How Can Publix Improve?
Publix is recognized as one of the strongest retail grocery chains in the United States. From the outside looking in, it appears as though the employee-owned operation makes the right decisions for itself, its workers and customers as consistently as any company in the grocery business.
The Ledger newspaper recently asked a variety of supermarket industry watchers what they believed Publix could do even better to remain at the top of the competitive heap for the near future.
“It’s hard to find a lot to criticize with Publix,” said Lorrie Griffith, editor of the Southeast edition of the Shelby Report. “I think they have found their niche — that’s not to say they couldn’t do a little bit of work on pricing. I don’t think people walk into Publix expecting to find prices like they do at Wal-Mart, but I do hear of some people balking at Publix’s prices with other economic conditions now, like high gas prices.”
Mark Hamstra of Supermarket News, said Publix needed to “remain vigilant in terms of their price perception in the market, and the store-level execution in terms of service, because there’s no telling how strong Winn-Dixie might be when they finally come out of bankruptcy.”
Wal-Mart continues to expand in markets where Publix operates, said Mr. Hamstra, and it is moving into categories such as organic foods that directly compete with the supermarket chain.
Burt Flickinger, managing director of Strategic Resource Group, said Publix should increase its investment to quickly open new stores in Florida on the state’s West Coast and in its Panhandle region. The chain currently operates 643 of it 883 supermarkets in its home state.
Mr. Flickinger also recommended Publix look outside Florida to open more locations in states such as Alabama and South Carolina. Of the 883 supermarkets Publix currently operates, 28 stores are in Alabama and 37 are in South Carolina. The company also has 162 Georgia stores and 13 in Tennessee.
“This would be a key time for Publix to capitalize and show companies that are expanding aggressively into the market that Publix is going to defend the fortress with vigor in its key markets,” said Mr. Flickinger.
Ron Margulis, managing director of RAM Communications and RetailWire BrainTrust panelist, said Publix should drill down in its analysis of the shopping and purchasing behaviors of its most profitable customers. A more thorough understanding, he said, would empower Publix to focus on tactics such as incentives or personal attention to keep customers coming back to the store to spend.
“It’s about providing them with the right products at the right time, and promoting those items and services that will have the greatest positive impact on the way they shop,” he said.
Discussion Question: What can Publix do to improve? Do you agree with the assessment of industry-watchers quoted in the article?