GAP ANALYSIS Sources of gaps Types of gaps

GAP ANALYSIS Sources of gaps Types of gaps Solutions to gaps BSAD 113 GAP ANALYSIS Lars Perner, Instructor 1

Gaps Sources n Types Environmental w Legal w Infrastructure w Cost n n n Demand-side Supply-side Managerial w Policies due to n n BSAD 113 Distrust Poor integration GAP ANALYSIS Lars Perner, Instructor 2

Demand Side Gaps Service output supplied= output demanded n SOS < SOD w Segment currently receives insufficient service w E. g. , supermarkets not delivering groceries w E. g. , same day delivery of specialty books BSAD 113 GAP ANALYSIS n SOS > SOD w Excessive service excessive prices for any significant segment w “Wheel of Retailing”— stores keep adding services and lower priced alternatives then emerge w Where to draw the line—e. g. , Costco Lars Perner, Instructor 3

Supply-Side Gaps Total cost of performing all flows is higher than needed n n BSAD 113 E. g. , travel agents E. g. , neighborhood pharmacies GAP ANALYSIS Lars Perner, Instructor 4

Combined Gaps Cost/ Performance SOD>SOS SOD = SOS SOD < SOS No supply side gap (efficient) Room for No gap higher price, more SO Room for lower price, less SO Supply side gap (excess cost) Too low SO value at too demanded high cost even at high cost Insufficient value BSAD 113 GAP ANALYSIS Lars Perner, Instructor 5

Closing Demand-Side Gaps Multiple, multi-tiered services to different segments (e. g. , Marriott and Courtyard) Adjusting current offering toward market balance Reconsider target market BSAD 113 GAP ANALYSIS Lars Perner, Instructor 6

Closing Supply-Side Gaps Changing channel flow objectives Investments in efficiency Improvement of existing channel BSAD 113 GAP ANALYSIS Lars Perner, Instructor 7