Operations management involves managing activities associated with production and distribution of goods and services. While producing and distributing goods and services, a manufacturer should have a goal to accomplish and strategies of achieving it (Shim & Siegel, 1999). Primark stores ltd is an organization which is the largest clothing retailer by volume and the best budget store on High street in Great Britain according to Allbusiness (2009). The store establishes its customers' requirements through market segmentation which entails establishing a target market in which to sell its products. Target marketing enables primark to position itself and its brands against competitors in the clothing industry hence increasing its sales.
There are various ways of segmenting a market such as; based on geographic conditions, demographic, psychographic, behavioural characteristics among others (Proctor, 2000). Primark segments its market according to demographic factors such as; age and gender. It targets customers of below 35 years of age and mostly females in high street locations (Allbusiness, 2009). Its clothes and designs are simple, of high quality and cheap and it offers the most popular sizes although recently it offers apparels and accessories to all human sizes (Fabe, 2008). Target marketing enables organization to employ the best market mixes and hence reduce wastages and maximise profits (Kotler & Armstrong, 1999). Primark doesn't advertise its products hence reducing operation costs. It is also listed as one of the companies that doesn't heed to labour requirements as its suppliers have been accused of child labour. It is also accused of exploitation and abuse of labour force and poor work conditions (Fabe, 208). This impacts negatively on its image and may discourage customers.
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Operational Systems and Processes
Customer satisfaction is the ultimate goal of all organizations. The operating systems and processes are therefore geared towards satisfying customer needs. According to Muffatto & Panizzolo (1995), planning, design and monitoring are the processes required for a company to achieve customer satisfaction. Inappropriate choice of process leads to poor performance. Primark has established different branches in different countries ensuring efficient distribution and thus satisfying customers. Recently, Primark has partnered with Island pacific to install high value innovative software that assists in customer and vendor relationship management, merchandising, point of sale, planning and demand forecasting. Shim and Siegel (1999) argue that these processes comprise operations management which assist in customer satisfaction.
Primark is involved with batch processing which entails clear identification of position of markets its dealing with and thereafter setting operation functions in line with the market. Galloway (1993) observes that batch processes are the best as they satisfy an order easily and can cope with minor changes without difficulty. It is also a member of ethical trading initiative and has established a code of conduct for its suppliers to ensure ethical standards are maintained (Primark, 2010). Primark provides high quality clothes which are inexpensive and strategically placed in high street making it easy for customers to purchase. Customer service employees are trained to handle buyers effectively. An unsatisfied customer who has a complaint resolved is source of positive word of mouth thus attracting more customers (Stauss & Seidal, 2005).
Primark is a lean business organization that caters for customers needs (Primark, 2010). Its operations are based on giving value to the customer while eliminating waste such as; excess inventory, overproduction and underutilized staffs (Carreira, 2005). To ensure quality, each finished part is examined after manufacture and defects identified and returned to production line for rectification. This ensures smooth flow of the process until the desired product is achieved. Lean technique thus enables primark to satisfy customer requirements.
Capacity is the volume of output produced at a given period and the ability of a facility to handle the production. It enables a firm to identify the amount of materials required for optimal production so as to avoid overproduction or delay in production. Short-term capacity planning includes; offering overtime, increasing shifts, hiring casual labourers, subcontracting facilities, modifying output and demand (Inman, 2010). Long-term capacity planning includes opening new branches or adding capital equipment. Inman (2010) identifies four techniques of capacity planning; use of overall factors, capacity bills, resource profile and capacity requirements planning (CRP) used in conjunction with manufacturing resource planning. Primark stores measure activity from customer point of view hence needs planning
Always on Time
Marked to Standard
Primark stores are mostly used for distribution of clothing while manufacturing work is subcontracted abroad. The process of manufacture involves assembly line until a product is achieved. Finished garments are distributed to primark stores by suppliers. The clothes are kept in departments such as womenswear, menswear, childrenswear, lingerie and footwear among others (Primark, 2010). The stores are overcrowded making it difficult to get what one requires. Each store has a manager who is in control and has been delegated power. Each department is also headed by deputy manager and sales floor has supervisors.
Scheduling entails resource allocation to tasks in order to achieve objectives. It is a decision-making process regarding the best mix of resources and tasks (Pinedo, 2008). After capacity planning, scheduling is carried out to make sure raw materials and resources are available at specified time. At primarks, the suppliers are given instructions regarding quality production, product specification and lead time (Primark, 2010). It's upon them to use resources and deliver goods in time according to set time target in order to satisfy customer requirements.
It entails management of sales, purchases and payments to control operation costs. According to Cheng & Choi (2010), primark uses Global Quick Response (GQR) to manage inventory. Primark offers different new fashions frequently hence has high stock turnover. It uses "advanced inventory management and tracking systems that monitor movement of goods on hourly basis in all stores" (2010: 56). It has also advanced warehouse facilities that enable flexibility, speed, productivity and low costs and large scale global contracting.
Monitoring and Evaluation
Monitoring involves assessment to check whether goals are being met while evaluation is analysis of progress towards meeting objectives. Monitoring and evaluation are used to measure the performance of a business in the global market. Primark monitors and evaluates its operations based on the ethical trading policy which emphasizes on quality without oppressing workers (Primark, 2010). It values human rights, employment conditions, business practices and suppliers. Suppliers have a code of conduct to govern their operations and frequent audits are carried out to establish whether they are conforming to standards. Performing suppliers are given high volume orders. Audits are used to establish turnover level, production process and share of supplier's production. These determine whether primark will be able to meet customers' requirements as its performance depends on the suppliers. Recently, primark has acquired Entropy supply chain monitoring software from BSI systems for auditing (Primark, 2010).
Primark stores ltd is a leading retail chain in GB that offers high quality inexpensive clothes to young people located at high street areas and with various branches in Europe. Operations management in the supply chain entails lean techniques and all activities are directed by customer needs or values. It is a member of ethical trading initiative that takes care of workers needs and its suppliers are governed by a code of conduct and are audited frequently to monitor progress. This ensures labour standards are maintained and employees are not exploited.