2 Good Sports Limited is an independent sports goods retailer owned and operated by two partners, Alan and Bob. The
sports retailing business in the UK has undergone a major change over the past ten years. First of all the supply side
has been transformed by the emergence of a few global manufacturers of the core sports products, such as training
shoes and football shirts. This consolidation has made them increasingly unwilling to provide good service to the
independent sportswear retailers too small to buy in sufficiently large quantities. These independent retailers can stock
popular global brands, but have to order using the Internet and have no opportunity to meet the manufacturer’s sales
representatives. Secondly, UK’s sportswear retailing has undergone significant structural change with the rapid growth
of a small number of national retail chains with the buying power to offset the power of the global manufacturers.
These retail chains stock a limited range of high volume branded products and charge low prices the independent
retailer cannot hope to match.
Good Sports has survived by becoming a specialist niche retailer catering for less popular sports such as cricket,
hockey and rugby. They are able to offer the specialist advice and stock the goods that their customers want.
Increasingly since 2000 Good Sports has become aware of the growing impact of e-business in general and e-retailing
in particular. They employed a specialist website designer and created an online purchasing facility for their
customers. The results were less than impressive, with the Internet search engines not picking up the company
website. The seasonal nature of Good Sports’ business, together with the variations in sizes and colours needed to
meet an individual customer’s needs, meant that the sales volumes were insufficient to justify the costs of running
the site.
Bob, however, is convinced that developing an e-business strategy suited to the needs of the independent sports
retailer such as Good Sports will be key to business survival. He has been encouraged by the growing interest of
customers in other countries to the service and product range they offer. He is also aware of the need to integrate an
e-business strategy with their current marketing, which to date has been limited to the sponsorship of local sports
teams and advertisements taken in specialist sports magazines. Above all, he wants to avoid head-on competition
with the national retailers and their emphasis on popular branded sportswear sold at retail prices that are below the
cost price at which Good Sports can buy the goods.
Required:
(a) Provide the partners with a short report on the advantages and disadvantages to Good Sports of developing
an e-business strategy and the processes most likely to be affected by such a strategy. (12 marks)
