Chapters Five and Six Questions and Answers, Essay Example

1. (1). Harley-Davidson has relied on bar codes and optical scanner technology to monitor inventory for years. However, technology such as radio frequency identification devices (RFID) may replace bar codes and scanners in the company’s future. RFID’s use radio transmission to monitor inventory as it moves through the supply chain. RFID’s have many advantages over bar codes, which use a system of parallel lines and an optical scanner to track inventory. RFID’s are more efficient than bar-codes due to increased accuracy and faster processing. To be accurately read and processed, bar codes must be strategically placed and visible to the scanner. RFID tags can be placed anywhere on the packaging and are able to be processes even if their view is obstructed from the readers by packaging materials, dirt or mud. RFID’s also have a broader range and can be read from distances up to six feet away, while bar codes must be scanned precisely within a few inches. RFID tags are more durable than bar codes, and are less likely to get damaged in harsh weather. Though bar codes are secure, there is a potential for them to be copied. RFID tags may provide more security for the packages because they rely on radio transmission, which would make them more difficult to reproduce. At one time, each RFID was required to have its own battery power supply, but now passive RFID tags do not need a power source. After the initial set-up of the system, RFID usage is less expensive long term than bar codes and scanners.

Despite the many advantages of RFID’s, there are some potential disadvantages for companies. Harley-Davidson already has an established system of tracking inventory with bar codes and optical scanners. They spent a lot of time and money to coordinate their suppliers with using EDI’s. Harley-Davidson works with many smaller suppliers that use a website with internet EDI capabilities. These small suppliers can log into the website and conduct EDI transactions through browsers. The system is so established that it became the Harley-Davidson Supply Net. Problems may arise if Harley-Davidson implements the change of bar code and scanners with RFID’s among its smaller suppliers. The established system will be disrupted and the small suppliers may not have the time or the financial resources available to convert to the new inventory monitoring system. Harley-Davidson could lose business with some of its most loyal suppliers.

1(2). When Wal-Mart decided to replace bar codes and scanners with RFID’s in their supply chains, it was not without challenges. Wal-Mart wanted to more efficiently manage inventory and reduce the incidence of stock-outs to prevent loss of sales. In order for RFID’s to work, all systems must be in coordination. One challenge was that the RFID tags, their readers, and computer systems were expensive for Wal-Mart’s suppliers. Many of Wal-Mart’s suppliers wanted an extension of time to allow them to have the funds to transition to RFID’s. While RFID’s are cheaper in the long-term than bar codes and scanners, the initial cost can be difficult for small suppliers and companies that ship large amounts of low-priced goods. Harley-Davidson could face similar issues, as it conducts business with many small suppliers who may not have financial resources to replace their established system of bar codes and scanners with RFID’s.

2. Social networking sites such as Facebook allow for the promotion of many different products. Marketing cosmetics on Facebook would be advantageous because it targets specific communities and encourages discussions and feedback. Information on cosmetics is distributed when Facebook friends “liked” the cosmetics and the company. Customers and their Facebook friends receive up-to-date information on the latest products, such as current trends in lipstick shades.

Consultants for companies such as Mary Kay and Avon, can communicate directly with their clients sales groups, informing when events or sales are taking place. Companies with specialty stores such as Bare Minerals and Aveda let customers know about special events, such as sales and free demonstrations.

3. Auction sniping occurs when buyers place high bids at the last moments of an auction. Online auctions require a fast internet connection with no distractions. Some buyers will purchase sniping software designed to track the auction to the last few seconds to ensure they have the winning bid. While many eBay users welcome the use of sniping software, there are those who feel it should be prohibited. Because the software is programed to place the winning bid, actual buyers often lose to the software. The use of sniping software may discourage some users, especially newcomers, because they feel this gives snipers an unfair advantage and encourages cheating. These users may either be discouraged from online auction sites completely or discontinue with eBay. Though eBay retains a current monopoly of online auctions, a niche could be created for companies who prohibit sniping software. While many users promote the use of sniping software, eBay could lose business because there are enough people who feel it is unfair. Others, especially newcomers, may choose to save money and not purchase sniping software if it is possible to participate in auctions where it is prohibited. Competition could easily arise from large companies, such as Amazon, or small companies that see the need for the niche to be filled.