Publix Supermarkets Essay Example for Free

Publix Supermarkets Essay The factors that are currently involved in successfully competing in the supermarket industry are the same factors that have led to the success of Publix supermarkets. These factors include delivering superior customer value, caring for people, and delivering quality products and service. Publix has gone a step further and developed four success drivers for the company; knowing the business, knowing the product, knowing the customer, and continuously training people. Due to the fact that customers are more knowledgeable and demanding than ever before, change is constant throughout the supermarket industry. As a result, to remain competitive for the next 10 years and beyond, knowing what customers need and being able to meet those needs is be critical. For example, as the population becomes more diverse, there will be a greater demand for various ethnic food products. Similarly, as health and nutrition become more of a national focus, there will be a greater demand for high quality foods that are rich in nutrition, as well as organic products, etc. In addition, technology such as self checkout stations in supermarkets and online shopping capability will continue to change the landscape of the supermarket industry. What are the values of Publix’s organizational culture; employees; customers; shareholders; suppliers; and competitors? Which ones do you consider to be value adders and which do you see as value destroyers as Publix attempts to become the premier quality food retailer in America? Publix has a corporate culture founded on the philosophy of deeply caring for people. Publix employees understand that they are not only in the grocery business, but also in the people business. As a result, taking care of associates, customers, suppliers, and others in the community is a priority. The result of Publix employees continue to please their customers, more customers look to Publix for their shopping needs. At the same time, employees and associates are made to feel valuable through recognition programs, extensive training programs, etc. Publix believes that their employees will not have the ability to make customers happy if they are not happy themselves. By investing in their employees, Publix has created a culture of loyalty, pride, and job satisfaction. By making a commitment to people and creating lasting relationships with employees, customers, suppliers, and the community, Publix has positioned itself as an industry leader. This philosophy and corporate culture play a large role in the success of the company and can only be considered as value adders, not value destroyers. What factors are currently influencing a customer’s decision to shop at Publix? Why have competitors been unable to duplicate such success factors successfully? Publix’s mission statement very clearly states that Publix is passionately focused on customer value. Essentially, the company is just committed to satisfying the needs of its customers better than its competitors. While the competition is able to offer good prices and quality products, Publix stands out in the minds of its customers for providing delightful customer service in every shopping experience. There is no doubt that Publix needs to maintain competitive prices and quality products in order to be successful. However, these are easily duplicated. On the other hand, providing a delightful customer experience comes from the culture of an organization committed to creating superior value. This is what sets Publix apart from its competitors. Analyze how PublixDirect’s processes were used to add value. In hindsight, what should the company have done differently to keep PublixDirect a viable business model? PublixDirect’s business model sought to add value by utilizing a centralized direct fill fulfillment approach. In addition, PublixDirect was limited to a 35-mile radius in South Florida. The company utilized a 140,000 square foot distribution center divided into separate departments, and operated its own bakery dedicated to the online venture. The company utilized the latest technology for order taking and fulfillment, outbound logistics, and payment. PublixDirect was founded on the same philosophy as Publix supermarkets with the goal of delivering superior customer value. The goal was to offer customers a convenient alternative to traditional grocery shopping with prices similar to that of local supermarkets while offering superior product quality and customer service. Unfortunately, PublixDirect was unable to sustain operations. Initially, the business model appeared as though it would be successful, but that proved not to be the case. In hindsight, the company should have done more extensive research about its potential customers, and done more to attract the type of consumers originally targeted which were dual income households with incomes exceeding $75,000. What were the factors that led to the demise of PublixDirect? What does it take to create a successful online operation in the United States? High delivery costs, distribution center costs, and low customer demand were all factors that contributed to the demise of the PublixDirect operation. To date, none of the various online gorecery operations I ntroduced in the United states have been able to turn a profit, and therefore none have been able to sustain operation long term. However, the primary problem seems to be the inability to turn profits due to the high costs associated with distribution centers. In order to create a successful online grocery operation here I n the United States, it would be best to follow the same model that U. K. based Tesco has successfully implemented. Rather than utilize distribution centers for order fulfillment, Tesco uses a â€Å"store-pick† model in which orders placed online are simply picked from store shelves. Delivery costs are added to the cost of the groceries. This model has proven to be successful in the United Kingdom and could very well be successfully implemented here in the United States as well. The warehouse/distribution center model has the potential to be cheaper long-term, but the large up-front costs have proven to be enough to put several online grocers out of business before they were able to turn profits.