BMC(ENT300) - BMC case study for Entrepreneurship subject uitm PDF

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ENT 300ENTREPRENEURSHIPBMC REPORTSPORTS DIRECT INTERNATIONALPREPARED BY:PREPARED FOR:NO. NAME ID NO GROUP CODE1. MUHD NOR AZWANBIN NORDIN2020131989 PHM1152CLECTURER’S NAME : MADAM TUTY RUBIANTISEMESTER : OCT 2020 – FEB 2021SUBMISSION DATE : 18 thDECEMBER 2020NO. CONTENT PAGE1 Cover Page 1 2 Table Of...

Description

ENT 300 ENTREPRENEURSHIP BMC REPORT SPORTS DIRECT INTERNATIONAL

PREPARED BY: NO. 1.

NAME MUHD NOR AZWAN BIN NORDIN

ID NO

GROUP CODE

2020131989

PHM1152C2

PREPARED FOR:

LECTURER’S NAME

:

MADAM TUTY RUBIANTI

SEMESTER

:

OCT 2020 – FEB 2021

SUBMISSION DATE

:

18th DECEMBER 2020

1

TABLE OF CONTENT NO. 1

CONTENT

PAGE

Cover Page 1

2

Table Of Content 2

3

Executive Summary 3

4

BMC Introduction 4

5

Business Model Canvas of Sports Direct Int.

5.1

Key Partners

5.2

Key Activities

5

6 7 5.3

Value proposition 8

5.4

Customer relationship 9

5.5

Customer segment 10

5.6

Key resources 11

5.7

Distribution channel 12

5.8

Cost structure 13

5.9

Revenue stream 14

6

Appendices

15-16

7

References

17

2

EXECUTIVE SUMMARY

Established in 1982, Sports Direct International has grown to become the UK’S number one sports retailer.The first shop was opened in Maidenhead under the name of Mike Ashley Sports. 2 years later, Preston Sports shop was opened in London and by 1992 the Company had 12 stores.The Group operates a diversified portfolio of sports, fitness, fashion and Premium Lifestyle fascias in over 20 countries. The company have approx. 30,000 staff across five business segments: UK Sports Retail, Premium Lifestyle, European Retail, Rest of World Retail and Wholesale & Licensing. Our business strategy is to invest in our people, our business, and our key third-party brand partners, in order to elevate our retail proposition across all our channels to attain new levels of excellence. The Group aspires to be an international leader in sports, lifestyle, and luxury apparel retail, by offering our customers a dynamic range of iconic brands. The purpose of this report is to clarify the Sports Direct Ineternational company model canvas.

3

BMC INTRODUCTION

In this day and era, it is undeniable that business play a very important role especially in consolidating the nations strength by fueling our past economic recoveries. Therefore, there are countless of business being proposed and carried out among our society in order to keep the growth of economy. Business Model Canvas (BMC) that was introduced by Osterwalder (2008) is a visual framework for describing the differentelements of how a business works. It illustrates what the business does, for and withwhom, the resources it needs to do that and how money flows in and out of the business. It can be used to design new models or to analyse current models.

Along with this outstanding insights and ideas that become much better as time goes by, business model canvas have been introduced widely and have become a part of strategies to interpret and value one’s ideas into real business.

To introduce more about this topic, business model canvas can be defined as a strategic management and lean startup template for establishing new documenting existing business models. It is also known as visual chart filled with nine blocks of elements describing firms’ or product’s value proposition, infrastructure, customers and also finances.

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SPORTS DIRECT INTERNATIONAL BMC

5.1 KEY PARTNERS As a third-party reseller, the Sports Direct Int. company have been signed a various partnership with various brands such as Nike, Adidas, Slazenger company so that they can get the supplies for the sports equipmen such as shoes, Shirts, Sport outfits to the company. The Sports Direct Int. also get supplies equipment from the Puma Company. These companies will be received some of the profits that the Sports Direct international get from selling the product. The raw materials that the company get from three suppliers are in a good condition. The suppliers did give them the best sports outfits and shoes to operate the business very well. The customers also satisfied with the products that the company offers. The main resources that the company get from the suppliers are sports outfits and sports shoes. The Nike and Adidas company will provide the sports outfits and shoes to the Al - Ikhsan so that we can display and promote the stuff then they can proceed to sell the product to the customers. If Nike and Adidas Company can not supply the sports stuff, it will be a big problem to them because the company can display and promote the product. If that happen, they can not sell the product and also, they will be losing customers and Profits.

