1.Analyze 99 Cents Only Stores using the value chain and competitive forces models. 22

2. Leading retailers
First opened in 1982 and has nearly 300
retail locations
Carry general merchandise including food
and beverages, health and beauty aids,
cleaning supplies, etc…

3. Covers an area of over 22,000 square feet.
4.3 million dollars of net sale per store
Presently, the total sales are much over $1
billion

4. Targets 25% growth every year.
Texas has the largest number of stores
launched in 2004.
The stores are serviced by a strong
backbone of a 741,000 sqft distribution
center worth $23 million.

5. Despite opening 38 new stores in 2003, the
IT budget didn’t surpass $5 million because
the company’s founder and chairman resists
computer technology…

6. Adams evaluates actual cost versus business
value to the company of every initiative,
whether it involves technology, real estate, or
the melding of the two. Because Adams has a
programming background, when it comes
time for the company to deploy a new system,
he can effectively weigh the cost of
purchasing software off the shelf against the
cost of writing the software code himself or
with his IT team

7.  Greatest challenge: Launching a new
distribution center
 Time constraints were strict
 Final conclusion: Find a warehouse
management system that was totally
customizable

8.  A system that would lock out such
shipments because of inflexible rules
would be a hindrance to the business.
 Adams found the flexibility he needed in
HighJump Software's Supply Chain
Advantage software.

9.  The Supply Chain Advantage system is
designed in such a way that users can make
changes themselves instead of relying on IT
specialists, the vendor, or outside sources
to upgrade and manage the system. This is
especially important to Adams, who likes to
avoid recurring costs that can drain a
company's budget.

10.  The Supply Chain Advantage package
includes a warehouse management system,
Warehouse Advantage, that tracks the
status of every product during its time in
the warehouse…

11.  The Supply Chain Advantage software
module called Yard Advantage manages the
company's delivery trucks, directing them
to the proper locations for loading or
unloading and monitoring the inventory
that each truck is carrying. Customer
Service Advantage creates a portal that
employees at 99 Cents Only Stores retail
locations can use to check on scheduled
shipments

12. Question : 1
Analyze 99 Cents Only
Stores using the value
chain and competitive
forces models.

13.  99 store use value stores and its major
competitors are Big Lots, Inc., Wal-Mart Stores
Inc., Dollar Tree Inc. the value chain store for 99
store is very good. The company decision in
purchasing high jump supply chain advantage for
its advantage for its new distribution center will
help them to solve the issue they have with new
issue .

14. Competition
99 Cents Only vs. Comparable
Dollar Stores
 99 Cents Only is a discount retailer that competes
with other stores that have similar business
models. Thus, the company faces direct
competition from dollar-store chains, such as
Family Dollar Stores (FDO) and Dollar Tree Stores
(DLTR) , that sell many of their products at or
around $1.

15. 99 Cents Only vs. Big-Box
Sellers
 As a discount retailer, 99 Cents Only faces
significant competition from big-box sellers like
Wal-Mart Stores (WMT) and Target (TGT), whose
enormous scale allows them to extract value in
their inventory purchases and pass these savings
on to consumers.

16. Question 2
 Evaluate the current business strategy
of 99 Cents Only Stores in response to
its competitive environment. What is
the role of information technology
infrastructure in that strategy?

17.  99 Cents only Stores’ business strategy is to extend
their business as much as possible. They are
targeting higher income group also because every
person wants to save his money. And higher
income group people will buy in bulk so the profit
margin will be better in that case. 99 cents only
has a potential to support more than 400 stores so
they can open new stores across USA. In 2004 half
of their stores were opened in Texas only.

18.  Broad selection of available goods
 Food & Grocery 55%
 Household and housewares 14%
 Health and beauty care 10%
 Hardware 3%
 Stationery and party 5%
 Seasonal 4%
 Others 9%
Src: securities and exchange commission, USA

19.  Strong Long-Term Supplier Relationships
 Store Location and Size
 Key traffic areas
 Uniform format
 Advertisement
 $5.5 million 0.4% 2011
 $4.1 million 0.3% 2010
 $4.4 million 0.4% 2009
 Print Media
Src: securities and exchange commission, USA

20. Marketing Strategy

21. Role of information technology
 Significant investments in a variety of
infrastructure, data management, and process
improvement projects
 High speed wireless data backup lines
 Financial, accounting, human resources, and
payroll data processing using Lawson Software
 HighJump Software for Supply Chain Management
 Online shopping site.

22. Question 3
How effective is 99 Cents Only
Stores' strategy for IT infrastructure
investments? Explain your answer.

23.  Using information technology(IT), but on a budget.
despite opening 38 new stores and beginning
operations in the new distribution center the
company's IT budget did not surpass $5 million.
 He self resists computer technology in his own
office.
 He uses Radio Shack TRS-80 personal computers to
the business in the 1980s
 Adams has a programming background, self write
code for his software which reduces the cost of
software.

24.  High Jump :The High Jump package addressed
related to the operation of the new distribution
center: quick implementation, high functionality
,adaptability, and interoperability with the
advanced automation technology of the new
distribution center
 Yard Advantage: It manages the company's
delivery trucks, directing them to the proper
locations for loading or unloading and monitoring
the inventory that each truck is carrying.

25.  Question 4:How successful have 99
Cents Only Stores' strategy and use of
information systems been in
addressing the company's problems?
What kind of problems can they
solve? What are some of the problems
that they cannot address?


26.  With the new software company will be able to
meet its requirements of RFID and voice based
inventory system which will enable them to work
more efficiently and reduce the time lag in
displaying products in the stores.
 Some of the issues which are difficult to handle
are the implementation of new software
successfully and training of employees because
distribution center is working in 3 shifts and its
difficult to give training to them separately.

27. Thank You!