The actual costs that such a service implies are relatively small, especially since this can also be an online communication services of the YM type that can be employing individuals working from home.
Decrease profit margins
The issue here is relatively simple: Blockbuster should decrease its proposed profit margins in order to become more competitive on the online market and be able to increase its future revenues. In this way, with a balanced reduction of costs as well, the company can go from current losses to a potentially profitable business in the near future. The costs can be easily cut by a series of measures that can include reducing the size of the stores (already steps towards cutting overhead costs have been made with the reduction of retail space), but also more investments towards areas that can keep costs down in the future as well (the online environment is obviously a good example in this sense). This will increase the competitiveness of the company and its capacity to face threats on the market.
Some of the acquisitions that Blockbuster will be making in the future also need to be clearly analyzed and determine whether the added value justifies the price paid, as well as whether the company that is being acquired is likely to have costs that will impact the acquiring company's balance sheet.
Conclusions
The paper has identifies some of the operational problems that Blockbuster has. Many of these are related to its capacity to remain competitive on a market that requires flexible players, able to reduce their costs while keeping the same levels of activity. The online presence seems the best way by which Blockbuster...
We have proposed an integrated website that will present more of the services that Blockbuster can offer to its customers.
At the same time, costs remain a problem and a principal cause of the losses. The company will need to adapt more, while retaining its main focus, and either reduce retail space or simply close some of its stores. The shift needs to be made more towards a competitive online environment that can maximize revenues, while significantly reducing costs.
Bibliography
1. Blockbuster Corporate - Company Overview. On the Internet at http://www.blockbuster.com/corporate/companyOverview.Last retrieved on October 14, 2008
2. On the Internet at http://www.planetfeedback.com/Blockbuster+Inc./Overall+Experience/Blockbusters+Process+is+Backwards/305704.Last retrieved on October 14, 2008
3. Kelleher, Kevin. Blockbuster vs. Netflix: The DVD Death Match. July 2007. On the Internet at http://gigaom.com/2007/07/31/blockbuster-vs.-netflix-the-dvd-death-match/.Last retrieved on October 14, 2008
Blockbuster Corporate - Company Overview. On the Internet at http://www.blockbuster.com/corporate/companyOverview.Last retrieved on October 14, 2008
On the Internet at http://www.planetfeedback.com/Blockbuster+Inc./Overall+Experience/Blockbusters+Process+is+Backwards/305704.Last retrieved on October 14, 2008
Kelleher, Kevin. Blockbuster vs. Netflix: The DVD Death Match. July 2007. On the Internet at http://gigaom.com/2007/07/31/blockbuster-vs.-netflix-the-dvd-death-match/.Last retrieved on October 14, 2008
