Hollywood Hunter

For a chain store such as Blockbuster, which is mainly engaged in video cassette rental, the most expensive part of the cost is the storage and logistics related costs of the video cassette.The purchase price of a video cassette for rental may be only US$15, but its storage and logistics costs during the operating cycle are as high as US$50 to US$60.

In order to accelerate the turnover of video tapes among users as much as possible to reduce the number of video tapes purchased and the pressure of warehousing and logistics, and in order to obtain more revenue, Blockbuster has implemented a late payment system.

The video tapes rented by users usually have 7 days of usage time, and more than 7 days, they will start to pay the late fee daily.

On the original timeline, one point that Netflix repeatedly attacked Blockbuster was the late payment system that this video chain store made consumers hate. For this reason, it also fabricated a founder to pay $40 for a box of "Apollo 13". The late payment resulted in the creation of Netflix.

In fact, this story was completely fabricated, and BesTV even nearly sued Netflix.For Netflix, this effect is very good.

Because of the late payment fee, it is indeed a weakness of BesTV.

After acquiring shares and controlling BesTV, Simon reminded the management of Nancy Brill and BesStar to pay attention to the problem of late payment.

However, in the early stage of the development of BesTV, the late payment fee did play a very effective role. Therefore, this system has always been implemented.

However, as competition in the North American videotape industry became more intense, Blockbuster's late payment system became increasingly outdated.

"In the past few months, I have conducted various types of experiments to cancel late fees in the three cities on the east and west coasts. The results show that after the cancellation of late fees, the frequency of user rental video tapes increased significantly, and the revenue of chain stores not only did not decrease, but increased. of."

The Blockbuster executives on the stage are still introducing Blockbuster Online. Under the platform, Nancy Brill whispered to Simon about this matter.

Blockbuster's second-quarter financial report has not yet been released, but Simon knows that in the first quarter of 1992, Blockbuster's total revenue of $730 million, $61 million in revenue came from late fees, this part Revenue accounts for 8% of total revenue.

In my memory, Besida’s late payment income exceeded 10% of its total revenue. Such a “rich” income is almost equivalent to Besida’s annual net profit. Before the bankruptcy, the video chain giant failed to completely cancel the late payment system.

Even people who do not know how to run a company at all can probably understand that a company that relies on fines to prop up revenue is absolutely abnormal.

Blockbuster certainly understands this, but the company on the original timeline is too big to end up, and at the same time it lacks a strong shareholder, which ultimately leads to staggering in many strategies that should be changed. Not only did it fail to give up completely from beginning to end The late payment system, which is actually full of negative impacts on the enterprise, under the general trend of shifting from physical leasing to online leasing, Blockbuster started a big reversal, completely cutting off the online leasing business that had been done, which eventually led to The world's largest video chain company has disappeared.

Simon thought about this and asked Nancy: "Have you discussed this on the Blockbuster board?"

Nancy nodded and said: "Many people have concerns, and there are problems with franchise chains. Self-operated stores are not a big deal. Franchise chains are probably more reluctant to give up late fees. We cannot expect these franchisees to be too long-term. Vision."

Of the more than 4,300 chain stores of Best Buy, about 20% are franchise chains.

This ratio is also much lower than that of BesTV in Simon's memory.

After the complete control of Blockbuster, with the support of Simon, a very important measure made by the management was to gradually cancel the franchise system and only develop self-operated stores. This is also the number of stores in Blockbuster. The reason for the original timeline.

However, the chain stores that have already joined, Blockbuster cannot immediately cancel the other party's joining qualification.

Moreover, these franchise chains have much higher degrees of freedom of operation than self-operated stores.

For example, late payment, the company's decision to cancel late payment, these franchised stores do not necessarily have to comply with it.

"If you can guarantee that your experimental data is okay, then implement it directly," Simon considered for a moment, and said: "On the board of directors and shareholders, I will help you with it. The franchise store needs you to solve it yourself. However, I suggest that you better not rush overnight and carefully consider a set of reasonable plans."

Nancy nodded and said: "I intend to use this opportunity to further expand the membership system of Blockbuster. In addition, I hope to be able to distinguish Blockbuster's franchise stores from self-operated stores, such as conspicuousness in franchise stores. The location has been added with an'Affiliate' label to distinguish it from self-operated stores. After all, this time Blockbuster Online, franchise stores are also not involved."

The Blockbuster online plan is gradually integrated with Blockbuster's physical stores. If the franchise stores are also drawn into this system, there will inevitably be problems with the distribution of benefits.

"So, if you do this, how do you deal with the dissatisfaction of joining the store?"

"I intend to give them a higher degree of freedom of operation, and at the same time appropriately reduce the franchise fee."

Simon smiled: "Do you want to directly strip these stores out?"

Nancy's delicate and small face was a bit helpless: "Yeah, but it's too difficult."

The divestiture of franchise stores is like abolishing the late payment fee, which is equivalent to giving up a large market share and the company's receivables, which will definitely impact Best Buy's stock price.

The two of them have been whispering in the whole press conference to discuss the blockbuster's cancellation of late fees. Knowing that the press conference ended, Nancy has been with Simon and kept talking about various issues.

Nancy's entanglement inevitably caused some kind of instinctive vigilance for the female assistant who came with Simon.Even Nancy could see the way she wanted to follow Simon's side but worried about being rejected.

Simon finally sent a female assistant to chat with the same C girl Claire who came over today, and then looked at Nancy with a playful expression: "Is it fun to do this?"

Nancy looked up, with a somewhat mischievous smile on her lips: "It's very interesting."

"Be careful, Jenny will wear small shoes for you. You know, men's ears are very soft. She said bad things to you a few times before me, maybe you will lose your job."

Nancy said: "Are you someone who is easily influenced by women?"

