Professional Documents
Culture Documents
Quickest Deliveries
Quickest Deliveries
Quickest Deliveries
for
Quickest Deliveries
Organisational Structure We propose that a tall, hierarchical one, which is split into different sub-departments
(Marketing, HR).
Operations Core practices include parcel delivery and courier service, with potential for
conglomerate expansion such as foreign exchange services and insurance
Recruitment & Training It is suggested that employment prospects be more flexible with personnel, and that
QD adopts a geographic quadrant model, and the stages of the change are
described. An outline of provided training is also provided.
Support End of the month meetings with the franchisees and a digital platform, in which the
franchisees can share ideas and concerns are also suggested. In addition to that, as
a competitive strategy, a loyalty programme should be introduced.
Financials It is recommended that the franchisor suggests receiving loans from banks they have
established relationships with. The royalty payments should be fixed at 5% of the
franchisee’s profits.
Territory Allocation and It is suggested that franchisees have the freedom to branch out across multiple
Franchise Agreement geographical locations. Alongside that, it is recommended that a 3-7 year franchise
contract is the best option for QD.
Challenges The challenges QD faces internally and externally, and how to mitigate them are
outlined in the report.
2
`
TABLE OF CONTENT
Table of content
3
Introduction
Within the delivery and parcel industry, Quickest Deliveries biggest competitors, Royal
Mail owns 47% of the total market share within the UK. Hermes, on the other hand, is
the second biggest competitor by holding 11% of UK’s total market share within the
industry and Yodel, their third competitor with 8% shares. They contributed £9.7bn to the
industry in 2016 which was 9.7% higher than 2015. This shows the existence of potential
growth within the delivering and parcel industry as well as Quickest Deliveries chances
of growing.
This report aims to develop a feasible strategy that will enable QD to achieve their
growth and development objectives related to all the points mentioned
above.
4
1- Organisational Structure
6
2- Operations
2.1- Main Operational Activities of Standardisation
Franchise Means of transport: we would require franchisees to
At QD core operational activities include parcel use a hybrid or electric vehicle to be in line with
delivery and courier services which accounts for a ethical standard and uphold corporate social
major proportion of total revenue, we mark this under responsibility. This would also give a competitive
the bracket of ‘business model at risk’ considering the edge in terms of being environmentally friendly and
volatility of return on investment caused due to avoiding bad PR from pressure groups.
geopolitical tensions that occurred in the region (i.e. Price: we Recommend keeping price points the same
Brexit). It is advisable for QD to adopt parts of growth across all regions domestically, however, the
and expansion through conglomerate expansion, international deliveries should fall in line or slightly
including insurance products such as travel & below, their respective national rivals
providing foreign currency exchange services to its Uniforms should be consistent as this is a symbol of
client base through a network of franchisees. This the business and a use of both conscious &
conglomerate diversification of business operations non-conscious promotion
will help QD to reach its long-term financial goals Training should be consistent as we want all workers
while minimizing risk. It must be noted that the to have a competent skill set in order to meet client’s
operational activities for each franchise have a needs and uphold QD’s high standards of service
degree of tailoring to its customers as we have across all regions.
recommended these locations to be split into Accounting policy should be consistent to be true
geographic quadrants of north, east, south and west. and fair and report with transparency to stakeholders
2.2- Standardisation and adaptation of QD, e.g owners, government and suppliers
Insurance policy - There should be uniformity in
Standardisation Adaptation delivery insurance all over QD’s as delivery driver
requires delivery insurance as per the United
Means of transport Payment methods
Kingdom legislation
Price Promotional offers Adaptation
Uniform Employee contracts Payment methods: we recommend QD’s adopt the
payment methods in respect to the location,
Training Foreign currency exchange consideration of payment methods i.e Bank transfer
services
or Apple pay. In highly developed areas/cities such
Financial Accounts Working hours as London, Birmingham; QD’s should adapt to such
payment methods to facilitate and accommodate the
Insurance Policy
needs of the customers by enabling easy access to
7 financial payments without any hassle or delay.
Operations
Employment contracts: As this would fit in They should be free to set up these outlets in any
with the divisional structure ethos. Some geographic location as it allows for greater
regions may be heavily populated therefore it diversification of risk on their part. However, it
would be infeasible to have 1 or 2 drivers full could be said there is more risk as if a bad apple
time but rather a group of part-time employees. has 4 outlets that’s 4 bad apples. This, therefore, is
This would, of course, be different for different up to the HR department to recruit effectively.
locations and hence QD’s need to adapt Therefore we recommend them to branch out
according to the respective market in order to
fulfil their objectives in that particular region. A
major benefit of this is motivated staff and lower
employee turnover. promotional
policy - The policy QD should implement in
terms of promotional costs is that the
franchisees are responsible to provide
promotional support for their franchise.
