Arrow Case Study Essay
Arrow Case Study
What is Arrow’s Business Model? What value does it add for its suppliers? What value does it provide its customers?
The Arrow’s business model anchored on creating demand by helping customers “engineer end products to which suppliers’ chips were integral” (p. 5). This partnership based model between Arrow, their suppliers, and their customer was quite unique in the sense that Arrows is willing to invest resources in a customer’s project in order to create business opportunity.
The Arrow’s business model certainly adds value for its suppliers and customers through the assurance that their products are in good hands. Arrows recognizes that suppliers want their product get into the hands of the right customers, and their effort “to know our customers well enough” (p. 6) to create demands for their suppliers was an important initiative that adds value to their suppliers. The value that it provides with its customers is not in the form of bonuses but value added services through their field sales representatives (FSRs) working with them “to learn about current projects and explain and promote new products being introduced by Arrow’s supplier” (p.
7). These FSRs establishes relationship with clients, resolve problems relating to the flow of orders and deliveries, which in effect, establishes values with the customers.
How does Arrow’s sales force build its relationship with its customers? How does Express affect Arrow’s sales force?
Arrows sale’s force builds its relationship with its customers through the “value-add products as the first step to building a relationship” (p. 8). While customers are usually transactional, which means they first monitor the performance over several orders before they get in to any contract agreement to signify their commitment, customers want to do more business with their top distributor. Salsgiver explained that they build relations with their customer by giving them “a chance to interact with us, they are able to see the benefit of doing business with us rather than any other distributor” (p. 8). In other words, they build relations with the customer through establishing mutual communication.
Express affect the Arrows sales force in both positive and negative way. The positive way is that Arrow will not have the difficulty looking for customers as potential customers can just shop at the internet for distributor that can offer them good price. The negative effect is that their relations with their suppliers might be affected. In this case, the Arrow must carefully weigh its decision. However, in their analysis, it appears that Express will affect their sales force positively rather than negatively.
Do you think the internet is a friend or a foe to Arrow? In what ways can Arrow leverage the internet to facilitate its sales force?
I don’t think the internet is a friend or a foe to the Arrow but it will certainly provide advantage given the trend of business and the impact of globalization. Internet could serve as conduit for arrow and potential customers if they could establish homepages that highlights the firm and their products. It means that Arrow should consider the internet as a useful tool to promote the company and their product.
Internet is a high-tech means of advertizing regardless of how others view it. Arrow can leverage the internet by using the homepage to promote their company, provide necessary information of the products, and even sell them. They should provide direct access so potential customers can easily contact them regarding their inquiries. Currently, Arrow uses the internet only as information centers and potential customers are directed to other offices. Doing business using the internet however could surely enhance the company’s market, provide a wide pool of potential customers, and boost the sales of the company. Internet can effectively facilitate the company’s sales force through its far reaching and penetrating advertisement.
Narayandas, D. 2007) Arrow Electronics, Inc. USA: Harvard Business.