We work with our leading third-party global brand partners and provide significant prominence for these specialists with our customers across all our platforms. Our third party and Group brands are managed by central brand and marketing teams. This centralised structure significantly benefits the Group by enabling the individual brands to participate in Group buying and sourcing; aggregated supplier relationships and enhanced supply chain disciplines; Group inventory monitoring and replenishment; and more inspired and harmonious visual merchandising in-store.

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5.2 Key Activities According to Strategyzer, when it comes to the Business Model Canvas, key activities are any activities that your business is engaged in for the primary purpose of making a profit. Business activities include operations, marketing, production, problem-solving, and administration. We continue to strengthen our relationships with our key third party brand partners via the elevation of our sports retail proposition.

This has included the completion of showroom suites at our head office, which were individually developed by our brand partners Nike, adidas, Puma and Under Armour. Each showroom is a bespoke brand centre, which ensures leading brands are deeply embedded within the DNA of Sports Direct. In addition to working closely with third party brands, sports direct also maintain a significant portfolio of our own brands across Sports and Leisure, and Fashion and Lifestyle. Sports Direct Int. Also maintain significant investment in their brands to preserve value, and are proud to have a number of high-profile sporting and entertainment personalities, as well as international sporting events, and sporting venues as ambassadors for their brands.

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5.3 Value Preposition The Group aspires to be an international leader in sports, lifestyle, and luxury apparel retail, by offering our customers a dynamic range of iconic brands. They value their people, their customers, shareholders and third-party brand partners - and strive to adopt good practices in all corporate dealings. They are committed to treating all people with dignity and respect. Sports Direct endeavour to offer customers an innovative and unrivalled retail experience. They are aiming to deliver shareholder value over the medium to long-term, whilst adopting accounting principles that are conservative, consistent and simple. Sports Direct has been accesible to all more than ever. Sports Direct is spreading out to different locations globally, in both official stores and outlets, including online stores and shipment. By acquiring multiple other footwear and clothing firms – its easy access is almost inevitable. Customers can easily reach out to their products in their everyday life.

Sports Direct aim to deliver an unrivalled range, availability and quality of products – both third party brands and Group branded products – with different customer value propositions across their sports, lifestyle and premium fascias. The elevation strategy continues to enhance and improve their stores and all their digital operations, product offering, and marketing channels. This is vital to strengthen sports direct relationships with their key third party brand partners, to deliver benefits for consumers, and to drive the Group’s long-term profitability.

It is the Group’s policy to treat all their people with dignity and respect. The Sports Direct Group consists of approx. 29,400 staff, who work together across all areas of the Business. They are proudly that Sports Direct International plc is one of the first public companies in the UK to make an elected Workers’ Representative a Board member. Sports Direct welcome all new employees into the Group following the acquisitions in the year.

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5.4 Customer Relationship The relationship between an organization and its customers is categorized as one of the three classic market relationships described by Gummesson. According to Gummesson (2008), the relationship between customers and supplier form the foundation of commercial exchange. Sports Direct has a good relationship with their customers, they have some kinds of insurance for their products, customers can have their shoes, sneakers or other stuff fixed in couple of months. They also have good customers' service. I have bought some sneakers at their and surprisingly they have kept some information about the customer, they try to understand my needs, receive my feedbacks. Through getting good relationships with customers, Adidas have been successively renew their designs, get models up to date to meet customers' demand and also compete with other competitors. Sports Direct has sponsorship deals with many of the world's top athletes, clubs, and sporting events.

As to remain their customers to stay and buy their product, the Sports Direct Company had provided the membership card to the customers. With the member card, the customers get to buy the items at their store with 5 – 15% off discount. They also will send them through email and direct message of what their store will be having. For instance, they will send them a message about having a promotion at their store. At their page, the customers and also give their reviews and feedback about their product and services. Besides that, every Saturday, the customers including non member can get a promotions. When they spend minimum RM80 and above they will get the 10% discount. With that ways, the customers will have to repeat order with the company and they will not be losing the customers.

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5.5 Customer Segment Customer segments are the community of customers or businesses that you are aiming to sell your product or services to. Customer segments is one of the most important building blocks in the business model canvas for your business, so getting this building block right is key to your success.

Their target audience are teenagers and adults. But their main target is university students. This is because university students always interested in sports item for their daily sport routine. So, they will find the store which offers designing, printing, and selling sports items with the affordable price. Sports Direct store can suggest the design to the students. Then we will find the items exactly like they want. For students, they also have a promotion for them. If they buy with students’ ID they will get 12% Discount.

