MMW2265/22/23A Innovation and Global Marketing Logistics
MMW2265/22/23A Innovation and Global Marketing Logistics
Introduction
In this report, the role of logistics in the development of business will be evaluated based on the value proposition of the product or service and it may help in delivering the product or service to consumers. The report has also focused on the sourcing as well as distribution strategy to boost the level of operation and identify different issues associated with logistical operation positively in the formulation of a better strategy to cope with the current issues. In addition to that, the report will provide a great scope to evaluate sustainable strategies associated with sourcing and logistics policy and the application of these policies positively reflects on innovation.
Analysing the sourcing and distribution strategy for the business idea of digital shoe product from logistical perspectives
Sourcing strategy
Sourcing strategy plays a crucial role in logistics as it helps in paying attention to different steps associated with sourcing and different types of sourcing facilitate the overall operation. In the case of launching digital shoes, strategies associated with sourcing are highly essential and following a multi-sourcing strategy may positively reflect on the business or escalating innovation. From the article, it has been noted that increasing globalisation, financial integration, interdependence and other factors escalate uncertainties within both supply and demand in the uncertain, complex, business scenario (Wu et al., 2019). For this reason, following a multi-sourcing strategy is highly essential to manage the uncertainty within supply and demand based on different sources by addressing different types of challenges. In the case sourcing, there are different types of sourcing such as human resources, technology, fund sourcing and others for launching digital shoes based on modern technologies in an effective manner. The managers within the company need to pay attention to sustainable sourcing in the case of human resources and following zero tolerance policy positively reflects on the growth of the company. Considering the article, it has been noted that the application of multiple sourcing networks positively facilitates stakeholders of the company, by increasing flexibility and decreasing dependency (Azad and Hassini, 2019).
The application of resource dependence theory positively impacts sourcing strategy and the theory explains the way organisational behaviour is influenced by external resources. Considering the article, it has been noted that resource dependency theory has helped in paying attention to access to goods, raw materials, services, finance and knowledge to bring survival success (Ncbi.nlm.nih.gov, 2024). Additionally, following the resource dependency theory aids in managing the resources that are required for the production of digital shoes as well as increasing control over the supply of resources. In this case, technological sourcing is highly essential and depending on only one supplier may affect the production rate while following the multi-sourcing strategy ensures a better pace within the production or inventory management. According to the article, it has been noted that in the case of technologies associated with Information Technology (IT), a multi-sourcing strategy is well-accepted by different organisations (Bapna et al., 2023). There are four parts of sourcing strategy such as spend analysis, sourcing, contract management, supplier management and strategic sourcing skills of the organisation help in taking competitive advantages. From the article, it has been noted that the application of the Internet of Things in recent times has exacerbated the scope of maintaining transparency within logistics activities (Mohammed et al., 2022).
On a particular note, modern technologies have aided a company in doing the spending analysis which is highly essential for launching any product or service as budget assessment is highly important for launching the digital shoe in the market of the UK. Radell and Schannon, (2019) mentioned in the article that digital procurement creates an opportunity to boost efficiency and it also pays the way of accelerating innovation based on effective sourcing. In recent times managing suppliers has become a great challenge for any organisation and the application of stakeholder management theory and any aid in boosting the relationship with stakeholders such as suppliers. It has been argued that gaps within the sourcing strategy may stem from conflict with different employees, suppliers, consumers and other stakeholders while following ethics is crucial for desirable operation. From the article, it has been recognised that robot process automation is the primary stage of rapid change within operation and it positively aids in resource planning (Hartley and Sawaya, 2019).
In the management of the company skills such as communication, problem-solving, decision-making and many more are highly essential for effective sourcing and digital technologies aid in bringing rapid transformation. It has been noted that some challenges are associated with sourcing such as supply chain disruptions. Barriers of language, gaps with proper strategy to access, gaps within compliance management and many more may effectively impact the sourcing strategy.
Distribution Strategy
Distribution strategy is also part of the logistical strategy of a company and it helps in distributing products to consumers following distribution channels such as online as well as offline. In the contemporary scenario, there are different types of distribution strategies such as direct distribution, indirect distribution, intensive distribution, exclusive distribution and selective distribution. The company may opt for a selective distribution channel to choose more than one retailer to distribute the product which is a digital shoe based on modern technologies such as GPS, AI and others. Based on the article, it has been noted that selective distribution is most appropriate for selling goods on a large scale and a selective distribution system aids in ensuring brand image based on vertical agreement (Materljan and Materljan, 2019). In the UK market, for launching digital shoes, selective distribution may be appropriate as a selective distribution strategy may help the company get the conveniences of both intensive as well as exclusive distribution processes. Considering the article, it has been noted that the distribution strategy reflects on the brand’s service which aids in maintaining brand equity and distribution service is one of the central elements of the company (Tien et al., 2019).