Foreign currency exchange services - We
believe there might be areas which do not
require this particular service, however, on the
contrary, some areas may do; it should be left
on the franchisee if they wish to avail this
particular service to offer to their clients.
It is QD’s duty to ensure that their promise of However, for the age, although not compulsory, the
excellence is maintained in their courier business should have a preference for younger
service. Therefore, it is of utmost importance to drivers. Aged between 20-35. The rationale for this
the head office to properly promote, vet, train is that they are presumed to have a longer lifespan
and support applications in order to keep this than older applicants and thus would provide more
consistent as the network of franchise grows. years of service to the company and save on
Part of this is established in our recruitment employee turnover costs. The final benefit of their
manifesto below; youth is that they shall be more receptive to any
3.1- Profile of Franchisee technological changes we may implement now and,
We suggest QD to require the franchisee to have in the future, as they have been exposed and
2:1 degree in a business related course, and/or thus saving time and costs of further training and
10
Recruitment and training
Given below are the number of training techniques The initial training that the company should
we propose that QD must provide to their franchisees provide are:
based upon the fresh geographic quadrant model ● Customer service
suggested for QD. ● Simulation trials
By adopting the Geographic quadrant model each ● Driving test
geographic location would be run by its geographic ● Machinery training
manager who would then be answerable to the ● Label assortment
national overseer. We propose that the national ● Scanning
overseer be answerable to Mel (C.O.O). Before these ● Health and safety
respective individuals take the managerial position,
they must be made aware of the market, value, The On-going Training that should be provided
products and every aspect of services provided by by the company are:
QD’s. As these are crucial roles we propose that Mel ● Staff quality appraisal every two month
should educate and train the national overseer of ● Pay rise appraisal every half a year
QD’s to the best of her abilities, which can be
achieved through face to face meetings by providing
practical and theoretical training held by Mel. From
this point onwards, we suggest that the national
overseer train the four respective geographic
managers in relation to their roles and duties within
QD’s.
11
4- Support
4.1- Best practices and mechanisms to Recommendation
improve support and communication As much as face to face in person interaction is
between franchisor and franchisees. important, considering today’s digital age we believe in
Communication between franchisees and franchisor QD to have its online presence is also vital. We
should be frequent and without constraints in order to be strongly recommend QD to implement both the
effective. Thus, for franchisees to deliver feedback to above-suggested mechanisms as part of a single
franchisors there should also be trust and opportunities strategy.
for them to express their ideas. We suggest following 2 4.2- Strategies for franchisees competitive
practices QD can undertake to enhance feedback
edge in their industry
mechanism. A competitive edge is simply what gives QD an
A) End of month meetings advantage over its competitors. The focus is one why
We suggest QD organise “end of month” meetings customers would choose QD rather than rivals such as
between all franchisees and the franchisor whereby they Royal Mail or Hermes.
discuss and explain, if any, progress has been made in
Loyalty Program
running their outlet. During these discussions, there
In order to QD’s franchisees have a competitive edge
should be detailed reports prepared by the management
we recommend QD to develop a 10% off national
of each individual franchise of the last month's
delivery membership card, which could cost £20 a
operations. They should have detailed self-assessed
year and a 10% off international membership card,
audits whereby they are able to account for any beneficial
progress made and how this may be implemented by which could cost £50 a year. Customers can also
other groups. Also, it must be noted should the franchisor benefit from a 500 points free delivery, on each
be wanting to implement any brand changes these should delivery made by a customer they will collect 50 points
be noted to the franchisee outlets so there is harmony and once they reach 500 points they can get a free
between the franchised outlets and those of QD itself. delivery of an item up to 2kg valid for national delivery
B) Digital platform services.
We suggest that QD’s create an online forum so that the Compensation for loss and damage
franchisee not only shares ideas with the franchisor but To have a competitive edge and to stand out in the
also with other franchisees, as long as it is not something market we suggest QD provide customers with
confidential that violates the franchisor-franchisee complimentary ‘product delivery insurance’ which will
agreement. Furthermore, with the help of online forum the further help QD to attain trust and healthy relationship
franchisees would be able to put on their feedback ideas,
with their customer base, maintaining peace of mind
views and concerns conveniently and in a time efficient
amongst customers on their delivery. Under the
manner upon which the franchisor can later take
scheme, QD will compensate for general damage and
reasonable and actionable decisions to amend such
loss of the product in the process of being delivered
concern and build upon the suggested feedback ideas.
for up to a maximum of £500 varying upon the weight
12 of the product.
5- Financials
5.1- Initial fee We recommend QD to determine royalty payments
For Quickest Deliveries, we recommend the initial on the basis of profit after expenses, rather than
on turnover or sales considering the fact the
fee for every potential franchisee to remain the
turnover and sales are unhinged by the reality of
same.
costs of running the business day to day.
