¶ … e-Commerce could bring to the BestBake Bakery Cost reduction

Capability

Competitive advantage

Communication improvement

Control

Customer service improvement

Implementation Plan for the e-Commerce with Timeline

Contact Strategic Customers and Suppliers (3 Months)

Determine what Competitors are doing (1 Month)

Evaluate and Acquire Proper Tools and Skills (2 Months)

Start Simple (3 Months)

End-to-End Validation & Accreditation Testing (2 Months)

Go Live! (1 Month)

Monitor (Ongoing)

Extent of the e-Commerce implementation within the Timeframe Specified

Market Penetration

Market Development

Product Development Strategy

Diversification Strategy

References

Appendices

List of Figures

Appendix 1: Business Model of BestBake Bakery

Appendix 2: Key Drivers of e-Business (Tassabehji, 2003)

Appendix 4: Ansoff model for Growth Strategies (AdamKasi, 2008)

Introduction to the BestBake Bakery.

Appendix 1 gives a brief outline of Bestbake bakery.

BestBake is a retail business, so it comes under the classification of business -- to - consumer (B-2-C) that sells cakes directly to consumers, though it also has Business -- to -- Business (B-2-B) interaction with suppliers of raw materials for the bakery. Bestbake current business model is shown at Appendix 2, showing there are four departments in BestBake -- administrative, purchasing and logistics, bakery (manufacturing), marketing and sales.

Three departments interact with the administrative department that performs the human resource (HR) and finance functions. The purchasing and logistics unit deal with the procurement of raw materials from the suppliers and reports to the administrative unit for finances and request for HR. The bakery department does the baking of the pastries/cakes, whilst the marketing and sales unit communicate with the customers directly by selling to them, including attracting new customers and getting feedbacks from customers. Currently, communication is done via telephone, faxing, letters and paper printouts due to the absence of a company website and internet access.

Over the years, BestBake has been able to survive the heat of the competition around the local area, although it has been very challenging. There is a need to improve and extend beyond London to other parts of the country.

"The key question is not whether to deploy Internet technology -- companies have no choice if they want to stay competitive -- but how to deploy it."

(source: Porter, 2001)

Therefore, BestBake's aim is to offer easy, convenient and affordable pastries/cakes to its customers through the traditional word of mouth service as well as via e-Commerce. The e-commerce would be integrated with an effective and aggressive online marketing strategy in order to expand the consumer base. In this paper we focus on the e-commerce adoption strategy as well as elements and functionality.

Benefits and Opportunities that e-Commerce could bring.

BestBake is aiming at introducing an e-Commerce platform in order to enhance its sales functions. The e-commerce platform to be adopted by BestBake is a sell-side e-commerce strategy. This sell-side e-commerce platform will be used in processing of transaction between the company and its customers, regardless of their geographical reach . It should be noted that e-Commerce is not about the Internet or website only but a new business concept that incorporates the previous business management and economic concepts. e-Commerce is the conduct of business over computer networks usually over the Internet, while e-Business incorporates both e-Commerce and servicing of customers, suppliers and business partners over networks like the Internet (Tassabehji,2003). It is expected that e-Commerce will create an effective environment for BestBake operations bringing about a strong demand and strong supply of BestBake cakes, as shown in the Appendix 3.

Functionalities of the sell-side e-commerce strategy

BestBake would be able to leverage the e-commerce concept to expand their coverage, effectively respond to the new markets as well as increase their level of competitive advantage. The company aims to realize the full potential of e-commerce in the alignment of their sales, marketing as well as service function on the basis of real-time client information (Oracle,2008). This would enable the company to collaborate effectively across multiple business channels.