Simon nodded seriously and said, "Yes, the more beautiful the woman, the more I can't hold it."

Nancy choked, then rolled her eyes and said, "So, I'm pretty sure that Jenny won't do that."

"why?"

"Since you know that you are easily influenced by women, you will definitely not choose the kind of woman who likes to influence and manipulate you."

Simon thought for a moment, took a glass of sip of red wine, and said: "It seems quite reasonable."

Nancy took another step forward, seemingly planning to make persistent efforts: "So, I guess, are you actually wary of women?"

Simon lowered his head and looked at the young executive in front of him, ignoring the argument she just made, but said: "You have broken through the comfortable distance between me and people."

"Are you feeling sick?"

"No," Simon said in a dangerous tone, and said quietly: "You made me want to hunt."

Nancy and Simon looked at each other, but in less than a second, they stepped back slightly.

The female housekeeper just came over to say hello, breaking the little embarrassment that had just begun.

"What are you talking about?"

"Beshida late payment thing."

Simon said, gazing at Alice in a white professional suit with a clear look.

After the last night, although they met a few times, the two never found a chance to be intimate again.

On the one hand, Simon is indeed a relatively modest person. On the other hand, there are not many women around him, but he can basically see Simon.For example, when she came to San Francisco, the female assistant would not give Simon any chance to steal food.If Janet is in Los Angeles, Simon rarely stays at night.

Simon's eyes fell on him, and Alice inexplicably remembered the man's big hands with a little rough stroke on him that night, and he couldn't help but feel a little uncomfortable, so he turned his attention to Nancy and said, "Speaking, Nan Hope, have you considered the thing I told you?"

Nancy glanced back between Simon and Alice, nodded and said, "I have considered it, but although I also think that this is feasible, if we do so, we may face a class action by the shareholders. Now."

Simon stood by, listening to the two girls saying, "Is there anything I don't know?"

Nancy glanced at Simon and said, "Alice hopes that Best Buy will cancel the video tape sales business online."

Simon immediately understood.

The development of the Amazon online store in the past six months can be described as rapid. Therefore, in addition to books, it is also an example to increase the types of goods.In addition to books, the most suitable type of online sales at this stage is definitely included in the video.

The female butler probably hopes that Blockbuster will cancel the video tape sales business online and avoid competition with the business planned by Amazon's online store.Of course, there should be a corresponding exchange of interests. Amazon can't just let Blockbuster cancel this part of the business.

Although the operating focus of the Blockbuster chain is video tape leasing, it has always been involved in the video tape retail business.

Simon looked at Nancy and asked, "What do you think?"

"I think this is a good suggestion," Nancy said honestly: "Cancel online retailing, Blockbuster and Amazon can conduct mutual promotion cooperation to guide the user base, Blockbuster can also reduce a large portion of retail business expenses . In fact, Simon, I even want to cancel the retail business of the physical chain store in order to make BesTV more focused on leasing. However, this simply does not work."

Late fees may only account for 8% of BesStar's revenue, but video retail sales account for more than 20% of BesStar's total revenue. It is indeed impossible to cut off.

As for Besida Online, this website has just been opened, and online retail is strictly uncertain about its future, and it doesn’t seem to cancel.

It's just that if this is really done, the other shareholders of Blockbuster will certainly be dissatisfied. For the benefit of another company in the Westeros system, which hurts the shareholders of Blockbuster, this can hardly be justified.Therefore, the other shareholders of Blockbuster are likely to file a class action by then.

Running a company, especially such a listed company, often fails to make the most correct decision, and this is the key.

In the final analysis, it was because Simon failed to buy BesTV completely.

If 100% shareholding is achieved, then the boss can do whatever he wants.

Nancy quickly replied: "However, in addition to the cancellation of late fees, I am also considering cutting off some of BesTV's corner business such as movie peripheral sales."

Simon smiled: "This part of your business was originally proposed by yourself."

"Yeah," Nancy did not deny, saying: "However, in recent quarters, after recalculating the cost and return ratio of this part of the business, I think it is better to cut it off and return to the core video retail. It can save a large part of human resources, and it is also more convenient for the management and further expansion of Blockbuster."

After Nancy finished speaking, she glanced at Simon with interest, even with the meaning of whether you should ask me or not.Blockbuster's peripheral products retail, the main sales, in fact, is Daenerys entertainment related film and television peripheral products.

Simon would like to pinch on Nancy's delicate little face: ah hello, remember who your boss is?

It is of course impossible to do this at a well-received reception.

But Nancy realized what she was doing, instinctively shrunk her neck, and then looked at it reluctantly, as if you squeezed, squeezed, and had the ability to squeeze.

Of course Simon would not really do such abrupt things, saying: "As long as you think it is appropriate to make a decision, you can do it. However, Nancy, you need to bear the consequences of the matter. And, don’t forget, You are more of the group president of Daenerys Entertainment's consumer products business."

Nancy paused. Some of the thoughts she just took out were completely dismissed and solemnly said: "I will consider this matter very seriously."

The little child executive suddenly understood.

Peripheral product sales, for Blockbuster, the investment and return ratio may not be too high, and it will increase the labor, procurement and logistics costs of the chain store. However, this can greatly increase the revenue of Daenerys entertainment's peripheral products.

Blockbuster's profit margins in the sales of peripheral products may be very low, but the benefits that Daenerys Entertainment can obtain are very high.

In recent months, Nancy has put too much energy on BesTV, and inevitably neglected her position.In fact, she just talked about this matter, but it was just an immature thought after analyzing the financial reports of BesTV in recent quarters.

If you think about it carefully, she will definitely not rush into it.

Women are always easy to get angry, and under a little shame, Nancy feels that this guy must be in front of him, and he has some small emotions of confrontation.

Yes, it must be.

I am obviously right.