This website uses cookies to ensure you have the best experience. Learn more

Hi Value Case Essay

1170 words - 5 pages

James Ellis, the senior vice president of Hall Consolidated and president of Hi-Value supermarkets, must decide whether to pursue an everyday low pricing (EDLP) strategy at its three Centralia MO locations. After much analysis, I believe that my recommendation would be for Superior stores (Hi-Value) to most definitely adopt this new method. First let’s look into some details about Hi-Value, and their competition:

Product: The stores’ products are divided into 5 categories: 1) grocery (including diary); 2) fresh meat/poultry/seafood; 3) produce; 4) seasonal and general merchandise; and 5) bakery and deli.
Price: more of a high-end branding strategy. Hi-Value everyday (non-promotional) ...view middle of the document...

But Hi-Value must understand that; the growing price consciousness among Centralia shoppers could hurt their image of having higher prices, and that they are seeing decreasing figures in the future (“since store sales were below budgeted levels in the 1’st quarter of [2006]”). Also their best performing store, South Prospect, is two blocks away from competition. The other two stores have competition either across the street or within the same shopping center.
The competitive environment that Hi-Value is in right now also effects their decision of EDLP. The demand in this supermarket industry is elastic, with multiple opportunities for competitors to steal market share. Exhibit 5 shows how $100 is spent in Centralia supermarkets: 49.67% perishables, 30.95% food grocery, and 19.38% on miscellaneous (health care, general merchandise, etc.). Also, who shops where effects the effectiveness of pricing; the median age of the Centralia population was 35 years; the median household income was $36,000; and 80% of residents had a high school education or more. Will these customers want another “cheap” supermarket? Exhibit 7 says yes (with the exception of meat quality and price). Hi-Value is considered reasonable with price, and quality produce/meat, overall variety of foods (Exhibit 6). Therefore, products must be consistently available and reasonable customer service is expected.
Missouri Mart is considered their closest competition. Their food sales volume are the highest for Centralia and offer more general merchandise, which makes up 60% of its floor space. Harrison’s captures sales from middle/upper-income groups with incomes in of $40,000 or more. The store is clean, orderly, and well managed. General American is “the most modern store in Centralia and has the finest fixtures and décor –its wide aisles make it relatively easy to shop.” All competitors have more floor space, attractive stores, greater overall variety, customer awareness and contact (through their advertising).
But Hi-Value has strengths help justify the use of EDLP. For example, providing on-time delivery of goods is critical for Hi-Value to maintain good customer service. They also have an extensive ‘in-house’ network. There are opportunities to buy out smaller competitors, develop a price conscious advertising campaign aligned with customer expectations, and participate as a member of the community (mentioned hosting local charity events, etc.). The only threat against them is the pricing wars as a result of Hi-Value adopting an EDLP strategy.
So James and Hi-Value have multiple roads to go down to try and increase sales, and...

Other Essays Like Hi-Value Case

Guillermo Furniture Store Essay

764 words - 4 pages sell coated furniture, he can use available information for labor hours along with production value to make calculation of possible profit. By using income information, Guillermo can get comparative and relative figures that he can be expecting earn in future by using the current method, hi-tech method or become a representative. Using current method, Guillermo Navallez can expect income before taxes 46,118, using hi-tech method expected income

Theoretical Concepts In Companies Essay

1151 words - 5 pages the society and represent then in an ethical away. In 21st century, consumers are more willing to believe a social responsibility company which case about its shareholder, stockholders and value creation, but at the same time operates in behaves of the society and experience social responsibilities. The idea of capitalism is now broken and people are worried about environment and making the world better place. In my opinion, this idea does not

Mergers Don’t Always Lead to Culture Clashes

905 words - 4 pages and integrated practices from both sides retaining the most successful ones. Equally worthy is to note that BOA, being the more frugal and thrifty of the two mergers imposed its will on MBNA in some case. For example, because MBNA’s pay rate was above market it imposed management pay –cuts. Other actions involved donating its golf course and removed the work of arts from the corporate offices. All but one of MBNA’s corporate jets was

Jb Hi Fi 2013 Fin Report Analysis

2568 words - 11 pages likely to remain weaker as economy would adjust to higher levels of inflation and commodity prices. 2. High market competition The market in which JB Hi-Fi (JBH) operates is a mature industry, thus severe competition exists, due to the high degree of similarity, between JBH and other retailers, such as Harvey Norman, Dick Smith and The Good Guys. Although, JBH has maintained its market leading position, its ability to gain may be limited when