In the case of the distribution strategy some factors need to be considered before launching digital shoes in the market of the UK and those strategies include product characteristics, market and customer characteristics and others. In addition to that, characteristics of the middleman, characteristics as well as objectives of the company and evaluation of the characteristics of competitors are highly essential. On the other hand, following the 8R model of logistics may also help boost the distribution strategy and it includes the right product, right quantity, right condition, right place, right price, right customer and many more. According to the article, it has been noted that the growing global population has created a real challenge for different companies and it fuels the demand in the international range which may cause a negative impact on production (Wang et al., 2019). In the age of digitalisation, integration of both online as well as offline distribution channels may help in meeting the demand of consumers in the UK market and take competitive advantages. From the article, it has been opined that the application of a sustainable distribution model helps in reducing transportation costs, minimising carbon emissions, and many more (Vafaei et al., 2020).
Apart from that, there are two types of flows such as information flow as well as material flow through different distribution channels and the adoption of digital technologies brings flexibility within information flow. The company may adopt big data analytics to manage a vast range of data in inventory and logistics management which includes freight consolidation, freight distribution, shipment planning, traffic management, inventory management and others. On the other hand, the flow of information may be included in customer services such as freight payments, auditing, order management, fulfilment, and many more while communication supports getting information from suppliers. According to the article, it has been opined that communication through social media platforms with consumers positively reflects on boosting the service associated with supply chain activities (Zhou et al., 2022). It has been argued that gaps within the distribution channel may impact the operation of the company and lack of technological implementation may impact the capability of the company to evaluate demand as well as supply. The distribution and sourcing strategies are interconnected to each other and launching digital shoes in the UK market may positively influence the ability to take long-term competitive advantages.
Contemporary issues in global marketing regarding ethical and sustainable behaviour in logistical strategy
The strategy of logistics may be defined as the process of flow of goods and services across the supply chain through dedicated transport networks in the form of inbound and outbound logistics, which helps to get quick delivery of raw materials and resources within the supply chain along with the delivery of readymade materials to the customers. Thus the company associated with launching digital shoes may face certain issues in logistical strategy in the UK market, related to sustainability and ethics, which may further impact upon sourcing and distribution of products. However, the main issues in the implementation of the logistical strategy include damage to goods, delays in orders and multiple data entries which impact sourcing and distribution as well (Tijan et al., 2019). It has been identified that the company currently operates within the market UK where it focuses upon the production of digital shoes to stand against the competitors of Adidas and Nike. Certain ethical issues in the adoption of logistical strategy may be forced labour, unfair wages and intense working conditions, which may negatively impact upon sourcing and distribution of materials. Thus the identified ethical issues of incapability of providing sufficient wages and salaries to the labourers and employees who will be engaged in inventory management and driving of transport may go on strikes and as a result, delays may be observed in sourcing raw materials from the suppliers and readymade products in the form of digital shoes may not be created. However, the usage of technologies such as Blockchain may help to create ethical logistics activities and transportation networks across supply chains (Koh et al., 2020). Certain geopolitical and environmental disruptions may create issues in logistics strategy related to sourcing and distribution in terms of cross-border transportation of finished goods. COVID-19 is considered to be an important issue, which has been recognised as an environmental disruption as well as negatively impacting the financial performance of logistics providers due to restrictions in transportation to control the virus (Atayah et al., 2022). Thus a similar environmental disruption may arise which will create strict lockdowns and certain cross-border restrictions in the transportation of raw materials from one country to another and as a result, sourcing of resources may not be done timely causing irregularity in sourcing and delays in delivery of finished products, digital shoes as well. Certain geopolitical tensions between two countries may create bans and restrictions on goods and services from one country to another, and as a result, restrictions may be observed in the transportation of goods as well. It may negatively impact upon sourcing of raw materials and distribution and last-mile delivery of goods to the consumers. The recent Russia-Ukraine war negatively impacted the global supply chain networks causing a negative impact on logistics mainly in terms of transportation costs due to an increase in fuel prices (Toygar and Yildirim, 2023). Thus the increase in transportation expenses may create issues to manage the budget for the company to produce digital shoes and most of the investment may be done in sourcing and distribution of logistics. It has been identified that the Six Sigma programme has been quite successful in generating a positive impact on the operations of logistics which further relies upon total quality management (Trott, 2008) The ongoing Gaza Palestine created serious tension among the Gulf countries along with the middle east countries which similarly created increase in the fuel prices impacting upon logistical strategy. Certain sustainability issues may include environmental problems such as the release of greenhouse emissions from different modes of transportation, thus adaptation of green transportation may be included as a logistical strategy. Sustainability issues related to carbon emissions, lack of observation of environmental regulations and managing it may be observed within logistics service (Lee et al., 2019). Lack of transparency with suppliers may create irregular sourcing of materials and similarly, irregularity in payments with the suppliers may impact relationships and as a result, goods may not be sourced despite dedicated transportation in logistics. Certain issues in the form of a lack of tracking and tracing of sourced raw materials and delivered goods may create damage to the resources along with finished goods. Certain delays in transportation may be observed as the preferred route may not be suitable for the transportation of goods which impacts upon rerouting of transportation causing wastages of fuel and other related expenses such as toll tax and other road duties.
