APOCALYPSE NOW

BUSINESS REPORT

Sargunn Sahota, Erik Horvath, Prathik Jagadeesh, Hyun Jeong & Carmen Abouzeid
APOCALYPSE NOW LTD.
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Table of Contents

EXECUTIVE SUMMARY:....................................................................................................................2

QUESTION 1): INTRODUCTION.........................................................................................................3

QUESTION 2): COMPANY NARRATIVE:.............................................................................................4

QUESTION 3): ERP AND CASE STUDY:...............................................................................................7

CONCLUSION:.................................................................................................................................10

REFERENCES:..................................................................................................................................11
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Executive Summary:

This report provides an analysis of Apocalypse Now Ltd in relation to its position in its

market and how it attempts to use enterprise resource planning (ERP) systems within its

industry (wholesale) to streamline internal processes. The company, which was established

15 years ago, operates as a wholesaler engaging the B2B model selling product kits aimed to

ensure the ‘prepper’ mentality of people around the world is in good hands, when uncertain

events beckon. Our successful PSK (Preppers Survival Kit) product, through constant

innovation and strict governance of product alignment strategies, has proved to be a

reliable asset and has attained a competitive advantage that has been unmatched,

headlining us as firm market leaders over the last 10 years. The report further investigates

the benefits and disadvantages of the ERP system used in Apocalypse Now Ltd and other

companies within its niche environment. The limitations of using the SCM and CRM are also

detailed and are found not to be complying by the company leaders, as it fails to adhere to

our business structure and achieve our long-term vision. Apocalypse Now Ltd faces vast

challenges in this volatile and saturated industry, however we believe through right

implementations, a decisive and fruitful future will behold, and strong relationships will be

made with consumers and retailers alike.

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Question 1): Introduction

Our firm Apocalypse Now is a market leading firm that aims to profit off of the fears of the

general populace!

Don’t be alarmed by that above statement, we don’t charge exorbitant prices to consumers,

in fact we don’t deal with household consumers at all. Instead we operate as wholesalers,

selling to retailers. In this regard we have wholly based our business model on B2B (Business

to Business) based services. Thus, our target customers are retailers who sell our products

to the final customers. As a B2B based company selling a very niche product, we need to be

very considerate with our pricing strategy as we know the demand for products such as ours

tend to be highly elastic. In this regard, we have emerged as market leaders over time

through adopting a cost leadership strategy wherein we aggressively undercut our rival’s

prices using our excess in an attempt to capture superlative profits. Our most successful

product, the PSK (Preppers Survival Kit) is our staple as it embodies this aggressive strategy.

The PSK operates within the consumer staples category due to the nature of the goods

within the kit. The products within the PSK are essential for the final customer due to the

scarcity surrounding these goods in times of uncertainty (see COVID-19). In particular, the

PSK is the magnum opus for all ‘preppers’, it’s the ultimate product they desire to have to

meet their ‘survival’ needs and at a low price point, it’s simply a must have for all ‘preppers’.

Considering that we sell our PSK at the lowest possible price within the market to other

retailers, the PSK will thus be cheaper to the final consumers relative to other similar

products. In this regard, our product poses a major financial advantage relative to our

competitors. Furthermore, considering that our capacity is sufficiently large enough to meet
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demand at all times, consumers (both consumers and households) can rest assured that

there will not be a shortfall of the PSK. Thus, the benefits of our product pertain to the cost

advantage we generate for our customers (retailers) and the promise of quality/quantity we

guarantee due to the scale of our operations. Our competition tends to be other producers

of ‘Preppers’ specific items, although this is a thin market, so the competition is less intense

than a perfectly competitive market. Our product’s greatest differentiators correlate heavily

with our advantages, notably our product differentiates itself from the rest of the market

through its low price, stable supply chain ensuring that there will be no shortages and

quality ensuring that only the highest quality of produce is used in the production of the

PSK.

Question 2): Company Narrative:

Our company, Apocalypse Now, was established 15 years ago after our founding member

decided to establish his own company based on the idea that emergency supplies should

always be readily available at hand should the apocalypse arrive in the immediate future.

Through innovative yet careful planning, our company was finally established within the

wholesale goods market with our signature product, the Preppers Survival Kit, more

commonly known as the PSK. The PSK was originally designed to have the most long-lasting

rations of emergency consumables ready at hand at any given moment. Our company had

gone through numerous phases of opportunities to develop and research to create the

perfect apocalypse survival kit our consumers would ever need. Ranging from survival

equipment such as knives and lighters to nutritional preservable food that comes in various

flavours to allow diverse palatable consumption of emergency rations. If the standard retail
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PSK is not up to our customer’s standard, our website also includes customizable PSKs to

suit each individual’s desire for their PSK in cases where a standard survival kit is just not

enough for our customer’s needs.

However, the business took many years of business to achieve its’ status as a market leader.

