Hands-On Glove Makers - Company Essay Example
As I a communication consultant I will right a report regarding Hands-On Glove Makers proposition ,if creating a website will be more beneficial to them than not or if expanding in another way is better
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Hands-On Glove Makers is a retails company wanting to know whether to sell on the online market. In this report I look at the positives and negatives. I look at the competition they will face from globally competitors. Laws which will also affect Hands-On Glove Makers such as data protection act to protect customers and sensitive data from viruses and hacker. The consumer protection act in which they must ensure they follow as to protect the customer and the company. The report also looks at the benefits of the online store rather than expanding by creating another store. I conclude with going online is the most beneficial because it is the easiest, most price effective and best suited to Hands-On Glove Makers.
Hands-On Glove Makers is a retail company which is based in Watford. Over time the reputation has increased through word of mouth. Orders are being taken through telephone or in their premises. They are know considering to began to sell online and I will analyse the idea of selling online for Hands-On Glove Makers.
If Hands on Glove Makers are to go online the must ensure they will be able to compete with the already present online market. One main leader in the online market is direct golf they manage to sell their products for as little as ï¿½4.99 to ï¿½14.99 and therefore Hands on Glove Makers must see weather they will be able to offer a similar price to what the other companies are offering. Direct golf have certain products that are loss leader however know their other products sold will cover for these loss leader. This is price method which Hands-On Glove Makers may need to adopt if they go online in order to attract customers from the other retail stores.
If Hand-On Glove Makers go online they must be aware of the legislation in place. On legislation which they must be aware is the Data Protection Act 1998 this will regulate how they deal with their customer personal information. If records are kept of the sales transaction then you must follow certain principles. Firstly you must inform the customers that the details will be kept and allow them access to their data if they ask for it, and inform the Data Protection Commissioner. However by keeping the information and following the Data Protection act you can find out buying trends and find out clearer market segmentation.
A second regulation that will know affect Hand-On Glove Makers more is the consumer protection (distant selling) regulation. This will mean Hand-On Glove Makers are required to give information on the website. information such as company name , accurate description of products and must have a “cooling of period”(businesslink.gov.uk) as to allow for customer to cancel their purchase if they wish. These laws are there in order to protect customers and companies.
One benefit to Hand-On Glove Maker is the operational costs are much lower in than it would be if they decided to make another store elsewhere. By creating online you do not need to rent a high street premise. You could merely do it in the factory or in the store that you have. By going online rather than creating another store you also have lower costs due to less money goes on paying employees. However, for the website it may be appropriate to higher someone in order for them to create, monitor and update the website. This person will have specialist skills for the website and therefore will be more appropriate for creating the website that having someone currently in the job to create who may not have the skills.
By going online the customers order can go directly to the data base from the website. This will make it easier for employees to analyse the data as they will have the most up to date information. By having the data go straight in you can get an overview of who are your target market and market trends. One example would be with golf direct whom with the data found that advertising would be needed 43 times a year because the customers were extremely loyal (http://www.golfworld-direct.com/realtors.html) .By going online Hands-On Glove Makers can find out their target market and see what type of customers they have. From the data base created you can improve your offers by tracking the customer purchases and therefore can see which product sell the most.
By going online Hands-On Glove Makers increase their potential target market audience. By going online you can attract a customer form anywhere in the world. By competing in a global market you have increased you sales opportunity. However by going online you must be aware that will mean you have more competition than when you were a retail store. Although being world wide means their will be more competition for you to compete against the increase in you sale opportunity out weighs this. (http://youonline.com.au/7reasons.asp). You can increase you sale in many ways by creating a data base of previous customers, emailing them of recent promotion, you are open 24 hours a day 7 days a week. ( http://youonline.com.au/7reasons.asp) Being open all the time can cause an attraction of customers who are not customer of you high street outlet. Advertising cost will be limited as it can be done online
A website can also help with the retail store in Watford. Customer who are want to buy from the company however are wary of the internet they could visit the store and therefore increasing sales. Also people within the local area may be unaware of the store being so local to them and website can act as a mean of getting customer to visit the store. Although the website may bring awareness to customer about the store it must be monitored and secure procedures must be placed to reduce the amount of viruses the system may have. in the graph(http://www.thefloatingfrog.co.uk/tag/microsoft) we can see how quickly a virus can spread , this virus damaged all links on the website and corrupting files. The speed of the virus was phenomenal and Hands-On Glove Makers must be aware and may need to buy safety software but will need to continuously update the safety software as the more up to date the protection software the more protected you are from viruses. As over a thousand new viruses are sent daily (wiki.answers.com/…/How_many_new_computer_viruses_are_made_every_day -). However the problems faced from the viruses are universal and all companies will have to have security procedure and therefore are easily over come.
However creating a website is not all positives, creating a website for Hands-On Glove Makers may be difficult because the need to measure and the fitting needed for the gloves. It could be possible to have customers measure themselves and enter the size they need however this may then lead to an increase to the amount of returns.
In order for Hands-On Glove Makers to compete online the must keep their prices lower and must also realise the extra costs that are their when becoming a website such as are the customer going to pay the delivery cost fee. If yes will you still be able to compete with the other online stores, who may be running certain product at loss leader in order to survive. Hands-On Glove Maker must first begin to compete for the UK customers and this will increase their market share once they have a steady flow of income from the website they can begin competing globally
Going online isn’t always beneficial because the ever increasing threat of online fraud. In the graph below we see that the amount of phishing has increase and has become and extreme worry too many. ( http://www.net-security.org/secworld.php?id=7963) This increase in fraud has lead to more people fearing to use the credit card online. Therefore it may be more appropriate for Hand-On Glove Makers to use secure payment methods such as PayPal’s. The fear of fraud is high, but it still hasn’t stopped the online market growing
Hands-On Glove Makers would benefit more from going online. By not going online and staying the same the company will not gain anything, by venturing to the online market you gain a substantial more. Going online we allow for Hands-On Glove Makers to increase their potential sales and increase their market penetration. However to do so Hands-On Glove Makers must abide by the laws and be aware of all the possible negatives that may affect them and plan on how to reduce the effect of the negatives such as by having secure internet pay system will reduce the amount of customers who may complain or not order. In to survive in the market they should expand and the best way to do this is by an e commerce venture. The decision to make a website is big however does not mean automatic success. Making a website will not be a success unless the web site is easy to use and the domain name is one easy to remember. It may be necessary for the company to pay search engines in order for the company to website to come at the top of the page under the sponsored link. Even with the negatives the benefit outweighs them and therefore the E commerce venture should go ahead.
This first graph is the CSV virus taking place on the 22 of February 2009 the virus was leaked in the morning and by 9.00am over 10 million different online companies were hit. The virus changed links and corrupted different files. Even major companies such as London exchange.
This second graph shows the increase in phishing over the year it shows how high it is and how phishing is only growing over the months and doesn’t seem likely to decrease anytime soon. This means Hands-On Glove Makers must aware of and try and protect them.