REED SUPERMARKETS: A

NEW WAVE OF
COMPETITORS

Submitted by:
Prajna Alva 13728
Pranesh Guptha 13729
Prerna Saluja13730
Rahul R M 13733
Roshan 13735
Sai Kumar 13736
Shagun Tibrewal 13740
Pranesh 13729
Prerna 13730
Rahul R M 13733
Roshan 13735

competence. People are becoming more price sensitive and moving to retail outlets with lower prices.  Quality Quality depends on the brands that a retail store houses. Warehouse stores offer prices upto 20% lower than the conventional supermarkets. security. communication. In terms of perishables it is more important to maintain high quality standards. The two major components of an assortment strategy are the depth of products offered (how many variations of a particular product a store carries). tangibles and understanding/knowing the customer  Product assortment This dimension considers the different product categories the retail format has along with the number of SKUs. The quality standards that are maintained at the retail stores offer an advantage. and the width of the product variety (how many different types of products a store carries). Store formats like Dollar stores.  Location People preferred stores within 1-3 mile of the radius as it offered convenience of shopping.  Level of service Service level varies greatly in different formats of retail. courtesy. credibility. responsiveness. It is defined on the dimensions such as access.1) What are the main dimensions of competition in the Columbus Ohio Supermarket? The main dimensions of competition are:  Price Price is an important consideration factor when people shop. They offer no frills services. But during difficult times consumer tend to opt value over convenience . reliability.

3) What explains Reed's success? The Success factors of Reed Supermarkets are contributed to various factors. Since the store is being operational for more than 80 years.2) Where are the competitors clustered along these dimensions? Competitors Product Service Prices Size Average 170. distribution and marketing of its products. it has various advantages in terms of purchasing.   The product quality offered by Reed supermarkets are of great standards and it has special emphasis on organic produce. . And switching of retail stores also occur with Warehouses and Dollar stores becoming preferred shopping destination. Please find the details below.000 SKU Assortment Walmart/Target Broad and Limited Deep Costco/Sam’s Broad and No Shallow frills Low(up low 100- to 20%) 150. Therefore it shoes Price is the most important factor and hence cannot be ignored. Factors like value become more important than convenience.000 Low 7000- 20000 service Dollar Stores Narrow and Limited Shallow Aldi/ Trader Joe Narrow and Modest 10000 Low Shallow- 8000- 1500- 12000 Specialty Mainly and Privately Imported labeled items brands Majorly the market is divided on the basis of Prices During recession people become price sensitive.

then the customers spending capability will decrease and hence they will begin to shift to other alternatives. greeters offered free cookies to customers on the weekend. From the exhibits on price index.  Another threat might be the fact that there is no proper coordination or consensus among the top management on what strategy needs to be implemented to ensure market share growth. As we know that there is an increase in the health conscious customers. healthy food supported by their specialization in organic and seafood category. the checkout clerks wore distinctive red aprons. Hence their strength was getting a better base for High income consumers. As we know that the percentage of healthy conscious people is increasing in the recent past. it is considered as high end in the Super market business. . It had attractive stores.  Another threat to the success of Reed supermarket would be linked to Economic downturn. 4) What threatens Reed's success?  The major threat for Reed supermarkets is the diminishing market share in Columbia. elegant serving case displays. the threat of new entrants is medium as huge investments is required to match the number of stores that are being currently offered by Reed supermarkets. and exceptionally attentive customer service. Reed supermarkets had top class excellence in terms of store management which is difficult for its competitors to replicate. This ensured that proper service is being offered to its customers so that they become loyal to the store. This might impact Reed supermarkets as there would be a dip in the market share for them. according to Porter’s five force model. high staffing levels ensured shorter checkout times and runners shuttled bags to customer’s cars. The increasing number of dollar stores and limited selection stores are a major concern as they take away the market share from Reed Supermarkets. Once the recession is high. we could see that Reed has a lower value as compared to Aldi and Dollar stores. Moreover.  Lack of private labels may be another threat and this could be minimised by introducing more private labels and by having a new category of organic and natural foods which in turn will be helpful in increasing the consumer base.  Among the existing customers. The bargaining power of buyers is also low because the quality offered by the supermarket is of very high level. Analysing the success or strengths. 5) Is it necessary for Reed's to reposition itself? Why or why not?  The primary focus of Reed supermarkets are high end customers and Healthy concern customers.    Because of its higher quality products and the price of its products. those who below to the lower margin might be price sensitive and thus could shift from Reed supermarkets to others such as dollar stores or Aldi where the prices are low comparatively. Customer loyalty plays a crucial role in determining the success of a particular store. they would like to purchase products that are of this quality levels. this shows a better signal for the supermarket. Long hours. Reed supermarkets address the needs of the above mentioned customers by providing natural.

       Currently. current pricing strategy should be followed by them in the future as well. Hence. Hence. These funds could be used to realign Reed and its customers with the strengths of Reed. we believe that Reed supermarkets should maintain the current product position of offering high quality organic and natural products and maintain its high levels of customer satisfaction by providing efficient and adequate customer service. with having 25 stores in the Columbia locality. 3 2 2 2 2 2 BBMK CRMT4 DTMT2 DGMK4 RISK ITCO sb . Collins should also try to allocate more budgets for marketing purposes. Hence. In order to improve the level of store management. Store layout also plays a crucial role in store management. They should stop the dollar special program as this is not consistent with the brand positioning of Reed. Reed supermarkets can go ahead and increase the private label and also provide seasonal gifts to its customers to increase the customer loyalty towards this brand. It is increased further by providing a one stop shopping point by offering full range of products. special training and development programs can be provided to the employees to increase the customer satisfaction levels. they should not go ahead in decreasing the price of its products due to the prices in various other stores such as dollar or Aldi. the customers would feel convenient in reaching the stores and getting the products.