Our company had gone through multiple phases which changed how we as a business

operate. Through corporate entrepreneurship, new innovative approach to research and

development on the PSK improved significantly, improving both the management of the

resources and supplies required to produce the PSK through changes in technological

standards and the incorporation of information systems (Kuratko, Morris and Covin,

2011).In the initial stages, we took advantage of the current situation at the time, where

people became paranoid and fearful regarding a world ending prediction (Pallavi Singhal,

2020). It was through this initial stage that the concept of the PSK was first introduced. The

conceptual design of the PSK eventually developed into the first prototype series of the kit,

targeting the fearful masses who would hoard and stock up on supplies. The kits were sold

at a partnered small retail store, where it was a complete success, and as such, further

speculations into how to further develop and sell the product ensued (Yarrow, 2014).

It was through this initial success did the idea become the spark to initiate an entrepreneur

endeavour. As such, we developed the business into a wholesale supplier, which would sell

the kits at a low price to ensure cost advantage via cost leadership strategies. By partnering

with retail outlets, the PSK gained a sufficient amount of customer attraction to establish a

niche consumer base and loyalty, thus allowing the business to continue in its operations
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(Stewart, 2019).However, though the initial success allowed business operations to flourish,

much like all stages in the business cycle, the company had started to hit a plateau, as the

product’s original design was that of an emergency supply kit. Thus, the company invested

into improving its consumer base through developing variants of the PSK, which would

generate additional revenue from our current loyal and newly acquired consumers. This

investment decision created a brand image for the PSK, which solidified its placement within

the goods market.

The increase in consumer base allowed the company to consider investment into further

quality driven supplies which solidified the business’ brand quality. Where improving the

quality of our individual goods within our product has given it further awareness and loyalty

value by its consumers. Furthermore, by implementing various online services, we gained

further understanding of our consumers wants and needs, which would further supplement

management business decisions. It is these aspects which helped create the foundation

which turned the PSK into a successful entrepreneur endeavour. Currently we are

considering the radical incorporation of enterprise resource planning systems to further

improved the business operations by increasing production efficiency, allowing for greater

resource flow for production to improve base performance. Numerous steps have been

taken to ensure that our customers gain the greatest quality of emergency, apocalyptic

supply kits available within the market. It is through these factors that built the foundation

in which our company has become the prevalent market leader amongst many.

 
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Question 3): ERP and Case Study:

Despite our firm occupying a position within its market as a market leader, there is always

room for improvement to ensure the maintenance of this market leading market share. As a

team, we are of the opinion that by employing an ERP system to streamline internal

processes and automate mundane tasks, the upside is profound for our chosen business

(Chand et al., 2005). Considering that our firm operates within the wholesale industry and

thus the firm has many moving parts, adopting an ERP based system would allow for better

co-ordination across the supply chain, enhanced efficiency and improved bottom line

performance (Kang, Park and Yang, 2016). The team believes ERP would add more value for

our firm relative to SCM or CRM as our firm already has large market share and stable

relations with our suppliers/customers. Due to the stability of the relationships with our

suppliers, the teams feel SCM would not add much value to our organisation due to the

limited need for an upheaval of our existing supply chain processes. Similarly, the team felt

CRM was perhaps not the best option to undertake to streamline internal processes and

reduce inefficiencies. CRM would have been a better fit had we opted instead to undertake

a project through which we wanted to remain connected with our customers or enhance

the consumer experience for our clients. Again, due to our market share and the cost

advantage strategy we employ by always pricing lower than our competitors, we felt CRM

perhaps would not be a good fit to employ to achieve our key strategic goal of enhanced

efficiency (Hendricks, Singhal and Stratman, 2007). Any of the higher end ERP systems (SAP

S/4 HANA, Oracle ERP Cloud etc) would be a good fit for our organisation due to the scale of
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our operations (Gargeya and Brady, 2005), however they are simply too expensive for us to

consider. Taking this into account, we believe Acumatica would be the perfect system for us

due to its flexible pricing model and proven track record of success with organisations

operating in similar industries to ours (Reinbolt, n.d.).

Despite the apparent benefits of employing an ERP based system for our business, it is

important to note that adopting such a system will not be without its challenges. Such

challenges were evident for all to see when Lidl, a wholesale German grocery chain with

revenues in excess of €100 billion partnered with SAP to ‘de-clutter’ their in-house inventory

system (Josh Fruhlinger, 2020). On paper, such a partnership sounds incredibly exciting, SAP

is the global ERP/CRM powerhouse and they specialise in providing solutions to

organisations such as Lidl to streamline internal processes and improve efficiency. However,

over the seven years the project was active from 2011-2018, a staggering €500 billion was

spent to achieve only middling results (Kimberling, 2018). A major reason as to the failure of

the partnership in not streamlining the inventory system for Lidl pertained to the reticence

displayed by Lidl in changing their record keeping processes. This reticence proved to be a

mistake as Lidl recognised their inventory based upon the price they paid for the items as

opposed to following the industry standard method of recognising their industry based

upon the retail price they paid for the items. By not changing their record keeping

methodology, Lidl hamstrung the ability of SAP’s ERP system to restructure their inventory

system. This then meant that Lidl was not benefiting from the advantages ERP can bring to

an organisation as they were not receptive to the changes such a system brings about to an

organisation. Another critical reason as to why the project did not succeed in meeting Lidl’s
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criteria involved the large turnover of staff. Lidl let a lot of key personnel go during the

course of the project as they tried to downsize to reduce costs and rationalise the cost of

the project (Saran, 2018). Instead of laying off staff, Lidl should have attempted to provide

training to their staff so that they would be placed in better stead to work with the

integrated range of applications ERP would bring to the firm.

