Winn-Dixie BenchmarkingEssay Preview: Winn-Dixie BenchmarkingReport this essayWinn-Dixie Benchmarking WorksheetTask A: Problem/Opportunity StatementInstructions for Task A: In the Response row, write out the problem/opportunity statements for the scenario for each of the team members.Response to Task A:Winn-Dixie can regain its position as one of the market leaders in the grocery retail industry, win back customers, and also gain new customers by:Re-evaluating and implementing an advanced store location strategy nationwide as opposed to only regionallyRe-evaluating and implementing a pricing strategy to be more competitive in the industryImplementing more brand name products in which customers will have a variety of items to select from.Providing bonuses and monthly incentives to employees to aid in increasing employee productivity and moraleRe-evaluating and implementing an advanced store by expanding its accessibility.Task B1: Generic Benchmarking: TopicsInstructions for Task B1: In the Response row, identify the topics for which you need information in order to identify potential solutions to the problems identified in Task A.
In the Response row, list three to five topics that you will research in peer-reviewed journals, on Web sites, and in popular publications such as magazines and newspapers.
In the Response row, provide a justification for each topic.Response to Task B1:Topic 1: Finding the Right Location for Your BusinessIn the case of Winn-Dixie, locations are somewhat limited being that they are only found in the southeast portion of the United States and some portions of the Bahamas as well. Choice of location is also imperative for any business to attain a profitable end-year result year after year. This is especially important when operating on a regional basis as competition is already nationally established and is expanding globally. Winn-Dixies limitations in location pretty much place a cap on their profit potential. A suggestive solution to help Winn-Dixie regain a name in the grocery industry is to implement a plan similar to that of Wal-Marts and branch operations into different types of stores (express locations, mini-marts, etc). This will in turn give Winn-Dixie a competitive edge by locating these different stores in a method similar to their competition, Wal-Mart, who happens to be a company that benefits tremendously from the money issues that Winn-Dixie faces currently.
Topic 2: Competitive Pricing StrategyWhen pricing, Winn-Dixie must take into account the competitive and legal environment in which the company operates. From a competitive standpoint, Winn-Dixie must consider the implications of its pricing on the pricing decisions of its competitors. Winn-Dixie should use the penetration pricing strategy. With this strategy, the company offers new products at low prices in the hope of achieving a large sales volume. Penetration pricing requires more extensive planning because the company must gear up for mass production and marketing. Penetration pricing has two advantages. First, the low initial price may induce consumers to switch brands or companies. Second, penetration pricing may discourage competitors from entering the market. Their cost would tend to be higher, so they would need to sell more at the same price to break even.
Practical applications
The most obvious use of the Penetration pricing strategy is as a framework for assessing the competition for a product. An important point to note is that the pricing structure of Winn-Dixie, particularly the penetration pricing, was established by the original price, and changes since then are sometimes left to chance.
An important point to note is that Winn-Dixie is not alone with its pricing strategy. A number of companies are planning and implementing a similar strategy for retail, wholesale and online retail. As of September 2011, the largest retailer by sales volume, Staples, had plans for an “unified” pricing structure based on the same competitive pricing model developed by Wal-Mart and Walmart. These plans included an integrated third-party pricing and warehousing model. Wal-Mart’s plan, which it unveiled in November 2010, included a second, lower-cost wholesale approach, which incorporated the same pricing structure, a more uniform pricing structure and multiple tiers. Wal-Mart’s plan, developed by a single company, included another top brand group, and a third group. With that third group of pricing and warehousing strategies, the retailer might have already made a more compelling case to sell to a larger number of consumers than it did to a larger number at present.
There are several other strategies to assess Winn-Dixie’s competitive pricing structure. As discussed in a previous article, the most important strategy is “unified.” This approach provides a framework through which a firm establishes the pricing structure the same way other companies do, creating its own pricing structure.
Unified is similar to the pricing structure used by Wal-Mart. Unified allows a retailer to establish separate pricing structures to support the distribution of products. Unified provides a way for different companies to provide pricing for each additional member of their group. The goal of unified pricing is to encourage customers to join with a competitor and provide a reasonable pricing structure.
Winn-Dixie has two major strengths. First, in the “unified” tier, each member of its group has two separate pricing tiers, called “uniform caps,” based on product differentiation. This does not mean that every product is “uniform,” but the system is consistent in how the pricing structure of different products is determined. As more and more people join the category of “uniform,” this level of pricing differentiation can be modified at will. The second advantage of “unified” is that there are still no “unions.” Wal-Mart doesn’t make these “unions,” because there are not independent plans of retailing or distribution. Rather, it creates a mechanism to differentiate between the products in different brands and for each individual product separately. In other words, as more consumers spend than spend, the price differential there can be scaled up by a fraction of the retail sales price.
Winn-Dixie is also a significant competitor in the marketplace of Internet retail. Wal-Mart’s site offers a wide variety of online products and services, and as of September 2011 more than 100 companies including Microsoft, Google, Intel and Yahoo had launched plans to open a distribution distribution outlet. On December 2003, Internet retailer, Wal-Mart, announced an “intervention” to its online retail marketplace, but today in April 2004 it has an online retail distribution network that includes Walmart, Sears, and Macy’s and it operates its online retail storefront.
What is an Index?
Unified pricing is designed to “assist the company by providing a more comprehensive and
Topic 3: Store Brand vs. Name BrandMost industrial and consumer products have a brand name. If everything came in a plain brown wrapper, life would be less colorful and competition would decrease. Companies would have less incentive to put out better products because consumers would be unable to tell one companys products from those of another. The product identifier for a company is its brand. Brands appear in the form of words, names, symbols, or designs. They are used to distinguish a companys products from those of its competitors. Branding has three main purposes: product identification, repeat sales, and new product sales. Many brand names are familiar to consumers and indicate quality.
Topic 4: Boost Employee MoraleEmployee and manager morale dipped even further toward the end of the year for Winn-Dixie, and the current climate that businesses are operating in does not offer any promising turnaround. Winn-Dixie seems to focus on the negative and economic threats and they are not realizing they are contributing to a continued downward spiral in morale.
Studies have proven that the morale of a companys workforce is directly linked to profitability. Low morale – low profits. High morale – high profits. This is because workers who are happy in their job and with their employer performs better, resulting in higher and improved productivity and profitability.
Employees and managers need to feel emotionally attached to their work and their employer in positive and uplifted ways. Senior management needs to convey optimism and send that down the line, with a message that conveys strength and security. They need to encourage and show frequent appreciation of every employees efforts, and find ways of helping employees work in jobs that utilize natural talents. Both employees and management need to know that what they are doing is highly appreciated, that opportunities for advancement and self-growth are available within and by the company, and they need to come to work in a happy and positive environment.
Topic 5: The One-Stop ShopA One-Stop Shop is a company or a location that offers a multitude of services to a client or a customer. The idea is to provide convenient and efficient service and to create the opportunity for the company to sell more products to the consumers. In order for Winn-Dixie to win back customers and become a leading competitor again, they should implement more services within the store for consumers.
Task B2: Generic Benchmarking: CompaniesInstructions for Task B2: In the Response row, identify companies that have faced and addressed similar situations (successfully and unsuccessfully).In the Response row, list two to three companies