On November 13th, V.me, a “digital wallet” that holds multiple payment cards in a virtual repository, just ended its beta-testing. Instead of providing card numbers to make online payments, customers just simply enter a username and a password.

The amounts of credit and cash that the largest payment networks process exceeded $15 trillion last year (see graph below), indicating huge potential in the payment network industry.

This innovative technology will sooner or later cause an entire paradigm shift in the credit card industry.  The best strategies that current credit card companies should take into consideration are 1. add more online services to plastic cards in order to make it seem more attractive.  It will take some time to completely phase out plastic cards, so this strategy is still necessary to most companies.  2. Put large amounts of energy and funds into the field of virtual wallets.  Virtual wallets are efficient, eco-friendly, and closely tied in with the technology craze.  Although the cost of replacing credit card processing equipment is significant and will halt the process, the takeover of virtual wallets is inevitable.  Therefore, credit card companies should put most of their effort into product innovation and try to discover effective points of differences in this new field in order to gain a competitive advantage.

Works Cited:

“Credit-card companies: War of the virtual wallets.” The Economist – World News, Politics, Economics, Business & Finance. 18 Nov. 2012. <http://www.economist.com/news/finance-and-economics/21566644-visa-mastercard-and-other-big-payment-networks-need-not-be-victims-shift>.

This article presents unique analysis of the role of inventory and how to manage inventory.  Up until the point when a customer demands the item, inventory is simple resources that are tied up.  Therefore, the management of inventory is very much dependent on the accurate forecasting of demand.

The cereal example that was mentioned in class cannot fully incorporate all the aspects of operations that must be considered.  This is because cereal is generally nonperishable, so the lead time (i.e. the time it takes for the product to get to the customer) has very little effect on customer satisfaction.  For most small restaurant or grocery store businesses, operations is a constant battle between customer satisfaction and cost efficiency.  Firms such as McDonald’s already have a mature supply chain, constant transportation costs, and steady consumer demand.  Therefore, McDonald’s can focus all of its effort on gaining customer satisfaction, which is providing meals in a quick and efficient manner. Small businesses, on the other hand, should focus on keeping bestsellers in stock and have the shortest lead time possible for either special orders or a sudden increase in demand.

Works Cited

Griffiths, Chris. “Don’t let inventory weigh you down.” The Globe and Mail. Web. 18 Nov. 2012. <http://www.theglobeandmail.com/report-on-business/small-business/sb-money/cash-flow/dont-let-inventory-weigh-you-down/article4683167/>.

Transport Management. Web. 18 Nov. 2012. https://gc21.giz.de/ibt/en/opt/site/ilt/ibt/regionalportale/sadc/inhalt/logistics/module_01/16_components.html

Qoola’s stylish interior:

Sally Gao presented interesting ideas in her blog post, The Two Frozen Yogurt Stores in the Same Shopping Mall. She pointed out that although Qoola entered the market later than Yogen Fruz, Sally observed that Qoola usually had much more customers.

Some effective points of difference are 1. Qoola’s yogurt is self-served, providing the customer with room for customization.  Qoola also has a large variety of toppings and flavors to enhance this aspect. 2. Qoola’s store is very well designed, giving the customer a feeling of a special ambiance and a unique experience.  Not only is Qoola usually strategically located in the most stylish malls in town, it also provides its customers with free wi-fi, making Qoola a great place to hang out for teenagers.

Similar to Toms’ One for One product line, Qoola’s marketing is not so much focused on the product itself.  The marketing strategy is centered around the consumer’s entire experience of purchasing the product.  By purchasing the product, the customer is also paying for the experience of customizing their own meal and the enjoyment of the atmosphere.

Works Cited:

“Yogurt Nation vs. Tutti Frutti vs. Qoola.” Our Planet. N.p., n.d. Web. 19 Nov. 2012. <http://www.ourawesomeplanet.com/awesome/2010/06/yogurt-nation-vs-tutti-frutti-vs-qoola.html>.

“Review: Qoola Yogurt and Fruit on Denman.”Vancouver Blog. N.p., n.d. Web. 19 Nov. 2012. <http://www.miss604.com/2009/02/review-qoola-yogurt-and-fruit-on-denman.html>.

The Economist blog post, Costs to Come, points out that although the harms of global warming to the economy are quite apparent, most people still have an incentive to emit unnecessary amounts of carbon dioxide and waste natural resources.  Hurricane Sandy, which was allegedly caused by global warming, has had immense negative impacts on the suffering US economy.

However, the post also states that there is a solution to this problem – harsh taxing of the emission of greenhouse gases.  For example, the costs of car emissions must be internalized by the driver, so that the driver will have a greater incentive to drive less and use public transportation.

Yet it is doubtful that people will find this solution attractive, because high carbon taxes or large public investments have negative short term impacts. As the diagram above points out, the global cap and trade costs are huge compared to the impact of a hurricane, and even the Vietnam War is dwarfed by the whopping 1.9 trillion dollars. Looking only from the short-term economic point of view, it is difficult to determine whether or not the tax should be imposed, but we cannot disregard the ethical impacts of our decisions.  We need to create a sustainable system, not only because it will undoubtedly generate great economic value in the future, but also because we have the social responsibility to take initiative in improving the future of the global community.

Works Cited:

“The Cost of Global Warming: A Story in Pictures.” The Foundry: Conservative Policy News Blog from The Heritage Foundation. N.p., n.d. Web. 19 Nov. 2012. <http://blog.heritage.org/2009/04/06/the-cost-of-global-warming-a-story-in-pictures/>.