With reference to the case study of the failed ERP implementation of Lidl, our firm is now

better equipped to understand how to successfully deploy ERP across our organisation after

taking into account the key learnings from Lidl’s experience with ERP. Bearing in mind the

reticence displayed by Lidl in switching up their record-keeping processes, our firm will learn

from this mistake and instead opt to pursue changes that can streamline internal processes

with enthusiasm, provided the logic for those changes is fundamentally sound.

Furthermore, our firm will also opt to train our employees so we can support them during

this period of change rather than laying them off. Through learning from the mistakes made

by Lidl and reacting accordingly, our firm will be placed in a position to stand to gain

tremendous upside from the implementation of an ERP project through their supply chain.
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Conclusion:

This business report evaluated the current market position of Apocalypse Now Ltd and how

they aim to use ERP to strengthen their position amongst their peers. As a wholesaler selling

‘prepper-specific’ items, Apocalypse Now has carved out a niche for itself in its market

through their cost advantage pricing strategy. Despite this significant market share,

Apocalypse Now wants to streamline internal processes and improve efficiency through

implementing ERP so they can improve their overall performance. In order to resolve

headwinds they may encounter, the case of Lidl’s failed ERP implementation was analysed

to better understand which areas of their organisation Apocalypse Now should focus on to

ensure that the ERP system succeeds in meeting their objectives.

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References:

Chand, D., Hachey, G., Hunton, J., Owhoso, V. and Vasudevan, S., 2005. A balanced

scorecard-based framework for assessing the strategic impacts of ERP

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<https://www.sciencedirect.com/science/article/abs/pii/S0166361505000722>

[Accessed 1 September 2020].

Gargeya, V. and Brady, C., 2005. Success and failure factors of adopting SAP in ERP system

implementation. Business Process Management Journal, [online] 11(5). Available at:

<https://www.emerald.com/insight/content/doi/10.1108/14637150510619858/full/ht

ml> [Accessed 1 September 2020].

Hendricks, K., Singhal, V. and Stratman, J., 2007. The impact of enterprise systems on

corporate performance: A study of ERP, SCM, and CRM system

implementations. ScienceDirect, [online] 25(1). Available at:

<https://www.sciencedirect.com/science/article/abs/pii/S0272696306000052>

[Accessed 1 September 2020].

Josh Fruhlinger, T., 2020. 16 Famous ERP Disasters, Dustups And Disappointments. [online]

CIO. Available at: <https://www.cio.com/article/2429865/enterprise-resource-

planning-10-famous-erp-disasters-dustups-and-disappointments.html> [Accessed 1

September 2020].

Kang, S., Park, J. and Yang, H., 2016. ERP Alignment for Positive Business Performance:

Evidence from Korea's ERP Market. Journal of Computer Information Systems, [online]

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<https://www.tandfonline.com/doi/abs/10.1080/08874417.2008.11646032> [Accessed

27 August 2020].

Kimberling, E., 2018. Lessons From An SAP Failure At Lidl - Third Stage Consulting Group.

[online] Third Stage Consulting Group. Available at: <https://www.thirdstage-

consulting.com/lessons-from-an-sap-failure-at-lidl/> [Accessed 31 August 2020].

Kuratko, D., Morris, M. and Covin, J., 2011. Corporate Entrepreneurship And Innovation.

[Place of publication not identified]: South-Western Cengage Learning.

Pallavi Singhal, T., 2020. Toilet Paper And Pasta: Here's What Sydneysiders Are 'Panic

Buying'. [online] The Sydney Morning Herald. Available at:

<https://www.smh.com.au/national/toilet-paper-and-pasta-here-s-what-sydneysiders-

are-panic-buying-20200303-p546j9.html> [Accessed 3 September 2020].

Reinbolt, M., n.d. ERP Examples | Examples Of ERP Systems For 2020. [online]

Selecthub.com. Available at: <https://www.selecthub.com/enterprise-resource-

planning/erp-examples-features-platforms/#:~:text=For%20example%2C%20in%20the

%20supply,demand%20products%20are%20in%20stock.> [Accessed 2 September

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Saran, C., 2018. Lidl Dumps €500M SAP Project. [online] ComputerWeekly.com. Available at:

<https://www.computerweekly.com/news/252446965/Lidl-dumps-500m-SAP-project>

[Accessed 1 September 2020].

Stewart, B., 2019. The Importance Of Customer Loyalty - 5 Benefits | Emarsys. [online]

Emarsys. Available at: <https://emarsys.com/learn/blog/what-is-customer-loyalty-and-

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why-is-it-important/#:~:text=Loyalty%20can%20stem%20from%20many,and

%20services%20than%20new%20customers.> [Accessed 3 September 2020].

Yarrow, K., 2014. Decoding The New Consumer Mind. New York: John Wiley & Sons Inc.