Logistic services as competitive means : segmenting the retail market for softwood lumber

Abstract

The structure and development of Russia's food retail sector from the point of view of Finnish food industry

Tämän diplomityön tavoitteena on selvittää Venäjän ruoan vähittäiskaupan rakenne ja sen tuleva kehitys. Tällä hetkellä se on yksi maailman nopeimmin kasvavista markkinoista. Kasvun syynä on korkea öljyn hinta, jokaon kumuloitunut ihmisten palkkoihin. Kuitenkin vaikka tulot kasvavat, ruokaan käytetty osuus tuloista on pysynyt suhteellisen vakaana. Kulutus on siis siirtymässä laadukkaampiin ja arvokkaampiin tuotteisiin Modernien kauppojen osuus markkinoista on vielä pieni, koska Venäjän vähittäiskauppasektori on yhä hajaantunut perinteisiin kauppaformaatteihin kuten kioskeihin, toreille ja pieniin ruokakauppoihin. Kauppaketjut ovat kuitenkin tulossa merkittävämmiksi. Suurin markkina-alue vähittäiskauppiaille on Moskova, mutta tällä hetkellä ketjut laajentavat toimintojaan nopeasti myös muille Venäjän alueille. Parhaat kasvunäkymät ovat alueilla, vaikka Moskovan markkinat eivät olekaan kyllästyneet. Tärkein kasvua rajoittava tekijä Moskovassa on rakennustonttien ja kiinteistöjen saatavuus. Vähittäiskauppamarkkinat lähestyvät kyllästymispistettä, josta seuraa markkinoiden konsolidaatio. Tämä prosessi on jo alkanut, mutta kovin paljon yritysostoja ei ole vielätehty. Toistaiseksi kauppaketjut ovat tyytyneet muodostamaan alliansseja. Ketjut pyrkivät parantamaan asemaansa hintaneuvotteluissa muodostamalla osto-alliansseja, luomalla omia brändejä ja käyttämällä alueellista laajentumista lyömäaseena. Jotta ruoan tuottaja pääsisi myös alueellisille markkinoille, on sen ehkä suostuttava myymään tuotteitaan edullisempaan hintaan. Tavarantoimittajat ovat vahvassa asemassa silloin, kun heillä on toimiva jakeluverkko, kyky JIT-toimituksiin,kunnollinen dokumentaatiokäytäntö, vahva brändi ja edullinen hinta. Ns. listausmaksun suuruus voi määrittää tuottajan tuotteilleen saaman hyllytilan koon.

Scandinavian companies of banking, retailing and hotel sectors investing into the Baltic States-developing service sector

Diplomityö tehtiin Lappeenrannan yliopistossa päätavoitteenaan selvittää tärkeimmät motiivit, jotka ovat saaneet pohjoismaiset palvelualan yrityksetinvestoimaan Baltian maiden kehittyvillä markkinoilla. Pohjoismaiset yritykset ovat olleet aiemmin aktiivisia hyödyntämään Baltian maiden työvoimaa tuotantosektorilla. Suomalaiset yritykset ovat investoineet aiemmin telekommunikaatio- sekävaatetussektoreihin, mutta nykyisin investointien pääpaino on siirtynyt palvelualalle. Pankkisektori on erittäin kehittynyt pohjoismaissa ja ruotsalaiset yritykset ovat onnistuneet myös Baltiassa siirtyen markkinoille yksityistämisen tuomien mahdollisuuksien avulla. Nykyisin näillä yrityksillä on vahva jalansija Virossa sekä ovat etabloituneet myös Latviaan ja Liettuaan. Suomalaiset pankkialan yritykset ovat olleet vaatimattomampia tällä sektorilla. Vähittäiskauppiaat ovat vasta kansainvälistymisprosessinsa alkutaipaleella. Suomalaiset yritykset ovat laajentuneet Viroon ja tehneet yhteistyötä ruotsalaisten yritysten kanssa. Hotellisektorilla suomalaiset ja ruotsalaiset ovat edenneet rauhallisesti, mutta norjalainen ketju, Reval Hotel, on laajentunut kaikkiin Baltian maihin. Hotellisektorilla on luvassa kasvua lähivuosina. Kilpailutilanne on kiristynyt kaikilla palvelualan sektoreilla sekä paikallisten yritysten kasvun että ulkomaisten investoijien myötä. Elinolojen paraneminen vaikuttaa myös kilpailutilanteeseen kiristävästi, sillä se luo mahdollisuuksia yrityksille laajentua. Tämä diplomityö selvittäätilannetta valittujen yritysten kannalta niiden kansainvälistymisen alkutaipaleella.