Case Study

1183 words - 5 pages Case Assignment 1 1. Build the management-research question hierarchy. The management –research question occurs during stage 1 of the research process. The approach for this stage of the research process is to state the dilemma that prompts the research and then develop other questions by progressively breaking down the original question into more specific one (Cooper & Schindler, 2014, p. 77). Our case highlights a multistage

Bp Case Study 2

859 words - 4 pages the value of pension; this must be considered when deciding on the amount to invest in the fund. [9] . : ----------------------- [1] Shirin lectures [2] Shirin lectures [3] [4] [5] [6] [7] [8] Shirin lectures [9] Shirin lectures

Sql Injection

7126 words - 29 pages character to lower case. Finally ascii() function will return the ASCII value of this character. If the application return the 5 th press release in response to this query then we know that the first letter of the first user table starts the character after m (ASCII 109) in the alphabet. By making multiple requests, we can determine the precise ASCII value. 2. Getting first character of the user table-Step 2

Practices of the Apple Corporation

3055 words - 13 pages code of conduct. It is important to note that this voluntary code of conduct breaks no new ground. It is at best a modest attempt to ensure that workers will be treated fairly and provided with a safe work environment. Yet the violations continue, despite years of monitoring factories where Apple's own audits show persistent non-compliance and despite these factories' repeated broken promises to improve. Apple's Strategic Profile - Value

Guillermo Furniture Analysis

1652 words - 7 pages calculation is the most used approach to discount cash flow toward helping to find the value of the intended projected cash flow within the present and future world of business finance. If the NPV is positive Guillermo would likely take on the project, in this case he would buy high tech equipment because the cash flow from the equipment will benefit his customers and his business successfully. By creating a five year budget Guillermo can predict


1435 words - 6 pages charged for every single transaction made under Cash on Delivery option. 2. INR 100 (Rupees one hundred only) is charged for every single transaction in case of any pre-paid order(s) provided that the relevant order is less than or equal to INR 750 (Rupees seven hundred and fifty only). The aggregate value of the Products pertaining to a single order, after reducing discount(s)/store credit(s) or any other such amount, shall be considered for

Options, Futures and Risk Management

2159 words - 9 pages ) | 3.74% | 1.1317 | COCHLEAR | 871051(RI) | 3.96% | 0.8402 | WESTFIELD GROUP | 912307(RI) | 2.56% | 0.7096 | TELSTRA | 871685(RI) | 4.60% | 0.5050 | MACQUARIE GROUP | 865438(RI) | 4.36% | 1.4238 | INVOCARE | 28047X(RI) | 3.87% | 0.7210 | FLIGHT CENTRE TRAVEL GP. | 871048(RI) | 4.28% | 1.0063 | CSL | 131775(RI) | 4.89% | 0.6488 | SLATER & GORDON | 50509L(RI) | 4.79% | 0.3001 | JB HI-FI | 27736M(RI) | 4.50% | 0.8261

Related Papers

Jb Hi Fi Financial Analysis

2532 words - 11 pages JB Hi-Fi Ltd -Analysis of Company Financial Information Assignment topic * Evaluate the performance of a company through a critical analysis of its published financial statements over the last 2 years as follows: * Locate, extract and analyse data from the published financial statements to provide a comprehensive analysis of a company’s operations and performance; * Structure an argument based on the analysis of five

Accounting Essay

2138 words - 9 pages be  $50,956. Also, if Guillermo goes in for the hi tech process or broker the sales forecast will be 3,798 for both the hi tech and broker but it will remain at 2,532 for mid-grade in the current process, if Guillermo goes in for the hi tech process or broker the sales forecast will be 759 for high-end, for both the hi tech and broker but it will remain at 506 for high-end in the current process. However, the in case of both the hi-end and

Pro Forma Cash Flow Budget Essay

1477 words - 6 pages the Hi-Tech alternative as the best option where IRR value of 64.7% far exceeds the WACC of 6.38% but in the case of current and broker alternatives IRR is only 6.9% and 11.0% respectively. Relative Valuation Technique is another approach where current price of asset is compared with market value of same kind of assets. It assists in securities investment where price anomalies can be rectified and investors can take better decision in asset

Finance 571 Essay

1821 words - 8 pages is the need to have an extra maintenance position. In case of hi-tech and distributor the maintenance position will cost extra salary of $45,000 whereas the current business does not necessitate any such position. Similarly, the cost of utilities is likely to increase the full production if Guillermo goes in for hi tech, however, the cost of utilities will reduce from $9,000 to $4,497 if Guillermo goes in for distributor. A sensitivity