Superior Supermarkets. “Everyday Low Pricing”

We have all been to a supermarket or store at some point in our lives. Have we found ourselves placing items in the cart that we did not come to buy, and why is that? Is there a reason the products we need are located in the back of the store? Marion Nestle wrote an article entitled, “The Supermarket: Prime Real Estate.” She teaches in the department of nutrition and food studies at New York University. Nestle writes a column regarding food for the San Francisco Chronicle. Shortly after reading the title, one can determine Nestle opposes supermarkets. “Prime Real Estate,” indicates that large supermarkets are feeding grounds for them against unsuspecting customers. Supermarkets can determine what somebody will buy, based on where the store places certain products. The general argument made by Nestle in her work, “The Supermarket: Prime Real Estate, is that supermarkets are taking advantage of our unconscious mind and we are purchasing products on impulse.

In order to address such problem, the company may opt to offer discounts in certain time of the day to boost the sales of its bread. For instance the bakeshop may provide 50% discount on its baked goods when stores are about to close. In doing so, it will not only reduce the spoilage of the bakeshop, but would also broaden the appeal of the bakery-café to a bigger market. The discount serves as a tool to segment the market that the company is catering into, and thus be able to maximize the sales per target market.

Trader Joe’s is in the broad market of grocery retailers, a market where the top 10 revenue-generating companies accounted for over $360 billion in sales in 2011. This market is saturated with supermarkets (Publix and Kroger), large discount retailers (Wal-Mart and Target), premium retailers (Whole Foods and Fresh Market), warehouse clubs (Costco and Sam’s Club), and “hard discount” retailers (Dollar General). With this large variation in grocer strategies, the market is heavily penetrated and competition is fierce. Supermarkets are continually losing market share in grocery sales (51 percent in 2011 as opposed to 66 percent in 2001) as players like Wal-Mart and Costco continue to generate more revenue. Although the supermarket share is decreasing, the overall grocery market is steadily increasing as the population of the United States increases. People always need to eat, so there will always be a

Wal-Mart founded in 1962 by Sam Walton is now the largest American retail corporation. With thousands of chains of stores and warehouses Wal-Mart monopolized the American retail industry. In addition, Wal-Mart is the second largest retail corporation in the world employing of two million employees world-wide. As one of the most valuable corporations in the world Wal-Mart continues to improve their sales annually while offering some of the lowest prices available. Wal-Mart’s famous low price guarantee, come at a high expense of the environment, the small businesses, education, the rights and safety of the consumer, but most importantly their employees. Although Wal-Mart has plays a dominate role in American economy, this “American”

Whenever I go to Stop & Shop, I tend to take interest in the thousands of products that surround me as I walk down an aisle. The wafting aroma of freshly baked pastries and the sight of cold soft drinks are just some of the things that trigger my appetite for food. Most often, I find myself buying more than what I originally planned on. That’s exactly what the layout of a supermarket tries to make consumers do. Marion Nestle argues in her article, “The Supermarket: Prime Real Estate”, how supermarkets employ clever tactics such as product layout in order to make consumers spend as much money as possible. She covers fundamental rules that stores employ in order to keep customers in aisles for the longest time, a series of cognitive studies that stores perform on customers, and examples of how supermarkets encourage customers to buy more product. Overall, Nestle’s insight into how supermarkets manipulate people into spending extra money has made me a more savvy consumer and I feel if more people were to read her article, then they can avoid some of the supermarket’s marketing tactics as well.

Low pricing eventually results in loss of customer loyalty as pricing to bottom is a risky business strategy.

All segments are critical for the implementation of our company’s strategy because we chose to be broad cost leaders. Cost leaders maintain a presence in all market segments by focusing on low production costs and competitive pricing. With that in mind, one segment is considered to be slightly more important than the others: the low end segment. We will compete in every market segment, but this is one of the most important due to the fact that price is the main consideration of the buying criteria at 53% importance. Our costs will be much lower than our competitors which translates into a lower market price for this product, which is ideal for our customers.

Company records point out fresh meat, poultry, and seafood to be among the items people in Centralia spend the most money on. This representative 14.32% average plus the fact that meat quality is the second most important determinant of store choice can be seen as an attractive opportunity for Hi-Value executives to improve the quality of their butcher in order to attract more customers. Another opportunity for Hi-Value is to modernize their store to make it more attractive and easier for customers to maneuver around to make their shopping experience better. It may not be a bad idea as well to offer a greater variety of bakery choices along with fresher produce.

Whole Foods is a great example of democratic approach to store operation. In this organizational environment all team members have the ability to insert their input in decision making that affects their product/service area in addition to having input in store matters as well. Whole Foods has a stringent screening process potential employees are put through to ensure that the applicant is a good fit for the organization. Once an applicant is hired, they are assigned to a team and team leader, who then train the new team member to be knowledgeable on the product/service they are assigned to. Additionally, they are also trained on providing friendly customer service. Due to Whole Foods approach to using workplace democracy, it has created a positive

Cole expects to establish more and bigger stores and supermarkets in order to improve its competitive edge among its leading competitors such asWoolworths. According to the situation analysis, the “down down” price strategy appears to stay since for many years, it has acted as its competitive edge. Hence, the low price strategy will assist the company in competing for the customers ( Mckeown, 2012).

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.

The VP of Operations has suggested a 20% decrease in price to better compete with the mass merchants who are gaining a

In 1996 sales to this class of customer at a 30% markup represents $11,975,040 margin for Tweeter, $16,917,120 margin for Lechmere and $13,258,080 margin for Circuit City. This is an important source of margin for the Superstores, however represents only 10% and 15% of their overall sales respectively. So I believe that they will fight to keep their customers rather than fight to gain

The second pricing strategy is the penetration pricing where the product enters newly into the market. To gain some consumer base from the competitors, the seller initially charges a lower price than the competitors. For example the ticket prices initially charged for IPL, Indian Premier League, matches were lower than the ticket price of the competition ICL matches. On the contrary, price skimming strategy is to grab the financially top class of the market and to do this, the seller charges high prices. The effectiveness of this strategy is based upon

Customers influence Wal-Mart by buying their products. However, Wal-Mart doesn’t provide arm security on the parking lots which has cause to many incidences such as shooting, raping and kidnapping.