● The price is set to be £126,500:
● Franchising fee - £39,500;
5.4- Other costs
● Additional costs for opening outlet - £62,000 Other than the royalty payment and general set up
● Working capital of approximately £25,000 cost, there are also external costs that franchisees
and a minimum of £50,000 is needed by the need to consider are:
franchisee to serve as a buffer for cash flow ● Cost of opening an outlet; that will be an
management to be solvent. approximation of £62,000.
● The total working capital, we recommended
5.2- Franchisees’ franchise fund for franchisees to have is an approximation
of £25,000 and a £50,000 cash flow
In order to gather enough capital to open a new available in case an issue arises within the
franchise with QD, most franchisees are expected franchise.
to fund their franchise with bank loans. QD will ● Marketing & promotional costs should also
establish favourable terms with banks, which be considered, and the initial marketing
means they (QD & its franchisees) will receive a investment should be approximately
lower interest rate because QD is “repeat between £20,000 and £70,000.
customers’, and have worked with the bank(s) ● Cost of the delivery vehicles
before. Alternatively, they may use their own
personal capital.
5.5-Vehicles Cost
In terms of transport costs that franchisees need to
5.3- Royalty payments consider: if a Nissan E-NV200 van or equivalent is
provided for free, as a “welcome” gift by QD then
The royalty payment for the franchisees to franchisees will not incur the buying cost of the
franchisor is fixed at 5% of the franchisee’s profit transport, however, they would be expected to pay
after expenses. We decided that the company for any maintenance and repair costs required.
should charge a 5% royalty because this low rate And if they require a new vehicle in the future, they
enables franchisees to retain more profits. ill have to purchase one for themselves, then they
will have to consider the buying cost of the new
vehicle.
13
6- Territory allocation and Franchise
Agreement
The locations of the franchise model are stated in We would recommend a relatively small
the above geographic quadrant method. This franchise such as QD to opt for a minimum of 3
would work where the franchisor along with the years and a maximum of 7. The minimum
franchisees would set up the appropriate franchise requirement would allow for the franchisee to
locations in specific regions, such as the North. effectively establish itself in the region and gain
There is no quota limit on a number of franchisees customer confidence and in turn, consolidate
that may operate in a specific region as long as QD as a customer favourite for courier and
there is an adequate demand which would be delivery service. The maximum option of 7
researched through the head office. In case of years is used to yield a maximised return from
multiple potential franchisees are wanting the successful franchisees. The maximum term
same specific location, then QD should accept the would not be readily available to new
party with best qualifications and or experience to franchisees, however, but those who have
trade in the location. If a situation arises where the completed a minimum 3-year contract and have
candidates are evenly matched then there would been successful in terms of key factors such as
14
7- Challenges
With thousands of business being very keen to
deliver their products in the United Kingdom. The - Proof of delivery alerts
demand for delivery solutions providers has been -Invoices to customers
quite extraordinary. Over the course of business -Black box’s in vans to ensure compliance with laws
QD’s will face a number of expected and and safety
unexpected challenges due to the radical changing
environment and the seemingly unpredictable External Challenges
business world. We aim to highlight possibly the There may be situations which occur whereby QD
key challenges QD’s would face over the course of cannot readily preempt but rather manage
their business. followings its existence. These include;
Political & Legal - QD must be readily available to
Internal Challenges respond to legislative changes made by the
government, these may include a change in the
7.1 -Possible challenges and how to address insurance policy they have on their products. They
● Customer satisfaction and Issue can mitigate this risk through hiring a competent
Management. It is important for QD’s to be legal team to ensure they do not break laws and
transparent in its dealings with its customers hurt their brand image
and to make sure that all parties involved are
on the same page. QD’s offer the fastest
possible delivery services which include
domestic same day and next day courier. As
the business grows this will surely become
one of the crucial challenges faced by QD’s.
As their market supply grows i.e their
customers increase on a large scale there is
a need for B2C companies in our case QD’s ● Economical - QD must be responsive to
to provide feasible offers rather than economic changes. These include slumps and
15
Challenges
16
Conclusion
4956 Words
17
References
Thank You!
Declaration form
Minutes of Meeting
Meetings:
The ideas developed for accomplishing the client's growth ambitions are strong. The report shows
awareness of potential competitors and opportunities in the parcel delivery sector. The style used in
presenting the Executive Summary is original; thus, it is a very good idea to have done this - but
some of the sentences should have been phrased in a better manner.
Although the presentation of the report is very good in most parts, there were several parts with
typos, and these should have been corrected. Also, it would have been better to consistently develop
the justifications for the recommendations clearly. For example, it was recommended
that franchisees should be allowed to have a maximum of four outlets to prevent them from having
too much power. But it is not clear why an organisation where, having too much franchisee power
should be avoided. Another example is, where it was mentioned that franchisees' initial fees should
remain as it is - but there was no justification for why this is optimal.