STRATEGIC MANAGEMENT

ACTIVITY #1

Name: Charles Jade C. Angulo DATE: 10-6-22

DIRECTIONS: Read the Mini-Case carefully and answer the question below.

MINI-CASE ON THE KROGER COMPANY

“WHAT AMERICAN COMPANY DOES THE BEST JOB OF STRATEGIC PLANNING?”

 The answer to this question may be Kroger Company. Founded in 1883 and headquartered in
Cincinnati, Ohio, Kroger is one of America’s best companies for effectively formulating,
implementing, and evaluating strategies.

 Kroger manufacturers, processes, and distributes food for sale in its supermarkets, drugstores,
and convenience stores. The company not only owns and operates 325 jewelry stores – it also
owns City Market, Dillons, Food 4 less, Fred Meyer, Frys, Harris Teeter, Jay C. King Soopers, OFC,
Ralphs, and Smiths.

 All total, Kroger operates nearly 2,700 supermarkets, and more than 1,300 of these have fuel
centers.

 Kroger is recognized by Forbes as the most generous company in the United States because it
actively supports hunger relief, breast cancer awareness, the military and their families, and
more than 30,000 schools and grassroots organizations.

 The company also contributes food and funds equal to 200 million meals a year through more
than 100 Feeding America food bank partners. And Kroger does all this very profitably.

 In fact, Kroger dominates the supermarket industry as the largest and most profitable firm.

 Kroger purchased Harris Teeter Supermarkets in 2014.

 Kroger tries every day to help consumers stretch their food budget in a variety of ways,
including weekly promotions and fuel rewards.

 And Kroger continues to make natural and organic foods affordable and accessible to all
customers, especially with Simple Truth.

 The company’s brands (labels) represent about 27.3 percent of total units sold and 25.8 percent
of sales dollars, excluding fuel and pharmacy.

 Kroger appears to be perfectly vertically integrated, owning substantial parts of its supplier,
production, and distribution business network.
  Even the most successful firms, however, are vulnerable strategically.

 Kroger is concerned that two the world’s largest supermarket chains are discussing a merger.
Specifically, Dutch company Royal Ahold NV and Belgium-based Delhaize Group are talking
about combining into one company

 Ahold operates Giant Food Stores in Maryland, Virginia, and Washington, DC, where Kroger
wants to build mor Harris Teeter Supermarkets Inc.

 Ahold also owns Martin’s Food Markets stores in Virginia. Delhaize operates Food Lion in the
South, where Kroger is strong.

 Ahold owns Peapod, an online grocery ordering service that delivers products to customers’
homes or lets them pick up orders at stores.

 Kroger is trying hard to enter the online grocery ordering and customer pickup service.

 Ahold also operates Stop &Shop in New England and the Northeast, where Kroger plans to build
its first stores.

 Delhaize runs Hannaford stores in New England. If Ahold and Delhaize merge, that would create
a company with 2,034 supermarkets in the United States, compared to Kroger’s 2,625 in 34
states, and could result in a more price competitive grocery business.

Questions;

1. Explain why Kroger is recognized by Forbes as one of the first generous companies in America. Is
being generous consistent with (or inconsistent with) being a highly profitable? Discuss.

- In addition to funding more than 30,000 schools and organizations, Kroger promotes
breast cancer awareness, the military and their families, and famine assistance (working
towards development of society). Additionally, via our partnerships with more than 100
food banks throughout America, Kroger helps to provide food and funs for around 200
million meals each year. Any business is obligated to contribute to the development of
society since it uses resources from society and has a responsibility to do so. Company
Social Responsibilities is the term for this (CSR). Even though many businesses
participate in CSR initiatives, very few of them go as far as Kroger. As a result, Forbes
named them as one of America's most charitable corporations. When your revenues are
good, you often allocate more money to CSR initiatives, and the opposite is also true.
Responsibility and desire to do so are involved here. So, being generous and being
extremely successful are compatible.

2. Which supermarket do you shop most often and why?

- I like natural and organic foods since they help me stay active and healthy. Kroger is
my first option since it sells natural and organic goods at reasonable costs.
 Additionally, the weekly discounts and fuel incentives enable me to reduce my
monthly spending on food and petrol.

3. What are the three most important criteria that determine in which supermarket you shop?
Does Kroger meet your criteria?

- The three elements that control businesses and purchasing criteria are as follows: i.
Quality - The first thing that all buyers consider is the quality of the items that the
businesses offer. Nobody enjoys using or consuming a product that is of poor quality
or is faulty in some way. Products of poor quality or defects might cause harm or
disease, neither of which you want. Ii. Cost - Offering high-quality goods at
competitive prices will draw clients to a certain business and foster customer
loyalty. Iii. Accessibility - Customers buy all they need from convenience or food
stores or outlets in quantity. Therefore, these should be close to the consumers or
at a location that is simple for the customers to go to. Many clients would also like
the option of placing an order online and picking it up later. Kroger satisfies my
requirements in terms of quality, price, and outlet location. However, Kroger does
not use an online ordering system, which would enable me to pick up my orders on
the fly.

4. What response would be appropriate for Kroger if Ahold and Delhaize merge?

- The combination of Ahold and Delhaize shouldn't cause Kroger any issues because it
currently operates a significantly greater number of stores than Ahold and Delhaize
put together. To have the advantage over the merger, Kroger has to join the online
ordering system as soon as feasible. Another reason why Kroger needn't worry is
that devoted consumers won't readily move to other suppliers if they receive high-
quality goods at reasonable prices and help them save money.

5. Go to the website www.finance,yahoo.com, put in KR as the stock symbol, and then check on
Profile, Statistics, Competitors, and Headlines. Determine whether Kroger has continued its
fantastic performance lately. Use this website, among others, throughout this course to gather
research about companies.

- The Kroger Co. is still one of the revenues in the market but As I can see on the
summary, the value has been reduced to 44 and it still continue to reduce as of now
just like other crypto currencies.

6. Determine form the www.finance.com website who are Kroger’s two primary competitors and
how is Kroger performing versus those rival companies?

- The two primary competitors of Kroger are Costco and Whole Foods Market. Based
on their cost structure, Kroger competes as a low cost provider that can offer goods
for comparatively less money while still making a profit. This is supported by a
marketing tactic that puts the consumer first.