Russia's food retail sector from the point of view of Finnish food producers

This research paper focuses on the Russian food retail sector and its structure and development. At the momentit is one of the fastest growing markets today with 12.1% growth last year (2004). The growth originates from high oil price, which has been accumulated to people's wages. They are growing nominally more than 20% annually. But even though the income increases, the share of food of all retailtrade has been fairly stable with only a slight decline. Thus, the consumption is shifting to products with more quality and value. The shareof modern retail outlets is low, as the Russian retail sector is still very dispersed to traditional retail outlets such as kiosks, open markets and small grocery stores. The store chains are, however, becoming more and more significant. The biggest market for retailers is Moscow but nowadays the chains are expanding rapidly into other regions. Even though the markets have not been saturated in Moscow, the best prospects for growth are in the regions. The most important factor restricting the growth in Moscowis the availability of real estate and land plots for stores. The market is moving forward to saturation, and a consolidation process will follow. In fact, it has already started but not many acquisitions have been made so far. To this point the domestic chains have settled to form only alliances. The foreign players will be very strong in the tightening competition in the future. The problem of domestic chains is that the stores are nonstandardized, which is not cost-efficient. The chains are trying to enhance their power in price negotiations by forming purchasing alliances, introducing private label goods and using the regional expansion as a striking weapon. In order to follow the growing chains to other regions the producer must sell its products to the chains at favorable terms. Suppliers are strong in negotiations when they have a functioning distribution network, ability to JIT deliveries, proper documentationpolicies, a strong brand, reliability in deliveries and a fair price. The size of the entry ticket, i.e. the listing fee may define the shelf space a producer gets in the stores.

Merchandising Strategies and Retail Performance for Seasonal Fashion Products

This study presents mathematical methods for evaluation of retail performance with special regard to product sourcing strategies. Forecast accuracy, process lead time, offshore / local sourcing mix and up front / replenishment buying mix are defined as critical success factors in connection with sourcing seasonal products with a fashion content. As success measures, this research focuses on service level, lost sales, product substitute percentage, gross margin, gross margin return on inventory and mark down rate. The accuracy of demand forecast is found to be a fundamental success factor. Forecast accuracy depends on lead time. Lead times are traditionally long and buying decisions are made seven to eight months prior to the start of the selling season. Forecast errors cause stockouts and lost sales. Some of the products bought for the selling season will not be sold and have to be marked down and sold at clearance, causing loss of gross margin. Gross margin percentage is not the best tool for evaluating sourcing decisions and in the context of this study gross margin return on inventory, which combines profitability and assets management, is used. The findings of this research suggest that there are more profitable ways of sourcing products than buying them from low cost offshore sources. Mixing up front and inseason replenishment deliveries, especially when point of sale information is used for improving forecast accuracy, results in better retail performance. Quick Response and Vendor Managed Inventory strategies yield better results than traditional up front buying from offshore even if local purchase prices are higher. Increasing the number of selling seasons, slight over buying for the season in order to

Stress testing practices in risk management - Empirical evidence from the Finnish banking and insurance sectors

The main purpose of this study was to analyze how stress tests are used in risk management in the Finnish banking and insurance sectors. In order to enhance understanding of the topic, stress testing was explored in the context of corporate governance and regulato-ry implications of Basel II and Solvency II on stress testing were examined. In addition, the effects of the global financial crisis on stress testing were mapped and the differences in stress testing practices between the banking and insurance sector were discussed. The research method was qualitative case study and it was conducted by interviewing risk managers from ten institutions and a representative from FIN-FSA. Findings pointed out that stress testing practices vary significantly between different institutions. Interesting observations were made in terms of stress testing practices in the banking and insurance sectors. The increasing importance and use of stress tests were recognized as a result of the financial crisis. Stress testing was even considered more like art than science given the amount of challenges it involves. In general, improvements in stress tests were suggested, with an emphasis on stress concentration between different types of risks.

