Analysing the Impact of Store Locations for Increasing Sales in Courier Industry In UK – A Case Study Of UPS
Couriers are one of the most important services now a day. It is basically a service by which people send money or goods at extra cost. The impact of location for the business is a vital issue. As mentioned by Adjei et al. (2010), the mangers need to take decisions to select the proper location of the business. The location can have a significant impact on the performance of the business. Appropriate location can attract more number of customers. The frequent visits of the customers depend on the suitable location. However, in this context, Griffin and Babin (2009) argued that the importance of location in modern days is not that much relevant as the customers are preferring online marketing. The operation of courier services is quite different than that of the normal products or services. In case of the courier service the scope of placing order is quite limited. Therefore, the relevancy of online marketing in the courier service is very little. This factor has increased the importance of choosing proper store location to increase the sales. According to the view of Li et al. (2011), the failure and success of a business depends on choosing the proper location.
In order to increase the revenues an organization need to create values and brand loyalty among the customers. Therefore, by selecting the convenient store locations an organization can attract more customers. In this research the researcher has selected the case study of UPS, UK to evaluate the impact of store location to increase the sales.
The courier companies like UPS faced problems to attract customers due to the proper store location. The stores are usually located in a remote place and do not have the accessibility of good transport and communication. Due to the proper parking area and distance from the competitors less number of customers visits to the stores. As a consequence the sales of the company have reduced. Moreover, as mentioned by Nambisan and Watt (2011), the existing store location has problems like proper signage, proper lighting in the environment and the provision for sanitation of for the customers.
Why is it an issue?
Inconvenient store location does not allow the customers to visit to the stores. As mentioned by Pookulangara and Koesler (2011), the retail stores like UPS find it very difficult to maintain sales in the highly competitive market. Moreover, due to the proper store location, customers find it very difficult to locate stores for packing delivery and selecting a competitor brand.
Why is it an issue now?
The UK courier industry is highly competitive. Therefore, the companies prepare strategies in order to retain the customers. The customers select companies that apart from providing services also have the facility like car parking, security and proper sanitation. Therefore, UPS may find it very difficult to cope up with competitors like Fedex, DHL etc. Therefore, the existing customers may switch from one company to the other one that can offer the easy location and the above mentioned facilities. The declination of the customer loyalty and sales may affect the profitability of the company.
How will the research benefit future development?
In this research, the researcher will analyze the problems faced by UPS due to selecting the proper store location. The researcher will carry out online questionnaire distribution to the customers. The perceptions of the customers regarding the location are obtained. At the same time, the researcher will conduct interview with the mangers of UPS. It will help the company to explore research that will reveal the marketing strategies to open new sores in the different locations. The findings of the research will help the mangers to understand the customer related problem and accordingly redesigning the existing marketing strategies.
The study will focus the importance of selecting proper store location to attract more customers and increase the revenues for the courier companies. With the example of UPS, UK the researcher will analyze the topic.
- To examine the factors that affects the buying behaviour of the customers.
- To analyze the importance of store location for the courier companies.
- To evaluate the performance of UPS, UK in the context of current issue.
The researcher has selected the following questions for the current study:
- What are the factors that impacts on the consumer buoying behaviour.
- How does the store location affect on the sales of the company.
- How does the store location impact on the current performance of UPS, UK.
Companies need to attract more customers in order to cope up with the stiff competition. As mentioned by Brown et al. (2003), one of the most important issue of the mangers are to judge the factors that can affect the consumer buying behaviour. Based on the factors the mangers prepare the strategies that help companies to attract the customers. On the other hand, Cronin and Taylor (2012) stated that the companies need to provide the values rather than just offering the products and services. One of the most important aspects of attracting more consumers is to provide the appropriate store location. As stated by Czepiel (2009), the proper location of the stores help the customers to have the repeated visits to the stores. Therefore, the sales will increase. The features that help to address more customers can be used by the companies while preparing the marketing strategies.
2.2 The impact of location to improve the courier business:
The business need to aim the locations that will provide the maximum competitive advantages. As stated by Gagliano and Hathcote (2004), by selecting the best location a business can get more customers. One of the most important aspects of the multinational business is to create brand loyalty. In order to create the brand loyalty among the customers the companies need to provide the values to the customers. Proper location is one of the most important values.
Courier business market is highly competitive. The number courier companies are operating in UK. As mentioned by Mitchell (2009), each of the companies want to outperform the other one in order to have competitive advantage. Service is considered as a core element that provides the values to the customers. Service is considered as one of the vital driver and differentiator of the business (Mittal and Lassar, 2006). As a part of the strategy, the courier companies seek the proper location to attract more number of customers. The companies like Fed Ex has store locations in the areas that can provide facilities like car parking, proper sanitation etc.
The companies consider many issues before opening a new branch or relocate the branches. The courier business generally cannot be operated through online. Therefore, the customers depend only on the stores. As mentioned by Svensson (2006), the companies need to open new branches in the city location where they have no existence. A business may need to restructure or modernise the operations. The company can do this by bringing together some of the existing departments into new purpose built premises. On the other hand, the company may decide to close some of its stores that is not providing proper revenue. As mentioned by Wong and Amrik (2003), by operating the business in the locations that is not fetching revenue may increase the operational costs for the company.
A courier business needs to consider many factors before taking any decision of opening new stores. The factors may are as follows:
- A) First of all the company may select the site with the cheapest price.
- B) It may select the location that is convenient for the employees to come. Moreover, the companies also need to consider the stores in a location where the customers can easily come. The proper transpiration is also very much important in this context.
