Redbox: Example Of Warehouse And Transportation Leader

The movie rental industry is a living industry; there are constant changes with advances in technology, rights management, and the slow, but steady, move away from physical Media. Companies such as Netflix, Hulu, RedBox, and Blockbuster are being forced to look at new business models and try to keep up with these changes.

Innovations in transportation and telecommunications have introduced a number of opportunities for companies of all sizes and types to optimize their transportation networks. This paper provides a description concerning the design of a logistics network that consists of only one warehouse. A discussion concerning what steps will need to taken in order to design the optimal network is followed by a description of the information and data that is needed to make this determination. Finally, an assessment of the strategy will be employed in this network is followed by a summary of the research and important findings concerning these issues in the conclusion.

Blockbuster implemented a new strategy for customers to access their rentals in “five channels of distribution: in-store, by mail, through vending machines and kiosks, online, and at home (direct to the TV)” (DATAMONITOR, 2009). However, this strategy was a reactive approach to the problem produced ten years behind schedule. Wooldridge et al., (2007) stated that Blockbuster should select and adapt their strategy to respond to the fast changing market and maintain a competitive position. This was an obvious failure for Blockbuster. The changes in the market produced a decline in profit at a faster pace than the strategies that Blockbuster implemented to combat these losses.

Mike Sadle is the owner of Mike’s Wrecker Service in Huntsville, Alabama. Mike has been providing tow services in the Huntsville and the surrounding areas for the past 20 plus years. During that span, Mike has experienced firsthand the growth and evolution of the towing industry. The purpose of this project was to help Mike identify an area in his business where a significant contribution could be made to increase the overall success of the company. The goal was to present Mike’s Wrecker Service with a telematics solution that will not only bring added value to the company but also provide a significant competitive advantage.

Blockbuster used to have so much power in the movie rental industry until Redbox and Netflix have come to the market. One of Porter’s five forces

The main suppliers for the Redbox and other movie rental business are the movie production houses which own the copyrights of the movies produced by them. Three major studio houses 20th Century Fox, Warner Brox and Universal separately refused to sell DVDs to Redbox atleast 28 days after their arrival in stores. Other major studio houses, Sony Pictures, Paramount Pictures and Lionsgate signed distribution deals with Redbox. Since Redbox’s business model largely relies on new releases, “windowing” of new releases by the three studios may make Redbox’s business model unviable. Redbox responded by filing lawsuits with three claims against these companies - copyright misuse, tortuous interference and antitrust claims. In August 2009, a federal judge rejected the first 2 claims but allowed the antitrust claim to continue. Earlier this year, Redbox dismissed the lawsuits and reached and agreement

Motion pictures are a key driver of the market for entertainment products, one of the largest export markets in US. Motion picture industry consists of three stages: studio production, distribution, and exhibition. The studios produce the lifeblood of the industry, the films that are its content. The biggest players at this level are the majors, big studios which integrate production and distribution, as do the slightly smaller mini-majors. The next stage is distribution. Distributors are the intermediaries between the studios and exhibitors. Distribution entails all steps following a film’s artistic completion including marketing, logistics, and administration. Distributors coordinate the manufacture and distribution of

For example, if a customer in NYC places an order, they will be assigned to the closest distribution center, for that location it would be Flushing, NY. If the first DVD in their queue is not available at this location it will check the next closest center, Stamford, CT. If that center does not have it as well, the system works down the distribution center list until the DVD is located. If the DVD is not available from any center at that time, the software checks the next movie in that customers queue and restarts the process. Even if the DVD ends up being sent from the Netflix main library in San Jose, CA, the system will print a return shipping label for the closest distribution center to the customer in order to minimize return-mail times (Cohen).

They also initiate the contracts with the theaters and negotiate the percentage of box office sales they will receive. Many of the distribution companies are integrating with the production studios because the need for distribution is diminishing with the conversion to digital. This makes these suppliers a strong force.

Redbox is an easy way to rent and watch DVDs, Blu-Ray Discs and Video Games via automated kiosk or electronic device based streaming video. Kiosks are located at select fast food restaurants, grocery stores and convenience stores. Each Redbox kiosk holds approximately 630 DVDs/Blu-ray Discs/Video Games. DVDs rent for $1.20 per day, Blu-ray discs at $1.50 per day

4. First of all, unlike Blockbuster, which rents physical media off of their shelves in the stores, Redbox rents their movie by using the especial kiosks. With the help of such kiosks, the company can greatly reduce the expenditure of setting and maintaining the store. So Redbox can have more locations to rent the movies while having less cost. More location can result more profit. And such kiosks have enough room to contain a lot of movies. Furthermore, as the information in kiosks will still be updated on websites, people can check online to know what movies can be rented without going out to store and asking the employees. So it is more convenient for customers. Secondly, Blockbuster does not have a good pricing strategy for its target market. Blockbuster has expensive rentals and high late fees, which helps to drive the average consumer to kiosk rentals and streaming services. The price of Redbox is much more comparable. And the price on Redbox Instant is even cheaper in order to attract more customers. Thus, Redbox has gained a good reputation among customers.

 Good distribution concepts with no one store more than 6 hrs. away from warehouse.

In the last part, two strategic options, production development and market penetration, are chosen to apply Bunnings’ strategy into actual implementation stage. In production development option, employee understanding, customer satisfaction and

As Netflix has more disc-based subscribers than Redbox, Netflix has higher cost of revenues than Outerwall’s cost of sales and services through Redbox. However, the Netflix’s inventory turnover ratios are lower than Amazon’s inventory turnover ratios because Netflix has a content library of DVDs and streaming content as inventory. Furthermore, a trend of Netflix’s inventory turnover ratios decreased over time probably due to rising

Following considerable investment in new warehouse and carrier management systems the number and quality of delivery options had increased. Now delivery options include: same day, next day or standard delivery options that normally takes around 2-3 days. Also customers can set delivery date by themselves and if wanted can be notified via email or text alerts of delivery status. In addition 85% if orders are tractable