Mobile banking in developing countries

This Master’s thesis examines the feasibility of eBusiness in developing countries by looking at the current mobile banking solutions. The research involved reviewing literature that was relevant to the research questions. It was discovered that the Wizzit and M-PESA are the current solutions to mobile banking. Furthermore, it was found out that the Wizzit and M-PESA were either transformational or additive. Additive mobile banking is the use of mobile phones as a channel to provide services to existing customers within financial institutions. Transformational mobile banking extends financial services to the unbanked. The results of the thesis are M-PESA works with only Safaricom while on the other hand Wizzit has compatibility with any mobile operator. The other result is that both M-PESA and Wizzit are transformational mobile banking technologies at the sametime Wizzit is an Additive mobile banking technology. Wizzit can provide financial services to both the unbanked and existing bank customers. It can be said the merits of Wizzit outweigh those of M-PESA which makes Wizzit better.

Fraud detection in the banking sector : a multi-agent approach

Fraud is an increasing phenomenon as shown in many surveys carried out by leading international consulting companies in the last years. Despite the evolution of electronic payments and hacking techniques there is still a strong human component in fraud schemes. Conflict of interest in particular is the main contributing factor to the success of internal fraud. In such cases anomaly detection tools are not always the best instruments, since the fraud schemes are based on faking documents in a context dominated by lack of controls, and the perpetrators are those ones who should control possible irregularities. In the banking sector audit team experts can count only on their experience, whistle blowing and the reports sent by their inspectors. The Fraud Interactive Decision Expert System (FIDES), which is the core of this research, is a multi-agent system built to support auditors in evaluating suspicious behaviours and to speed up the evaluation process in order to detect or prevent fraud schemes. The system combines Think-map, Delphi method and Attack trees and it has been built around audit team experts and their needs. The output of FIDES is an attack tree, a tree-based diagram to ”systematically categorize the different ways in which a system can be attacked”. Once the attack tree is built, auditors can choose the path they perceive as more suitable and decide whether or not to start the investigation. The system is meant for use in the future to retrieve old cases in order to match them with new ones and find similarities. The retrieving features of the system will be useful to simplify the risk management phase, since similar countermeasures adopted for past cases might be useful for present ones. Even though FIDES has been built with the banking sector in mind, it can be applied in all those organisations, like insurance companies or public organizations, where anti-fraud activity is based on a central anti-fraud unit and a reporting system.

Retail sub - dealer's agreement

kuv., 41 x 26 cm

Retail sub - dealer's agreement

kuv., 41 x 26 cm

From reactive to proactive banking : connecting with customers with context-aware mobile technology

Mobile technology has been employed in banking for already two decades. However, its significance this far has been modest. It is expected that the industry will change a lot in the future. Elements of this change include tightening of competition, considering customer’s individual and changing needs, becoming involved in customer’s life and being where customers are. The goal of this study is to explore these fields with regard to Finnish banking as well as investigate selected consumers’ views towards this kind of new service approach. It can be divided into three questions: • What kinds of mobile services does the Finnish banking industry currently offer for consumers and what expectations do experts and consumers have towards them? o What is consumers’ attitude towards a context-aware service approach in the banking industry and what are the suggested tools for it? o What factors define clients’ adoption intentions towards the new context-aware service approach? Which factors do they consider most important? In order to create the framework for the study, both Finnish and foreign scientific and professional literature considering evolution of the industry and innovation adoption has been used. The empirical part of the study consists of 11 interviews, including 6 expert interviews and 5 consumer interviews. The results show that the selected consumers reacted very positively to the suggested new service approach that considers them as a person and aims at simplifying their banking. The consumers appreciated especially solutions that simplified their everyday banking. Also proactive actions from a bank was considered important especially in everyday banking, as long as the customer was able to define the amount and way of contacts he received. According to the findings banks should aim at supporting their customers more than they do now. However, they also need to pay attention to not irritate their customers by excessive contacts. Banks should also open-mindedly introduce new technologies to their customers. Key words