Analysing the sustainable, responsible solutions and policies for logistical strategy in terms of sourcing and distribution
The mentioned company while producing digital shoes in the UK market may face certain issues in logistical strategy thus the company should adopt certain solutions to mitigate it to some extent. Adaptation of alternative fuel needs such as green energy needs to be done by the company to avoid irregular expenses in fuel from which sustainability issues may be avoided to some extent. The company should have sufficient infrastructure for buying electric vehicles along with dedicated charging stations, which will perform the operations of sourcing, distribution and last-mile delivery of goods at low expenses and without harming the environment. Using renewable energy for business activities in electricity generation leads to environmental preservation in terms of eliminating greenhouse gas emissions and supports the business to create the most sustainable business globally (Maradin, 2021). On the other hand, technologies that may be actively implemented related to the prediction of the planned routes from any upcoming disturbances within the routes may be identified to change the planned routes. It may help to reduce expenses and avoid wastage in fueling transportation to some extent.
A critical challenge that the digital shoe production company in the UK may face is the labour shortage due to ineffective unfair wages and salaries which may impact the sourcing and distribution of the products. Therefore, effective salaries and wages should be offered to the staff who may support Research and Development (R&D) and business activities of the shoe industry and develop new shoe designs through sustainable sourcing of raw materials and adding great business values (Chang, 2022). This article also stated that the shoe industry will be more labour-intensive after 20 years, which will indicate that the shoe industry has to shift to a place where cheaper labour will be easily available. Apart from that, another logistics challenge of delaying delivery of the raw materials of digital shoes has to be minimised through adopting the dual sourcing strategy, the reason for dual sourcing strategy is to reduce dependency on one supplier. The reason for dual sourcing within the company helps influence the capacity of the suppliers for different components for achieving the objective of maintaining the stability of the supply pool and making effective decisions to create better results (Xu et al., 2023).
The Ukraine-Russia war may create a negative impact on the performance of the business in the production of digital shoes by delaying the delivery of raw materials and the distribution of the products to the customers. The workforce has to be improved more to balance these difficulties with proper motivation and that will be possible when digital shoe companies in the UK offer a significant amount of wages or salaries with health benefits. The importance of work motivation in logistic activities has to be improved by applying Herzberg’s motivation-hygiene theory or the dual theory, consisting of motivators that lead to job satisfaction by offering the employees motivation. In the context of this theory, the motivator factors come from intrinsic feelings that create learning opportunities in the form of achievement, recognition and growth which will give positive outcomes (Peramatzis and Galanakis, 2022). This company should improve the transport infrastructure along with sufficient investment and complete structural reform that has to be delivered through managing the effective relationship with the suppliers.
Digital shoe companies in the UK have to follow the human rights principles for the suppliers and employees that may manage the issues of lacking transparency with suppliers and support in sourcing ethically. The company will continuously produce sustainable results by investing more in cultural training awareness to continuously improve the employability skills of the labourers even in post-pandemic. As the effect of these sustainable policies, the company will achieve long-term success through focusing on innovation for sustainability.
Conclusion
From the above report, it has been identified the essentiality of sourcing strategy which further facilitates overall operations within the supply chains and similarly active usage of modern technologies along with the human resources may be sourced to launch digital shoes by the company within the market of UK. On the other hand, attention needed to be paid by the managers to promote sustainable sourcing within the supply chain, along with performing operations of distribution, which have been included as a part of the distribution strategy. Modern technologies such as AI and RFID enabled GPS which help to improve distribution strategy in logistics by choosing a preferred distribution channel.
In the contemporary era, the issues associated with distribution and sourcing strategy as part of the logical operation are unethical behaviour towards labourers and it impacts the overall productivity. Other issues include the sudden outbreak of the pandemic Covid-19, geopolitical tensions such as the war between Russia, and Ukraine, uncertain economic conditions and many more which impact the sourcing as well as distribution strategies of different companies. The recommendations against the identified issues may help in overcoming challenges and help the company launch digital shoes in the UK market by following effective strategies.
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