Retail Enterprise Management Report

This report provides a comparative analysis of two retail giants, Noel Leeming and Apple, focusing on their operations within New Zealand. The analysis delves into various aspects of their retail strategies, including merchandise mix, ownership structure, location advantages (both operating withi...Read More

Running head: RETAIL ENTERPRISE AND MANAGEMENT
Retail Enterprise and Management
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1. Overview
Overview of Noel Leeming
Noel Leeming is one of the leading consumer electronics and appliances retailers of New
Zealand ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). The company
is the brand retailer of the Noel Leeming group. The company offers the widest range of
electronic goods and appliances of the top brands. The various products offered by the retailer
include computers and tablets, phones and GPS, televisions, audio speakers, cameras, digital
wearables ("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Along with
these, the retailer also sells the kitchen appliances. The household appliances, drones and digital
games, digital toys, health and personal grooming kits are also offered to the customers. The
Noel Leeming store is located in the Palms mall, in New Zealand. The Palms is one of the
biggest shopping mall in New Zealand and the Noel Leeming store located at the Palms mall is
one the biggest advantage for the store ("Welcome to Noel Leeming | Technology & Appliances
in NZ", 2017). This is because, a huge footfall is seen at the Palms mall and the store being
located there, has an added advantage of attracting a huge number of customers.
The organizational structure of the Noel Leeming is tall. There are a huge number of
hierarchies, since it is a large organization and the tall organizational structure is suitable in a
large business organization (Grant, 2016). The ownership structure of the company is formed
with a CEO and a large number of board members. Australian-base private equity firm owns the
Noel Leeming group. The CEO of the company is Tim Edwards ("Welcome to Noel Leeming |
Technology & Appliances in NZ", 2017). The main purpose of the retailing mix is to address
the needs of the customers successfully, along with formulating strategies. The coordination of

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the various operations, along with responding promptly to the competitors is the main purpose of
the retail mix (Boone & Kurtz, 2013). The components of the retail mix include the product,
place, promotion, price, presentation, personnel. The products of the Noel Leeming are of wide
variety and of various international and local brands. The customers are given a wide variety of
choice from a wider range of products, such that they are able to make their choice successfully.
The prices are competitive and same across all the Noel Leeming stores (Khan, Alam & Alam,
2015). However, the store often offers heavy discount to the customers, thus attracting a huge
number of customers. The promotional activities that are taken up by Noel Leeming are effective
in promoting the electronic appliances and home appliances, to the potential customers
("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017).
Overview of Apple store
Apple Inc. Is one of the top American multinational company that develops and sells
consumer electronic products, computers and software ("Apple (New Zealand)", 2017). The
hardware products that Apple develops and sells include the iPad tablet computer, the Mac
personal computer, iPod portable media player. Along with these, the Mac OS and the iOS
operating systems are also made and sold by Apple. The CEO of Apple is Steve Jobs. The
company is the world’s largest information technology company by revenue and the second
largest mobile phone manufacturer in the world, after Samsung. The products of Apple also
include smart watches, TVs, along with iPhones ("Apple (New Zealand)", 2017). The Apple
store is located at the Palms Mall at New Zealand. The location of the store facilitates the sale,
since the mall itself attracts a huge number of customers and those customers are also an
essential part of the Apple store. Thus, the store is facilitated by the location in the Palms mall.

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The organizational structure of Apple is one of the main contributing factors for the
organizational success and innovation. In case of Apple, the organizational structure is the
traditional hierarchy one, with a large number of intermediate hierarchies ("Apple (New
Zealand)", 2017). The leadership in the company is strong and ensures high scope of innovation.
One of the most significant features of Apple is the organizational structure of the Spoke-and
wheel hierarchy, function based grouping and product based grouping.
The retailing mix is important for Apple. A wide variety of product is available.
However, unlike Noel Leeming, a wide range of brand is not available at the Apple store. With
the effective use of the retailing mix, the choices and demands of the customers are identified,
along with the need of innovation as required to gain competitive advantage.
2. Critical evaluation:
a. Merchandise mix
Noel Leeming
Noel Leeming is one of the largest retailers of the electronics appliances of New Zealand. The
merchandise that the company offers includes computers and tablets of a variety of companies,
with wide range of brands and price ("Welcome to Noel Leeming | Technology & Appliances in
NZ", 2017). The phones and GPS that are available vary in the brands and price, thus ensuring
that the merchandise is affordable by all. Televisions and audio speakers are also available, along
with a good range and variety of cameras. Moreover, digital wearables are also available at the
store, at attractive price (Yoffie & Cusumano, 2015). The Noel Leeming also sells the home
appliances and kitchenware. The merchandise mix of Noel Leeming is important since it
highlights the demands of the customers and offers them with a wider variety of choice of the

