This is a great post that has me thinking about how RTR could implement operational efficiencies without significantly raising its costs. You mentioned that stains introduced variability and bottlenecks into their process. The most obvious way to solve this issue is to hire more trained spotters who can quickly identify the type of stain and treat it. However, not only are individuals with this skill set hard to find but presumably hiring them would increase the company’s labor costs. Perhaps the company could incorporate an incentive for customers to return dresses in perfect condition (ex. those who return dresses in perfect condition get a portion of their rental costs reimbursed).
Great post! Something you highlighted was that Chipotle has designed its operating model such that its throughput and cycle times (1 hour/300 “dishes sold” or “people served”) are very low relative to its other competitors. While its operational efficiencies allow Chipotle to quickly serve customers, I wonder how the customer experience is impacted over time. Do customers seeking better customer service (more time to deliberate and ask employees questions about food options) avoid Chipotle? What is the potential impact on revenues (both negative and positive) of an operating model with extremely low cycle times? Ultimately, do low cycle times have negative impacts on customer service? All questions I would want to explore.
This post highlighted a very interesting observation. The way in which you manage the production process for a luxury item is markedly different from the way in which you manage the production process for other low-cost goods. The process of producing a bag is extremely labor-intensive, resulting in longer throughput and cycle times (given one employee may spend 15 hours creating a bag). While this may be a liability in other industries, this may be an asset for Hermes. Its limited distribution channels and lower cycle times (relative to its competitors) generate excess demand for its products and increase both the exclusivity and reputation of its brand.