Easyinternetcafe Case Study

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Table of Contents

Executive Summary        1

Issue Identification        2

Too many PCs, no profit – short term        2

Poor Strategy        2

Environmental and Root Cause Analysis        3

Qualitative and Quantitative Analysis        3

Alternatives and Options        4

1.        Utilize UPS services but have a UPS warehouse dedicated to EIC        4

2.        Use GlobalServe with one centralized warehouse        4

3.        Use Ingram Micro with the option of VARs        5

Recommendations        6

Implementation        8

Monitor and Control        9

Conclusion        10

Exhibits        11

Exhibit 1: SWOT Analysis        11

Exhibit 2: Implementation Timeline        11

Exhibit 3: Balanced Scorecard        12

Executive Summary

easyInternetCafe (EIC) was started by Stelios Haji-Ionannou in UK as part of the easyGroup during the dotcom revolution. The company launched with the idea of giving individuals the opportunity to access the internet in a low-cost manner at an internet cafe however they were not very profitable and there was also not much demand. They needed to restructure their operations so as to outsource their supply chain activities and focus on their core competencies of keeping their operations “easy” and concentrating on yield management – providing high quality and low cost. EIC has decided to downsize by operating smaller franchise stores with 20-30 PCs and only maintenance staff however with the current logistics, the lead times are very long and they are also spending approximately 1300 GBP just to open a new store and annually around 270,000 GBP in total not including outbound transportation costs.

My decision is for EIC to partner with Ingram Micro, a company specialized in integrated supply chain functions who can take over EIC’s transportation, warehousing, procurement, logistics and financing operations. This will give EIC a better handle on how they should be operating their business and this will also result in cost savings. The choice to go with Ingram will only cost £179 per store coming to £37,232 for 208 stores and the staff costs with labor would be £560. There will also be Value Added Resellers available in each region where a franchise is located just to help the franchisee with their set-up and providing any spare parts as may be needed and help with troubleshooting as needed so that the franchisees receive quality service.