The Reject Shop Limited Business - Case Study Example

Research Report- The Reject Shop Limited Name: Institutional Affiliation: Instructor’s Name: Date: Introduction This paper is an assessment report of the experiences learnt about the Reject Shop Limited, through an interaction with the internship manager. The Reject Shop is an Australian based organization that operates a series of discount retail stores. The company offers a wide range of products among such as the homewares, cosmetics, toiletries, confectionery, hardware, furniture, seasonal gifts and personal care products. The company operates under the subsidiary of the Trading Group Pty Limited, with a total of 196 stores within the banner. In Australia, the Reject Shop operates stores in the New South Wales, Queensland, Tasmania Victoria, West and South Australia. The company’s stores are served from its distribution centres located in Melbourne Airport, Queensland and Ipswich. The Business and Its Legal Type The history and development of the Reject Shop is traced back over thirty years. It was founded under legal partnership between two parties, John Shuster and Ron Hall in 1981. The two founders were driven into starting the business by the growing demand for the general consumer merchandise across Australia. The initial setup of the Reject Shop was to offer the daily needs such as snack food, household cleaning products and cosmetics among others to its customers (Roth, 2013). The Partnership legal system of ownership was chosen because of the existence of common interests between the two founders of the business. The two were interested in serving the consumers bets with what they needed ant the same time making profits out of the business. During the commencement of the business, there were financial and legal support offered to the Reject Shop. For instance, the credit institutions in Australia offered great support to the company by giving credit facilities to the company for expansion and maintenance of the business. On the other hand, the legal and judicial system of the government guided the company on matters relating to legal operations and issuance of the operating licence (Adetule, 2011). Ownership of the Business The Reject Shop was started as a new business in 1981 by John Shuster and Ron Hall. That is, is neither purchased nor inherited from another party. Since then, the company has grown from its form of being a ‘seconds’ store to a renowned discount variety store. The advantages of starting a new business include: There are no risks associated with the underperformance if the business was to be purchased. In other words, there are no costs needed to initiate improvements the new company. When starting a new business, the initiator(s) have a free will to choose where to locate the business in regard to the strategic market positioning (Morrison, 1998). The disadvantages of starting a new business are; the initial capital requirement for establishing the business may be high depending on the size of the business. There is no guarantee for a successful start up of the business (Mahadevan, 2010). Therefore, the starters of the business have to risk losing in the process. Also, the business has to solicit for new customers, market for the products, suppliers, stock as well as equipment without immediate flow of cash. This increases the costs needed to run and, maintain the business during its early stages of development. The Typical Consumer As stated in the marketing theory, marketing is an activity that aims at improving the potential for services and sale of products. The whole process of marketing involves effective communication between the company and its customers. The Reject Shop has established a powerful communication system between the company employees and its customers. It reaches its customers through various communication channels such as the print media. The company reaches its customers through the social media. This is evident from the fact that the company attained 100,000 fans on Facebook in 2014 (Taylor, 2004). Through such social media platforms, the company is able to get the customer feedback regarding their services and general opinions about the company. Customers can post their comments and suggestions through social forums. Reasons why customers buy the Reject Shop’s Products The Reject’s Shop customers are driven by the value and satisfaction they obtain from the products they buy. The customers always want value for their money alongside addressing meeting their everyday needs (Williams, 2006). They also benefit from the seasonal gifts from the company. The Reject Shop’s Human Relation Issues The company applied the motivation theories such as that of Abraham Maslow where the customers are motivated to buy more products from the company by giving them seasonal gifts as well as setting low prices for goods they buy (Rahmatian, 2011). The human relations of the company are guided by the Mile’s model which emphasis on participatory approach in leadership. That is, the human resource department of the company adheres to the practical principles of leadership as shown in the table below. Management Styles and Issues of the Company As a large company, the Reject Shop has a well structured system of management where all the system works together as one unit to achieve the main goals of the company. From a practical perspective, the company utilizes the requirements of the systems theory of management to manage its operations. This is evident from the way the activities of the company are coordinated right from the top management level, then to various departments of the company like the sales and marketing departments and finally to the workers at the ground level (Pickering, 2011). Information flows systematically from the managers to the heads of departments and eventually to the common employees. What I didn’t like about the Reject Shop There are three major things that I did not like about the company. First, the system in which the company offers gifts to its customers is seasonal. That is, the customers receive gifts during hot seasons such as the Christmas festive season. The company can improve this by readjusting its system of rewards to at least a monthly basis. Secondly, the fact the volume of sales and profits of the company increases annually, the name “Reject” and the layout profile of the store makes difficult to tell if it is reducing the potential of more investors and customers. I suggest the changes to be made to the name of the company to suit its purpose of making profits. Lastly, the company has not spread effectively to other possible markets at international sphere. This reduces the customer base and the general profits. The management of the company should consider developing strategies of how to exploit the international market by expanding its stores. Reflection on learning outcome From the organizations internship manager, I learnt that the success of a business is a gradual process. Also success is not automatic as challenges are expected. Starting a new business needs require determination and motivation. Lastly, I learnt that well developed strategies are necessary to maintain a business in better position in a competitive market. References Roth, M. 2013. Top stocks 2013 a share buyer’s guide to leading Australian companies. Milton, Qld, Wrightbooks.http://search.ebscohost.com/login.aspx?direct=true&scope=site&db=nl ebk&db=nlabk&AN=490428. Adetule, J. 2011. Handbook on management theories. Bloomington, Author House. Morrison, B. 1998. Management theories for educational change. London [u.a.], Chapman Publ. Taylor, R. 2004. Practical application of classroom management theories into strategies. Lanham, Md, University Press of America. Pickering, F. 2011. A tramp's wallet. Macon, Ga, Mercer University Press. Rahmatian, A. 2011. Copyright and Creativity the Making of Property Rights in Creative Works. Cheltenham, Edward Elgar Pub. http://public.eblib.com/EBLPublic/PublicView.do?ptiID=767153. Williams, P. 2006. How to turn your million dollar idea into a reality (from the man who sold the MCG): from imagination to implementation. Camberwell, Vic, John Wiley & Sons. Mahadevan, B. 2010. Operations management: theory and practice. Upper Saddle River, Pearson. Read More