Hi Value Case

Operating on very thin profit margins, players in the supermarket industry traditionally either focus on a premium segment or follow a discounter strategy at the low end. Premium players address educated and more price elastic consumers who value healthy, natural and organic food; the share of perishable items for these players is normally distinctly higher. Players that focus on a discounter strategy offer a higher share of simple necessity items and value price competitiveness over premium features like healthiness or organic origin. Independently of the focused customer group it is imperative for players in the supermarket industry to be cost efficient and optimize operations

While many consum¬ers will still pay for premium products, super¬markets have had to slash prices on many ordinary items. Part of the reason for this is the fierce competition they have been receiv¬ing from such outlets as warehouse clubs. Folgers is a very well-known brand, but not even the stron¬gest brands are safe from the necessity of price-cutting, to which they were formerly immune. In bygone days, owning a strong brand was a sure road to protected high margins. Low-cost generic products have improved in quality and their sales have skyrocketed, making such moves unavoidable.

Grocery shopping is more diversified and evolved than ever before. Individuals across the nation have access to everything from exotic products to unique delivery services. Often, specialty stores have limited locations whereas specialty services have a limited reach. However, two retailers have expanded to hundreds of locations while adhering to unexpected market positioning for previously untargeted market segments. Whole Foods Market and Trader Joe’s have become household names while also innovating beyond regional and national traditional chains. Despite comparable size in

Teoh case is a notable case between Minister of State for Immigration and Ethnic Affairs and Ah Hin Teoh, which shows the position of Australia when ratified an international convention. It concerns on administrative decision which was made contrary to the Convention on the Rights of the Child (CRC) ratified by Australia. In this case, Teoh alleged that the Minister delegate had disregard the provisions of CRC, particularly Article 3.1. of CRC, when refused his application for grant permanent status and consequently issued deportation decision to him. Finally, the High Court of Australia (by majority) decided that the two administrative decisions be set aside.

In 1975, Hi-Value Supermarkets became a division of Hall Consolidated, a privately owned wholesale and retail food distributor. In 2002, Hi-Value had sales of $192.2 million, which was the smallest out of the three supermarket chains owned by Hall Consolidated. Although Hi-Value is considered small against industry standards, they were the number one or two ranked supermarket chain in each of its trade markets measured through market share. The primary problem that Hi-Value has developed is that they are the highest priced compared to the competitors within the region. The Hi-Value Supermarket Shopper Interview Results (Exhibit 7 in case) demonstrates this through the question “Liked most about other regular store,” the most popular answer across the board was “Price.” So what is Hi-Value supposed to do?

Hi-Value is known as “most convenient”, having three stores in Centralia compared to its top competitors only having one each. Hi- Values three

Nevertheless, the majority of customers are very satisfied with the amount of serving along with the quality of their meal as well as the price paid. The strategy of being a low priced high value added has seen problems due to lack of customers which is affecting the bottom line drastically. This inevitable circumstance has put a hold on operations and started an investigation upon various neighboring competitors and their own strategies.

Potential entry of new competitors is rendered low for the grocery retailing industry. Puregold, SM Hypermarkets, Rustans, and Robinsons Supermarkets are amongst the top key players in the game. The entry of new competitors could be very low because of the huge capitalization funds that this industry requires. In addition, the industry has been long time dominated by the giant players that had already well established and positioned their brands throughout the country and that they had already spread out with branches in Metro Manila and other regions.

Another component can be found in the requirement to convince the supermarkets to give up valuable freezer space to dog food. Freezer space is a high value commodity; giving up such space to a product that has a potentially small market in lieu of using the space for products for the wider

Specialty grocery stores have grown in attractiveness to customers, but the main issue is that often specialty stores have restricted locations which in turn limits their reach to customers. Whole Food’s Market and Trader Joe’s are two specialty grocery stores who have increased locations to the hundreds while adhering to an unforeseen market standing for formerly untargeted market segment.

These four retailers average private-label dollar share of 22%, well above the industry average of 16%. They have also seen higher levels of overall sales growth versus non-leaders – 5.3% versus 3.4% over the past 3 years. (Future of Food Retailing 2008, 136)

The SM Investment Group owns 40 malls nation-wide, and is still currently expanding not only their shopping malls but also their supermarket chains. SM Retail, Inc. is a significant player in both fashion and food segments. The multi-awarded The SM Store (formerly SM Department Store), which has close to 50 stores strategically located in key cities throughout the country, carries a wide range of apparel, accessories, houseware, general merchandise and lifestyle products. In food retail, SM has three store formats, SM Supermarket, SM Hypermarket and Savemore that offer products and services which focus on quality, affordability and

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

To provide quality product, extensive menu of delicious foods, ensure customer awareness and loyalty and also have good publicity.

Stores like Wal-Mart are famous for keeping their prices so low. This is one reason why they are able to maintain a grip on the consumers of an area. They accomplish this by keeping the cost to produce and transport the goods low. In January, a study by the Los Angeles County Economic Development Corp. found that, “an individual family could save $589 a year on groceries by shopping at a supercenter. Overall, shoppers could save $3.76 billion in merchandise nationwide.” (Blazier, A, 2004) A major reason they can keep prices lower than mom-and-pop run businesses is their ability to buy merchandise in bulk. Buying in bulk works the same way it does for a consumer. The more of a product that is purchased, the less the cost is per unit. Consumers see this every day when they go to stores like Sam’s Club or Costco. When they buy their merchandise in bulk, they are able to offer it to the consumer at a lower price. (Kale, 2011) This is what could eventually drive the mom-and-pop owned businesses out of the area, and draw a negative criticism from the public. The interesting thing about this criticism is that the public complains about Wal-Mart