The
company that we have chosen to research is ShopRite supermarkets. In this
research we will examine their inventory system as part of their management
information system.
ShopRite, a
leading name in the grocery business has been developing its signature name
since 1951. Today, ShopRite is the known for selling quality and brand name
products at competitive prices. They have also become the largest employer in
the state of New Jersey. ShopRite stores are located all throughout New Jersey,
New York, Connecticut, Maryland, Pennsylvania, and Delaware. There are over 280
stores throughout these states and together they employ more than 50,000
people.
Surprisingly
enough, ShopRite was first founded in 1946 right here in Newark, NJ by seven
grocers. A representative from Del Monte Foods introduced the idea to the
grocers about cooperative buying. Cooperative buying is when purchasers gather
and use their cash resources together to buy items in bulk. Retailers such as
ShopRite use this strategy to have a purchasing power over their suppliers and
that they get the items at a discounted rate. This was the strategy that the
seven grocers decided to do and together invested $1,000 each to form Wakefern
Food Corporation. Wakefern Food Corporation was formed on December 5, 1946
after the grocers noticed that cooperative buying resulted beneficial for both
the grocers and customers, because they were able to offer their customers low
competitive prices. After five years that the members worked separately under
their own names, they realized that they would be more successful if they all
worked under the same brand. Therefore, in 1951 the ShopRite name began and it
was a great marketing strategy because they saw an instant boost in their
sales. Once the name was changed to ShopRite it served to appeal new members
and over 50 members joined the cooperative of Wakefern. This large cooperative
helped to get even more distributors and demanded larger warehouse, trucking
operations, and even led them to develop their own private label. After a few
years in 1958 in order to continue to have an advantage with the competition,
ShopRite decided that it needed to cut its prices by a 10% in order to compete
with the markets’ trading stamps. Trading stamps back in the day were what we
would call today coupons or the club cards. In order to make sure that they
wouldn’t lose business to the competition they made this great strategy that
once again paid off. Ten years later after they began operating under the
ShopRite name, the Wakefern cooperation had a total of 70 members and has sales
revenue of $100 million.
ShopRite has had
many great marketing strategies and we believe it is the supermarket that has
the most services for its customers. They introduced the famous Can Can Sale
where all products that are in cans are sold at an amazing discount price in
1971. Currently the sale is held twice a year which gives the customers a
second opportunity to stock up on products. They have many other programs that
offer discounts such as the Baby Bucks Program and their price plus card that
gives discounts to its members. ShopRite has a different variety of services in
their locations such as a pharmacy and catering food ranging from deli to
meats. Some locations even have gas stations but not all. Shoprite stores are
mainly concentrated in New Jersey since we have the most locations but have and
continue to expand beyond our tri-state area.
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