Carrier selection and management : A case study on Neste Oil Retail

Service provider selection has been said to be a critical factor in the formation of supply chains. Through successful selection companies can attain competitive advantage, cost savings and more flexible operations. Service provider management is the next crucial step in outsourcing process after the selection has been made. Without proper management companies cannot be sure about the level of service they have bought and they may suffer from service provider's opportunistic behavior. In worst case scenario the buyer company may end up in locked-in situation in which it is totally dependent of the service provider. This thesis studies how the case company conducts its carrier selection process along with the criteria related to it. A model for the final selection is also provided. In addition, case company's carrier management procedures are reflected against recommendations from previous researches. The research was conducted as a qualitative case study on the principal company, Neste Oil Retail. A literature review was made on outsourcing, service provider selection and service provider management. On the basis of the literature review, this thesis ended up recommending Analytic hierarchy process as the preferred model for the carrier selection. Furthermore, Agency theory was seen to be a functional framework for carrier management in this study. Empirical part of this thesis was conducted in the case company by interviewing the key persons in the selection process, making observations and going through documentations related to the subject. According to the results from the study, both carrier selection process as well as carrier management were closely in line with suggestions from literature review. Analytic hierarchy process results revealed that the case company considers service quality as the most important criteria with financial situation and price of service following behind with almost identical weights with each other. Equipment and personnel was seen as the least important selection criterion. Regarding carrier management, the study resulted in the conclusion that the company should consider engaging more in carrier development and working towards beneficial and effective relationships. Otherwise, no major changes were recommended for the case company processes.

On advancing business intelligence in the electricity retail market

In recent decades, business intelligence (BI) has gained momentum in real-world practice. At the same time, business intelligence has evolved as an important research subject of Information Systems (IS) within the decision support domain. Today’s growing competitive pressure in business has led to increased needs for real-time analytics, i.e., so called real-time BI or operational BI. This is especially true with respect to the electricity production, transmission, distribution, and retail business since the law of physics determines that electricity as a commodity is nearly impossible to be stored economically, and therefore demand-supply needs to be constantly in balance. The current power sector is subject to complex changes, innovation opportunities, and technical and regulatory constraints. These range from low carbon transition, renewable energy sources (RES) development, market design to new technologies (e.g., smart metering, smart grids, electric vehicles, etc.), and new independent power producers (e.g., commercial buildings or households with rooftop solar panel installments, a.k.a. Distributed Generation). Among them, the ongoing deployment of Advanced Metering Infrastructure (AMI) has profound impacts on the electricity retail market. From the view point of BI research, the AMI is enabling real-time or near real-time analytics in the electricity retail business. Following Design Science Research (DSR) paradigm in the IS field, this research presents four aspects of BI for efficient pricing in a competitive electricity retail market: (i) visual data-mining based descriptive analytics, namely electricity consumption profiling, for pricing decision-making support; (ii) real-time BI enterprise architecture for enhancing management’s capacity on real-time decision-making; (iii) prescriptive analytics through agent-based modeling for price-responsive demand simulation; (iv) visual data-mining application for electricity distribution benchmarking. Even though this study is from the perspective of the European electricity industry, particularly focused on Finland and Estonia, the BI approaches investigated can: (i) provide managerial implications to support the utility’s pricing decision-making; (ii) add empirical knowledge to the landscape of BI research; (iii) be transferred to a wide body of practice in the power sector and BI research community.