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items, brands as well as price ranges ("Welcome to Noel Leeming | Technology & Appliances in
NZ", 2017). The merchandise mix of Noel Leeming is much wider than that of the Apple store
located at the Palms Mall. This is because, the Noel Leeming store offers a wider variety of
brands and prices to the customers, thus successfully ensuring the fulfilment of the customer
demands, as well as gain competitive advantages. The merchandise mix of Noel Leeming is
attractive and the variety enhances the customer base of the store. However, since the variety is
wide and goods of various brands are available, hence competition with the similar stores is also
high.
Apple
In case of the Apple store, the merchandise mix is wide; however, all the products are of the
same company Apple. The products of Apple that the store offers to the customers include Mac
operating system, iOS, iPad for business operations, iPod for listening to music, iPhones, smart
television as well as online support for the products of Apple ("Apple (New Zealand)", 2017).
The merchandise mix that is offered by the company includes the products of Apple and thus, as
compared to that of Noel Leeming, the merchandise mix is low. The product mix of Apple is as
follows:
Breadth- Mac, iPod, iPad, iPhone, Apple TV, software to support the products of Apple.
Line- Mac, Macbook, Macpro, iPad/2/3/air/mini, iPod/ Classis/Shuffle/Nano/touch, iPhone 3G/
3GS/4/4S/5/5C/5S/6/6 plus/7/8, iOS, OS X
The merchandise mix is low in the Apple store, since only products of Apple are available. Thus,
the potential customers are only the ones, who prefer to buy Apple products.

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b. Ownership structure
Noel Leeming
The organizational structure of Noel Leeming is a tall one. The hierarchy level is high,
along with various intermediate hierarchies. Since the company is a large one, hence the
organizational structure is a tall one and is appropriate for the organizational success. The current
CEO of Noel Leeming is Tim Edwards ("Welcome to Noel Leeming | Technology & Appliances
in NZ", 2017). The board of members are formed by the general manager commercial, Ged
Taylor, the chief financial officer, Paul Judd. He is responsible for the accounting and
transactional services. The General Manager of the marketing department is Maryanne Smith.
She is responsible for the marketing and the online promotions. Jason Bell is also another board
member, in charge of the merchandise. Garth Brown is responsible for the operations
department. The general manager of the people support and customer services is Matt William.
He is responsible for advisory, learning and development as well as the recruitment and selection
of the staffs. Sean Stephens is the general manager of the retail services ("Welcome to Noel
Leeming | Technology & Appliances in NZ", 2017). The responsibilities of the various
departments are distributed equally, such that each department could be taken care by experts,
thus ensuring efficiency of work. Thus, each of the department, namely the operations
department, accounts department, people management department, marketing department works
efficiently under the supervision of each expert. The organizational structure is appropriate for
the successful working of Noel Leeming.
Apple

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The organizational structure of Apple has a key contribution in the organizational
success. The structure of the organization creates opportunity for growth and innovation in the
business. In Apple, the organizational structure follows the traditional hierarchy, along with
some key elements that distinguishes the company from the others, and makes it the world’s
largest information technology company in the world (Heracleous, 2013). The heights of success
that the company has reached, is seen as the success of the leader and CEO Steve Jobs ("Apple
(New Zealand)", 2017). However, under the leadership of Tim Cook, few changes have been
made in the organizational structure, in order to meet the organizational demands. The unique
features of the organizational structure of Apple include the following:
1. Spoke-and-wheel hierarchy
This unique feature in the organizational structure of Apple was incorporated under the
leadership of Tim Cook. In the past, under the leadership of Steve Jobs, all decision making was
done under the supervision of the CEO. However, under Tim Cook, there is more collaboration
among the various departments such as the software team as well as the hardware team and the
vice presidents have more autonomy that earlier. Thus, the orgniaztaional structure is flexible
and follows the spoke and wheel structure, where Tim Cook is at the centre of the spoke and
wheel structure ("Apple (New Zealand)", 2017).
2. Function based grouping
The top management level of Apple has a function based grouping structure. This is
derived from the functional type of the structure of the organization. Each of the vice-presidents
handles a different business and reports to Tim Cook. For example, each of the departments,
such as industrial design, marketing and retail has a different senior vice president.

