Case Analysis - Reed Supermarkets Essay

947 Words Jun 19th, 2013 4 Pages
Case Analysis: Reed Supermarkets: A New Wave of Competitor

Introduction & Problem Definition
This case involves a mid-sized, regional grocery store chain called Reed Supermarkets. Reed has 192 retail stores, two regional distribution centers and 21,000 employees in five states in the Midwest of the United States. This case discusses Reed’s market strategy for the Columbus, Ohio, market in particular, which is one of Reed’s largest markets. The Columbus market has grown slightly over the past five years, while Reed’s market share has dwindled slightly in the market. Reed has watched their market share stagnate with the entrance of new competitors (10% growth in stores) and a dramatic shift in customer preferences to value or
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Columbus’ median household income is also higher than the state of Ohio’s average. Reed’s position within in the Columbus is strong. In the past year, Reed held highest portion of the market at 14%. This market share has declined somewhat over the past five years, but held steady in each of the past two years.
Internal
Reed Supermarkets started out as a lower-end retailer, but over the past two decades Reed has moved into the high-end in the supermarket business. They have done this with a combination of exceptional customer service, a full assortment of both standard and high-end products, including bakeries, meats and seafood. This niche has been very successful and been the diving force in their growth. Unfortunately, as noted above, customer loyalty to a quality brand has dwindled and been replaced y the need to find the best price. Reed has attempted to combat this by both increasing their high-margin products (private label and prepared foods) and increasing the number and amount of specials they offer. These tactics have done little to change customers’ perception of Reed as a high-end and high-priced retailer. See Appendix A for a full SWOT analysis on HLL.
Alternative Courses of Action
Reed’s executives have put forth three alternatives to increase revenues in the Columbus market. The first is to continue with their

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