Kroger

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The Kroger Company: A Customer First Strategy

Ian McClintock (i.a.mcclintock@eagle.clarion.edu)
Nick Born (n.p.born@eagle.clarion.edu)
Allen Walters (a.d.walters@eagle.clarion.edu)
The Kroger Company
9/29/10
BASD 490 Section 01

Abstract:

The Kroger Company is a leading grocery retail chain that prides itself on its customer satisfaction and conducting ethical business. Kroger operates nearly 2500 grocery retail stores in 31 states. An internal evaluation of the company's strengths and weaknesses are analyzed, in addition to an analysis of the company's external opportunities and threats. In coordination with this a consumer characteristic and behavior was diagnosed along with Kroger's strategic direction for its company. In addition, S.W.O.T. matrices are included in the appendix section of this report. In these matrices one can find, strengths of customer service, customer loyalty, as well as the company's diversity. Weaknesses include lawsuits, to unionization of the workforce, to poor financial figures. External Opportunities include but are not limited to reward, strategic expansion, and environmental programs. Threats to the industry like economical factors such as inflation and a recession, as well as changing food costs and high debt costs, all pose problems for Kroger. This paper will look to analyze these interior and exterior components, and the effect and appropriate concern they hold for Kroger.

Table of Contents
Introduction
History
Mission and Core Values
SWOT Analysis
Internal
External
Consumer Characteristics and Behavior
Strategic Direction
IFE Matrix (Appendix A)
EFE Matrix (Appendix B)
Works Cited

Introduction:
The Kroger Co. is a well known and recognizable grocery retail chain that prides itself on being a leader in the supermarket industry. When looking at annual sales, Kroger is also one of the nation’s largest retailer’s ranking at number 23 on the list of the Fortune 100. Although, the food stores account for 95 percent of Kroger’s sales, the company also operates a large number of convenience and jewelry stores, along with manufacturing facilities that account for the rest of the company’s business. Major competitors of Kroger include Wal Mart, Safeway, and CostCo. By the numbers, Kroger operates 2,468 grocery retail stores in 31 states and under a wide variety of names. These stores include: Kroger, Baker’s, City Market, Dillons, Fry’s, Gerbes, Hilander, Jay C Food Stores, King Soopers, Owen’s, Pay Less Super Markets, QFC, Ralph’s, Scott’s, Smith’s, Food 4 Less, and Fred Meyer. Kroger operates 784 convenience stores in 18 states under 5 names. These stores include: Turkey Hill, Kwik Shop, Loaf N’ Jug, QuikStop, and Tom Thumb. 372 jewelry stores are operated under the names, Fred Meyer Jewelers, Littman Jewelers, Barclay Jewelers, and Fox's Jewelers. Lastly, Kroger operates 40 food processing or manufacturing facilities. All of these numbers are current as of August 14, 2010. (The Kroger Co., 2010) Kroger and its sister brands are the employers of approximately 334,000 workers. The Chairman of the Board and Chief Executive Officer of the Kroger Co. is 59 year old David Dillon. He assumed the chairman position in 2004 and the CEO position in 2003. Dillon has been with Kroger since April 1986. In 2009, Kroger’s annual sales were reported at over 76.7 billion dollars with an operating profit of 1.091 billion dollars. (Kroger 2009 Fact Sheet, 2009)

The mission of The Kroger Co. is to be ‘a leader in the distribution and merchandising of food, pharmacy, health and personal care items, seasonal merchandise, and related products and services.’ Kroger also stresses six core values. These are: honesty, integrity, respect for others, diversity, safety, and inclusion.

Kroger’s corporate affairs and executive offices are located at 1014 Vine Street, Cincinnati, Ohio 45202-1100. Corporate offices can be reached at...
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