Frito-Lay/Cracker Jacks Case Analysis

2325 Words Oct 7th, 2010 10 Pages
Organizational Culture and Globalization

Stanley Brett Yunker

Davenport University

MGMT 735

Professor Andrew Makar

October 18th, 2010 Case Recap Superior Supermarkets (SS) is a division of Hall Consolidated, a privately owned wholesale and retail food distributor. SS is the smallest of three chains which caters to the South Central United States and is ranked either No. 1 or No. 2 in each of its markets. SS has been considering an ‘Everyday Low Prices’ strategy for many years. It is felt by due lower than expected sales based on budget targets, that revisiting the issue of a new pricing strategy is warranted. A management meeting is scheduled to discuss this matter and a decision is expected on this topic.
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Superior Supermarkets is in need of a strategic program to help fuel continued growth, market share, and profitability. The current issue of a new pricing strategy is warranted, considering competitive forces, increasing consumer price consciousness, and recent sales being below budget. Table 3 illustrates how SS compares to its competition in terms of product distribution – a lower percentage of grocery and higher percentage of meats and produce. This table also depicts that lower percentage of sales exist for high profit margin items. This information can be supplemented by recent consumer research carried out through telephone surveys and two focus groups. Critical assessment of Superior Supermarket’s current pricing practices, recent consumer research, competitor behavior, and a SWOT analysis can give credence to a more effective pricing strategy and help assess whether a ‘Everyday Low Prices’ strategy is justifiable.

Identifying the Root Problem Components Superior Supermarkets has experienced lower sales over the last two quarters and aware of increasing competitive forces from three other chains that have stores in two of its Centralia territories. Historically, Superior Supermarkets has priced itself on the higher end, delivering products that it

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