 80m-100m from 199 to 2002. Below are many root causes of the symptoms above * The stores are in addition large economies of scale dont materialize if occupancy is half empty. * opinionated costs were too high receivable to the quantity of Pcs per store. * Staff overheads were excessive.Assumptions* Are there sufficient customers who want t o use an internet cafe? To-day, most of the homes have internet access, and many others have (free) access at their place of work or at colleges or university. * Are the stores located in the right place to attract customers throughout the day and the whole week? business district cafes might attract business the great unwashed needing to keep in touch, but many city centres are quiet in the evenings and at weekends. By mid-2001, with cash zip out a drastic movement was necessary a franchising plan is cosmos developed. It is important that every cafe looked the same, with ballpark signage, furnishings and PCs.The time to sign a concentrate with a franchise is one week. If the franchisee did not already have space for the caf, eIc would care in recommendations with locations within 28 days. The broadband internet connection had to be installed by the local telecoms supplier within 28 days. Also they need to Desk installed within vii days. Server delivered and installed 2 days and PCs delivered and installed 2 days. CVM delivered and installed 1 day Signage delivered and installed 1 day. Chairs delivered and installed 1 day. Testing complete system 2 days and also Open for business within one day. So, how much time should it take to open the cafe once the contract is signed? From the predecessors plan we see that average duration of time for all activity. Under bellow we discuss or so time of the contract are signed.