1. Identify the relevant macroeconomic factors in the case study. What impact do these have on the focal organization? Globalization Due to globalization many retail firms are looking out for opportunities to venture into businesses outside the borders of their home country. In this front thought the number of US firms retail firms entering into the global market is relatively less; there are a number of foreign firms which are coming into the US to establish their businesses.
Impact: The entry of multinational firms can create both opportunities and threats for Publix. Threats: The entry of more multinational retail giants into the US market will make the market more competitive. This could ultimately affect the market share of the US firms such as Publix. There is a possibility that multinational firms might take the route of acquisition to enter into the US market. This could be threat to the existence of companies such as Publix which might be acquired by multinationals.
Opportunities: Publix could also take it as an opportunity by the way of entering into joint ventures with the global firms to establish its presence throughout the United States (as currently, Publix is mainly dominant in the south western states of the US). Publix may also go global by expanding its business in other countries as Wal-Mart did. Technological Technological advances have resulted in more and more new products being launched into the market every year. On an average, 20,000 new items enter the market annually.
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It is important for Publix to identify which of these products best meet the needs of its customers and provide the necessary products to its customers. Impact of new product launches on Publix: Let us say that Publix fails to identify certain new products which are wanted by some of its customers. In case Publix fails to identify such a product, and some other firm does and supplies it to its customers, then there is a chance that Publix might lose some of its customers to its competitor. The new technology now offers the customers to have an option of self checkout.
Some of the firms in the industry are adopting to this technology to cater to the customers who have time constraints and are willing to use debit card for grocery shopping. Impact: Publix could implement such a technology in its stores owing to the increasing demand of such technology from its customers. If it does then it might lose out on its core competency of maintaining customer intimacy. Socio-cultural The needs of an average person are changing these days, with a vast majority of people preferring prepared foods over cooking.
Impact: This effectively means that more people who visit the grocer would want to purchase prepared foods rather than buying ingredients used for cooking. So Publix will have to manage its inventory according to the changing demands of its customers. Unlike the yester years where only a few people were interested in organic foods, today increasing numbers of customers are becoming more and more health conscious. This has lead to a boom in the organic foods sector with some of the major firms acquiring small organic food manufacturing firms.
Impact: Similar to the previous case, the needs of the customers are changing and this necessitates Publix to find the right product to offer its customers to keep them not only satisfied but also delighted! 2. Discuss the market factors in the case study. How do collaboration, competition, supplier, and regulators affect the performance of the focal organization? Collaboration Publix believes in the concept of collaborating with the customer to understand the customer needs. The needs of the customers keep changing and it is very important for Publix to understand what those needs are.
Moreover, each customer is unique and different customers have different needs. Publix aims to understand the needs of the customers through collaboration with the customers. This is one of their main success strategies. Competition Publix has many competitors in its grocery business. From the retail giant Wal-Mart to local grocery shops; with the advent of globalization it is now facing competition even from foreign firms that are establishing themselves in the United States. Publix aims to satisfy its customer better than its competitors.
Because it believes that if it satisfies its customers better than its competitors then there is no reason for its customers to go to its competitors. It accomplishes this by its constant quest of finding out the needs of its customers better than its competitor and then satisfying those needs. Suppliers With increasing number of products being launched every year, it becomes very important for the grocery stores to keep track of all the new products entering into the market by maintaining good relations with the suppliers. It is very essential to identify the right product from the right supplier to best satisfy the customer.
Regulators Due to food safety becoming one of the major source of concern in the grocery industry, many bodies are starting to have a regulatory effect on the grocery industry. Impact: Being one among the market leaders in the industry, Publix needs to be proactive in not only meeting the required regulatory standards of food safety but it also has the obligation to set the industry standards for food safety. References Bahaudin, G. M & Erica, Franklin. (2007). A Retailer's Steady Growth Strategy: Should Publix Stay National Or Go Global? Journal of Business Case Studies, Volume 3, Number 4, 23-32.
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