- C) Moreover, the companies select proper location that will help the employees to carry the goods.
As mentioned by Zeithaml et al. (2006), in case of the courier companies, delivery time is one of the most important parameter. Any delay in the delivery time may create problems to the customers. Therefore, it will reduce the customer loyalty. A proper location will help the employees to provide quick services to the customers.
By locating the branches in the busy areas will also help to create the awareness. The courier companies can increase the awareness of the services by using the premises to project a strong brand. Moreover, as mentioned by Cadogan (2009), the companies need to be opened enough to the changing customer demand. Moreover, the organization needs to take risks before investing. Selecting a new location includes a huge amount of investment. Therefore, the company need to seek the proper location that can attract more customers and increase sales for the company. As mentioned by Ferrell and Hartline (2005), the new store location includes proper location:
- Set up costs: The companies need to procure additional cost to buy new locations.
- Fixed cost: The fixed cost includes the house rent, cost of electricity etc.
- Variable cost: As the companies expand the operation, the cost of employee and the vehicles will increase.
Therefore, an organization needs to project the sales before opening any new branches. The courier companies may sometime take a location to offer a strategic advantage. As stated by Mooradian et al. (2012), by selecting the location, a company can stop the competitor to have the access of the market.
The courier company need to identify the store location. The location need to have the facilities like proper parking area, sanitation, transportation etc. It can be done by proper market research. As mentioned by Schneider and White (2004), the courier company need to judge the customer demography before selecting the location. The location need to be at the central place of the city so that it can draw the attention of the customers and moreover, the customers can easily come to the office and post the materials. In this context, as mentioned by Wilson and Gilligan (2005), the courier company need to judge the choice of the customers in case of the courier service rather that the normal post is very much important. The courier service includes additional costs, therefore, he companies need to do the proper research on whether the customers are economically strong enough to bear the additional costs.
UPS, UK has been facing a very stiff competition in the UK market. The companies like Fed Ex, DHL are taking much of the market share. The reasons can be the above mentioned companies are offering better services. Moreover, in this context Wilson and Gilligan (2005) mentioned that in order to attract new customers a company need to provide additional values to the customers. It has been seen that in the recent few years the sales have declined at a faster rate for UPS. Mitchell (2009) stated that the main reason of that may be UPS has selected the locations that are not convenient for the customers. Therefore, the number of customers has switched to the other companies. It has reduced the sales for UPS.
Selection of appropriate research methodologies is crucial to the success of a research work and that the accuracy of the research outcomes is determined by the methodologies chosen for a concerned research work. This section briefs on the research methodologies adapted for the current study.
The researcher would follow positivism philosophy and deductive approach for the current study. As regard to the research design, the current study would be based on exploratory research design. As mentioned by Youngdahl et al. (2006), research philosophy, research design, and research approach provide a complete guideline and structure to the entire research work. Positivism philosophy is considered suitable for researches that are scientific in nature. On the other hand, deductive research approach is followed in studies that are aimed at examination of existing theories against the research hypothesis. Exploratory research design helps in the examination and evaluation of current views, beliefs, theories, and ideas (Teddlie and Yu, 2010). Therefore, positivism philosophy would enable the researcher to properly justify research outcomes through scientific evidences and logical explanation. Deductive approach would allow the researcher to test existing principles and practices related to the impact of store locations on the sales revenues of UPS plc. Exploratory design would allow the researcher to explore new ideas and thoughts regarding the impact of sore locations on the sales revenues of a courier company.
Data are classified into primary and secondary data. Primary data refers to the opinions and feedback collected from respondents whereas secondary data are the historic facts, figures, and data available through secondary sources. In this context, Hammond (2009) stated that primary data is useful to examine current situation whereas secondary is helpful in studying past situation. The current study would be based on primary data only. The researcher would collect both quantitative and qualitative primary data. Required data would be collected directly from customers and managers of UPS plc.
The researcher would collect quantitative data from 50 customers. Survey questionnaire would be used to collect feedback of the customers. The researcher would use likert scale in the survey questionnaire. As mentioned by Morgan (2011), quantitative data enhances quality of research outcomes by focusing on objectivity. Non-probability convenience sampling process would be used for the quantitative data analysis. On the other hand, qualitative data would be collected from 3 managers of UPS plc. The researcher would take prior appointment of the concerned managers for the interview sessions. The response from the 3 managers would provide subjective view on the impact of store location on the sales revenue of the company. The researcher would use purposive sampling method for the qualitative data analysis.
In the view of Hammond (2009), accessibility is one of the prime concern in respect of research studies. Restriction on accessibility to the required data often hinders the progress of the research work and the research outcomes are also adversely affected. The researcher would take approval from the administration department of UPS plc to conduct interview sessions with the managers. In addition, permission from respective managers would be taken beforehand to ensure that managers are available for the interview sessions. As regard to the survey questionnaire for customers, the researcher would send the questionnaire to the personal email IDs of the customers.
It is important for a researcher to identify the ethical issues associated with research work. As mentioned by Youngdahl et al. (2006), a researcher needs to ensure that primary data collected for a particular research work are used for that particular research only. Hence, the researcher would ensure complete confidentiality of the data collected for the study. In addition, the researcher would also ensure that the questions set for the data collection do not hurt the sentiments of the customers and managers.
The research can highlight the factors that can affect the buying behaviour of the customers. Moreover, the importance of selecting proper location to increase the sales will be analyzed in the research work. The performance of UPS, UK in the context of current issue will be discussed in the research work.
The overall aims and objectives of the research have been presented in this research. For developing the research methodology a brief literature review has also been presented in this research work.
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