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3. Product based grouping
The lower level employees of the company have a structure of the product-based
grouping. Under each senior vice president, there are a number of vice presidents for the various
products. Thus, each of the vice presidents and senior vice-presidents are liable and answerable
for each product, ensuring better management (Pearlson, Saunders & Galletta, 2016).
Thus, the organizational structure of Apple is more organized than that of Noel Leeming. The
innovation and the leadership qualities that Apple has displayed, owes its success to the
organizational structure.
c. Location
The location of both the stores Noel Leeming and Apple is the Palms Mall. The location
of any store is important for determination of the effectiveness of the amount of sale. The Palms
Mall is a central location of New Zealand. Hence, the footfall of the people, along with variety of
the people visiting the place is large (Laudon & Laudon, 2016). Since both the stores are located
at the same place, hence both get the advantages of the large number of people coming to the
stores for buying. The location for both the stores is a major advantage in the enhancement of
business.
d. Channels
Noel Leeming
The distribution channel has a key role to play in reaching to the target customers. In case of
Noel Leeming, the company uses the distribution channel of franchise to reach their potential
customers, all over the world. The franchised stores work with equal diligence and perseverance

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as that of the retail stores ("Welcome to Noel Leeming | Technology & Appliances in NZ",
2017). Moreover, the company also sell their products directly to the customers, such that the
consumers are able to select from a wide variety of products (Parsons & Wilkinson, 2015).
Thus, the Noel Leeming store is dependent on a variety of suppliers, enhancing the supplier’s
power.
Apple
The apple stores do not encourage franchise of their products. Only authorised stores sell the
Apple products, directly to the customers. The authorised stores sell authorised products with
copyright ("Apple (New Zealand)", 2017). Thus, the company is able to reach the potential
customers directly. The customers, on the other hand can communicate directly to the company
Apple, thus engaging in effective communication. Since the distribution channel involves direct
sale to the customers, hence the dependency of the suppliers are less.
e. Pricing strategy
Noel Leeming
The pricing strategy of Noel Leeming is competitive and according to the pricing of the
other contemporary competitors. The price of all the products of Noel Leeming is same across all
the stores. Moreover, since the electronic appliances are procured directly from the
manufacturing companies, Noel Leeming gets the products at a reduced price and is able to sell
them to the customers at a reduced cost ("Welcome to Noel Leeming | Technology & Appliances
in NZ", 2017). Hence, high amount of discounts are given to the customers. The company also
uses the competitive pricing strategy. In competitive pricing strategy, the prices of the products
are set at a level, to be in competition with the other contemporary companies. The competitive

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pricing strategy is important and effective in gaining competitive advantages. The pricing
strategy taken up by the company is effective in the enhancement of the business.
Apple
In case of the Apple stores, the prices of the products are fixed and only certified retailers
are authorised to sell the products of Apple. Franchise of the products of Apple is not given to
the unauthorised dealers, in order to ensure that only genuine products are sold, with authorised
software ("Apple (New Zealand)", 2017). Apple does not use competitive pricing strategy or
price skimming. They have fixed price of the products all over the world. The pricing strategy of
Apple is directed towards attracting customers of the elite class. Thus, the people with limited
affordability are not the target customers of Apple.
3. Competitive advantages for the two retailers
Noel Leeming
The competitive advantages that the company has gained over the other competitors are
as follows:
1. High discount: Since most of the products sold by Noel Leeming are procured directly from
the manufactures, hence the store is able to give high discounts to its customers. The high
discount attracts thousands of customers, thus giving competitive advantage to the company.
2. Wide variety: A wide variety of products of various brands is available at the store of Noel
Leeming. This wide variety gives the customers a wider choice and hence the store gains
competitive advantages over the other contemporary stores.