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5.6 Key resources

Key resources is the building block describing the most important assets needed to make a business model work. Every business model requires them, and it is only through them that companies generate value prepositions and revenue. Key resources can be categorized into four types which is physical, intellectual, human and financial. Physical assets are tangible resources that the company uses to create its value proposition. Physical resources such as raw material, buildings, vehicles, transportation, storage facility and machines. Sports Direct company physical resources are the fabrics, qualities and design that they get from the supplier. Without those resources their company cannot produce the good product to the customers. They need the qualities as their main resources, then they need a best design to produce the items and get profits. Other than that, intellectual resources also important to their company.Intellectual resources such as their brand, patents, copyrights, partnerships, and customer databases. All the organization wants to protect their ideas through patents. Ideas and developed products are easy to imitate. Patents protect the business organizations from such imitation that may affect competitiveness. They also invest in copyrights to protect certain work from being copied. The copyrights offer legal protection for a certain period of time.

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5.7 Channel

Sports Direct elevation strategy continues to work towards improving their offering to customers across all of their channels, including marketing, social media, product, digital and in-store. This aims to enable the Company, along with third party brand partners, to connect with customers via a consistent voice across multiple platforms, including online, mobile, and on the high street. This strategy enables stores and online operations to complement each other.

The websites for each of their core fascias in the UK, including SPORTSDIRECT.com, USC.co.uk and Flannels.com, have undergone significant enhancements in order to facilitate optimum appeal to consumers. Their product offering across these core fascias, both in-store and online, aims to create a compelling shopping experience in key categories that include, among others, Football, Women’s, Kids, Running, Cycling, Lifestyle, Fashion and Luxury.

Sports Direct offer product across a range of price points, including good, better and best. This enables us to offer more premium product, which is net-new to the Business. This gives consumers a greater range of choice for those who wish to shop for premium products, whilst still retaining their original entry-level and standard product offerings.

Besides that, they also advertise their product to the public. For example, they buy the space at the newspaper to promote their product to the reader. They also buy the space to advertise their product at social media like Facebook and Instagram. So, when people scrolling down the social media, they will get to see the ads. They can just click the button to go through the page or go through to their WhatsApp number that they had provided.

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5.8 Cost Structure The cost structure describes all costs incurred to make a business model work. Such costs can be calculated relatively easily after defining key resources, key activities and key partnerships. Sports Directs’ cost of sales amount includes cost for all beverages and product sold as well as their expenses for store rental. Besides, in order to maintain long-term relationship with its employees, they need to pay salary and wages to its employees. Not only that, to accommodate more customers in their retail store, they one to buy more facilities and upgrade their remaining store bigger to accommodate more customers at one time. Besides that, The company had invested the cost for resources to pay to the supplier that gives supplies to them. The supplies that they get from the suppliers are the material that they need such as sport shoes, sport pants, socks and others. All the suppliers will be paid every month after Sports Direct store had sold their items to customers.

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5.9 Revenue Stream Revenue streams is the building block representing the cash(not profit, which is revenue minus costs) a company generates from each customer segment. The value that their customers really willing to pay for their product is because the material of the product that they are using. Customers really satisfied wearing their product. Some of the customers had give their feedback through the page saying that they feel comfortable wearing their items such as jersey because the materials of the jersey or sports outfits that they are using. The customers would like to buy more from them. Some of the customers that usually bought only a few items such as sport bottle now already booked a few packs of it. Those customers already become their loyal customers and keep repeating order with them. Those customers that come to their store and buy an event items, they allowed them to pay deposit first as they are going to prepare the order, then they also can pay the full payment when the packaging is done.

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Appendix No.

Figures About

Sports

1.

store

Direct in

a

Malaysian Mall

2.

Their staffs in full sport outfit

Example 3.

their brochure

14

of sales

4.

Sports Direct’s online website and apps

15

References

1.

https://www.sportsdirectplc.com/about-us/strategy/strategic-segments.aspx

2.

https://web.archive.org/web/20120204113943/http://www.sportsdirectplc.com/comp any-information/about-us.aspx

3.

https://www.cleverism.com/customer-segments-business-model-canvas/

4.

https://www.culturehive.co.uk/wp-content/uploads/2016/01/Introducing-the-Business -Model-Canvas.pdf

5.

https://www.sportsdirectplc.com/~/media/Files/S/Sports-Direct/annual-report/annualreport-2019-final.pdf

6.

https://www.sportsdirectplc.com/about-us/business-model.aspx

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