The proposed e-commerce platform would accomplish the following;

1. Take order from customer.

2. Bill the customer from their credit cards and bank accounts via PayPal payment gateway

3. Process the order in regard to the calculation of buying price, shipping as well as any discounts.

4. Enable the customer to track their order in real-time

5. Host an eCRM platform for handling of customer complaints and queries

Provide a discounting system based on special discount Coupons
According to Chaffey et al. (2003), the benefits can be described in terms of the 6 C's as follows:

1. Cost reduction:

The introduction of e-Commerce to BestBake bakery's operations would aid customer relationship management (CRM), supply chain management (with the suppliers and customers) and internal operations management within the BestBake bakery.

In CRM, BestBake website would reduce the costs of marketing by placing new addition to stock online and making customers aware through email marketing, instead of printing handbills and using telephone marketing on an adhoc basis. A content management system powered website, which can easily be updated in-house with little or no technical background, is all that is required. The website would also incorporate a customer management system that would be used to keep details of customers and these would be used to send them information about offers and new products. These measures, would save the telephone cost involved with calling customers and potential customers on regular basis, in order to make them aware of recent offers and products. Moreover, the cost of printing handbills as well as getting ad-hoc staff to distribute the handbills is nullified.

Also, purchase and procurement of raw materials used by the bakery would be incorporated into the online presence with the database of the suppliers properly recorded and each contacted for supplies, as required, online. In addition, the cost of keeping stocks of raw materials is reduced with the database of stocks updated every time they are used up and this triggers an alert on the purchasing and logistics intranet whenever there is low stock. This would save the cost of counting stocks all the time and the impact of running out on stocks abruptly (Andam, 2003; Chaffey et al., 2003).

2. Capability

It is no doubt that e-Commerce would bring about an increase in the capability of BestBake. With the online presence, BestBake is not location restricted and would be able to reach out to more customers and potential customers in different parts of the country (beyond central London) (Chaffey et al., 2003). The company would have to improve its production capacity that would be fueled by a surge in demand that would be generated by the In relation to the online marketing aspect, search engine optimization (SEO) would be taken into consideration in the design of BestBake website taking into account the highly sought keywords. This is in order for their e-commerce enabled website to show up on the first page of major search engines Search engine optimization is a strategy used in ensuring websites show up on the first page of major search engines (most especially Google) and it would be very rewarding if the BestBake e-Commerce website is built with SEO in mind (The Bivings Group, 2008; Chaffey et al., 2003).

In addition, operations within the staff of BestBake bakery would be easier and faster as information is adminstered online. For example, payroll and finance management would be computerized within the administrative unit and this would help to achieve more in a short period with little or no error. Taking stock of raw materials would be made easy for both the purchasing and logistic unit and the bakery unit, in order to avoid a halt in business due to shortage of materials. Hence, the business is kept running non-stop with each unit performing effectively (Chaffey et al., 2003).

3. Competitive advantage

BestBake's main competitors are Konditor and Cook, Hummingbird Bakery, Primrose bakery and numerous other bakeries. Konditor and Cook and Hummingbird Bakery already have an online shop for product ordering. What BestBake needs to do is to add more functionality to their upcoming website such as Live Chat and order tracking system. BestBake can realize a true competitive advantage by embarking on operation effectiveness. This means doing like its competitors but doing it in a better way. By embarking on strategic positioning, the company can deliver very unique value to its customers (Phan,2001). The main principles of strategic positioning involve setting up goals that are oriented towards long-term return on investment, creating a distinctive value chain and engaging in trade-off for the company to gain uniqueness in the market. As suggested by Porter (2001), internet technologies such as e-commerce should be used to complement to the exiting techniques rather than cannibalise the traditional ways of competition.In regard to customer segmentation, the company would target people who are busy and hence have no time to go to the traditional brick and mortar bakeries/confectioneries. With customers being able to place order for pastries online and being able to get these delivered to them gives BestBake a competitive advantage over other local bakeries. Any offer and new products put online for customers and prospective customers also give BestBake a competitive advantage in regard to product marketing (Using Discount Coupons).Even before the competitors think of doing the same thing, BestBake would have secured a large share of the customers. An anticipated increase in the efficiency of staff…