Blue Nile case stydu
SCM44 Case Study
Cheng Gong
1. What are some key success factors in diamond retailing? How do Blue Nile, Zales, and Tiffany compare on those dimensions?
Blue Nile has an obvious advantage in product variety and product availability since customers can “build their own ring” by choosing from an inventory of about 75,000 stones online.
The Tiffany brand is very strong and well established. It is associated with glamour, luxurious, trust, and customer service. So Tiffany can get higher margins than its competitors.
Nile’s supply chain structure has major advantage in facility costs. Because items sold through the Blue Nile Web site are customized. So company can keep inventory longer and reducing safety inventory.
Blue Nile has higher transportation costs than Tiffany or Zales. The outbound transportation time and costs are much higher because of aggregate inventory.
2. What do you think of the fact that Blue Nile carries about 30,000 stones priced at $2,500 or higher while almost 60 percent of the products sold from the Tiffany Web site are priced around $200? Which of the two product categories is better suited to the online channel? In Blue Nile cases, the main reason may be lower inventory holding costs savings safety stock, the company can provide customers with a wide range of product variety and product offerings. Price of $ 2,500 or more stones relatively low demand and high demand for change is unique, high-value items. Company must carry a high demand for large changes in safety stock to meet the required level of customer service. Given the high price of the stones, the cost of holding them in inventory is proportionally higher. Blue Nile through converged network channel inventory, but also broadens the availability and variety of products available to customers. Tiffany brand is built on a charm, luxurious, and quality of customer perception when accessing a tiffany stores. This is due to both sides of the products and services. Company
Cheng Gong
1. What are some key success factors in diamond retailing? How do Blue Nile, Zales, and Tiffany compare on those dimensions?
Blue Nile has an obvious advantage in product variety and product availability since customers can “build their own ring” by choosing from an inventory of about 75,000 stones online.
The Tiffany brand is very strong and well established. It is associated with glamour, luxurious, trust, and customer service. So Tiffany can get higher margins than its competitors.
Nile’s supply chain structure has major advantage in facility costs. Because items sold through the Blue Nile Web site are customized. So company can keep inventory longer and reducing safety inventory.
Blue Nile has higher transportation costs than Tiffany or Zales. The outbound transportation time and costs are much higher because of aggregate inventory.
2. What do you think of the fact that Blue Nile carries about 30,000 stones priced at $2,500 or higher while almost 60 percent of the products sold from the Tiffany Web site are priced around $200? Which of the two product categories is better suited to the online channel? In Blue Nile cases, the main reason may be lower inventory holding costs savings safety stock, the company can provide customers with a wide range of product variety and product offerings. Price of $ 2,500 or more stones relatively low demand and high demand for change is unique, high-value items. Company must carry a high demand for large changes in safety stock to meet the required level of customer service. Given the high price of the stones, the cost of holding them in inventory is proportionally higher. Blue Nile through converged network channel inventory, but also broadens the availability and variety of products available to customers. Tiffany brand is built on a charm, luxurious, and quality of customer perception when accessing a tiffany stores. This is due to both sides of the products and services. Company