A Complete Model of the Supermarket Business
Introduction
This Article provides a complete picture of the underlying skeletal structure that holds every supermarket business together while achieving its goals. The supermarket model introduces a comprehensive framework for managing the complexity of a supermarket structure, and a reusable blueprint for visualizing how a supermarket company actually does business
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The model’s clearly-defined core-processes and their functions provide a powerful baseline for improving business performance. By viewing a supermarket business as a single functional system, the nature of its underlying core processes becomes clear. Then by managing and improving them as parts of a single system, substantial improvements can be made on critical success factors, such as lead-time requirements and the precise availability of stock when needed, throughout the supply chain.
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The method used to develop this Supermarket Model is a collaborative adaptation of an earlier technique called “Integrated Modeling Method.” That method showed how every business enterprise has the same inherent system structure. This new supermarket model incorporates basic elements of that method, with major improvements and a much clearer understanding of how a supermarket business operates in today’s world-wide market environment.
Scope and Focus of the Supermarket Model
A supermarket business enterprise is a large, very complex structure, involving many component entities:
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• An array of repeat customers grouped in various local areas.
• A chain of retail stores.
• Various transportation systems.
• A set of warehouse distribution centers.
• An array of product suppliers under contract.
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A supermarket exists in a competitive environment, where it acts as a value-added intermediary between geographically dispersed supplier companies and the scattered individual customers who eventually buy their products.
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In carrying out its function, a supermarket business acquires and assembles a wide assortment of goods from individual suppliers, then organizes and distributes them as-needed to a chain of retail stores for sale to local customers.
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The supermarket model focuses on the work that is involved in physically handling stock as it makes the journey from supplier to customer. Although it references the business entities that are involved, the model does not include the life cycle development of the physical housing structures of warehouses, stores and trucks, or the equipment they employ.
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The model identifies key parameters that are involved, but this generic version does not include specifics, such as the actual number of product types that a store carries, number of stores and warehouses, their sizes, etc. These are determined when the model is applied to a specific supermarket business.
What is a Business Enterprise?
a typical business enterprise exists in a competitive marketplace, where it acquires resources from its supplier market, adds value by transforming them into products or services, and sells the results to its customer Market.
What is a Supermarket?
A supermarket is a business enterprise that provides a service. It does not produce a physical product of its own in the usual sense. Instead, it adds value by acquiring existing products from remotely-located suppliers, assembling them in regional warehouses, distributing them to local stores, and finally selling the supplier’s products to local customers. Figure 2 shows the general flow of stock from suppliers, through the supermarket business to local customers.
How is the Supermarket Model Structured?
The model portrays a supermarket as a functional system for doing business. As a system, the sequence of work performed in bringing products from remote suppliers to local customers involves certain discrete business entities. Each of these entities provides a critical link in the supermarket supply chain
This sequence of business entities provides an initial breakdown to define the structure of supermarket subsystem layers. To complete the overall structure of the supermarket model, the structure of subsystem layers is overlaid with a sequence of four core processes, which represent the life-cycle of a supermarket business
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The core process sequence begins by defining the business concept in terms of a detailed set of system requirements. This definition of requirements is then transformed into a tangible design, followed by constructing of the structures, procedures and contractual agreements that make up the business. The final core process shows how the resulting structures are employed to provision the actual supermarket service. To fulfill the original business concept, the four core processes are implemented over time. This four-stage development sequence comprises the lifecycle of the supermarket’s business enterprise product.
Conclusion
The supermarket model defines the inherent system structure that is common to every supermarket business.
It provides an architectural framework of function and workflow that can be applied to better understand and improve a supermarket’s business performance.
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By identifying the supermarket’s complete core process and function structure, this model provides a highly efficient tool for more accurate business process identification, improvement and design.