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3. Large customer base: The store offers products of wide variety and price. Hence, the
company, with loyal customers, obtains a large customer base. This helps the Noel Leeming
store to gain competitive advantages.
4. Affordable: The wider range of the products and a variety of brands for the same products
makes the Noel Leeming store affordable for a variety of customers. Thus, fair price, high
discounts and affordability are factors that help in gaining competitive advantages.
The competitive advantage of Noel Leeming is beneficial for the enhancement in the
business as well as reaching of new customers, with their variety and affordability.
Apple
Apple is one of the largest information technology companies in the world. It has gained
competitive advantages over the other contemporary companies, due to the following:
1. Closed circle: One of the main advantages that Apple has over its competitors includes the
products and the protected ecology that the company maintains. Apple manufactures its own
software, to be compatible with its hardware. Hence, within the protected ecology, no other
company is able to penetrate. For example, no other company is licensed to produce the Mac OS
and the other software, which are compatible with the products of Apple. Thus, competition is
nullified. Moreover, a survey highlighted the fact that the iPhone owners cannot imagine to use
any other phone, thus reducing the competition and ensuring competitive advantage of Apple.
2. Brand appeal: The brand appeal of Apple among the potential customers is high and they are
attracted to the products of Apple, due to its features. The users of the products of Apple are
loyal and do not shift their choice easily (Sims & Mara, 2016). Moreover, for the users, consider

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the use of the products of Apple as pride and luxury, hence providing competitive advantage to
the company.
3. Innovation: The innovation quotients of the products of Apple are high. The innovative
features of the products of Apple ensure that they gain competitive advantages over the other
contemporary companies.
4. Customer services: The customer services that are provided by the company satisfy the needs
of the customers. Moreover, the customer services executive, thus retaining the customers, looks
into, the needs of customers diligently. The prompt customer services are effective in gaining
competitive advantages over the others.
The competitive advantage of Apple is essential for attracting more customers and
ensuring that remain in a leadership position.
Figure 1: Sale of iPhones from 2007-2016

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(Source: Khan, Alam & Alam, 2015)
4. Retailing enterprise concepts and management concepts as recommendation
Noel Leeming
The retailing enterprise concepts that are recommended for Noel Leemings are as
follows:
i. Innovation: It is recommended that innovation should be incorporated in the business of Noel
Leeming, such that the company is able to flourish faster (Pitelis & Teece, 2015).
ii. Expansion: Noel Leeming should venture in expansion in the Asian market.
The management concepts are recommended for Noel Leemings are as follows:
i. Motivation: Motivating the employees to work diligently and rewarding the employees
effectively could be recommended for Noel Leeming (Danaher, Sajtos & Danaher, 2016).
ii. Online presence: The online presence is effective and needs to be considered as a
management concept for Noel Leeming.
Apple
The retailing enterprise concepts that are recommended for Apple are as follows:
i. Franchising: The Company might consider expansion in various countries through franchisee
given to various authorised vendors.
ii. Advertisement: Enhancement in the advertisements and promotions are recommended, in
order to promote the products of Apple (Ford, 2016).

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The management concepts that are recommended for Apple are as follows:
i. Employee satisfaction: The Company needs to ensure that employee satisfaction and
employee retention is given adequate importance.
ii. Incorporating needs of the customers: The needs of the customers are to be identified and
incorporated in the products of Apple.
5. Critical evaluation of potential trade-off between responsiveness and efficiency in supply
chain management
The potential trade-off between the responsiveness and the efficiency in the supply chain
management of Noel Leeming is high. The supply chain management of Noel Leeming is
efficient. The products that are sold by Noel Leeming are directly procured from the companies
("Welcome to Noel Leeming | Technology & Appliances in NZ", 2017). Thus, with a large
number of suppliers, it is important to ensure that the products are supplied on time. Moreover,
since the company deals with electronic goods, hence it is essential that the goods delivered, are
not damaged (Hagiu, 2014). The damaged products are returned to the companies, thus ensuring
efficient supply chain management ("Welcome to Noel Leeming | Technology & Appliances in
NZ", 2017). The potential trade-off is high and the responsiveness of the company is quite
strong. The efficient supply chain management ensures that the demand for the products is met
with that of the supply of the products for the manufacturers. The potential trade-off between
responsiveness and the efficiency in the supply chain management is high and ensures the proper
working of the store of Noel Leeming. The delay in the supply chain would deflect the customers
from the store.

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