ShopRite Presentation

http://www.kean.edu/~team2shoprite/webassign.html

ENJOY!

Conclusion

Today, Shop-Rite is the largest retailer-owned cooperative in the United States. Shop-Rite Supermarkets is a retailers' cooperative (co-op) chain of supermarkets in the Northeastern United States, in the states of New Jersey, New York, Connecticut, Delaware, Maryland and Pennsylvania. Based in Elizabeth, New Jersey Shop-Rite consists of 46 individually owned and operated affiliates with 217 stores, all under its corporate and distribution arm, Wakefern Food Corporation.

Throughout the blog we focused on Shop-Rite's strategies. Their main strategy focused on overall cost leadership. Shop-Rite applied this by offering the same or better quality product or service at a price that is less than what any of the competition is able to do.Since Shop-Rite uses an overall cost leadership, IT can be an effective tool. IT can tighten supply chain systems, help you capture and assimilate customer information to better understand buying patterns in an effort to better predict product inventory and shelf placement. The Price Club card comes in handy when trying to figure this out and also whenever a product is rung up and sold; it shows in the inventory when they are purchased and what products interest customers. Shop-Rite has a low threat of substitute products because many of their products have substitute items.

Shop-Rite also uses entry barriers which help make it hard for companies to enter the market. They use this in their technological advantage by purchasing cheaper and in bulk than its competitors so they could sell at a low cost. By doing so, this process takes a lot of time, research and money to establish and build relationship with their suppliers. Shop-Rite uses the customer relationship management (CRM) system as one of their major business initiatives. This helps gather information about customers to gain insights into their needs, wants, and behaviors in order to serve them better. Customers interact with companies in many ways, and each interaction should be easy, enjoyable, and error free.

Studying and researching Shop-Rite has helped us learn and understand key MIS terms such as marketing mix, hardware, software, and databases and data warehouses.The blog emphasized the use of online analytical processing, data mining techniques and software including SAS. In addition we looked at the hardware chosen by Shop-Rite which included Dell brand computers, some software identified included the Microsoft XP operating system and the Network chosen was the AT&T Wide Access Network. Shop-Rite distinguishes itself very well from its competition by emphasizing low prices and good customer service, “One place. Your place, Shop-Rite.”

Technology

In technological terms, hardware is the mechanical, magnetic, electronic, and electrical devices comprising a computer system, as the CPU, disk drives, keyboard, or screen. All of the computers used at Shop-Rite possess a CPU. Some of the hardware categories used by Shop-Rite are Connecting devices – scanners, monitors and printers. For storage devices, they use the internet as well as hard disk. Also storage devices are used at a later time. Shop-Rite uses output devices which are tools used to see, hear or otherwise recognize the results of your information-processing requests. These devices include monitors and register receipt printers. Their input devices are used to enter information and commands. Checkout scanners would be an input device.

The computer brand selected is Dell because flat panels because it uses less space. These were chosen as Dell offered easy customization and they were low cost. Shop-Rite uses Dell as their choice of their parent company Wakefern and having the same physical computers would ease synchronizing computers such as with networking, using and implementing programs across the companies.

Software is programs used to direct the operation of a computer, as well as documentation giving instructions on how to use them. Shop-Rite’s IT department is responsible for the hardware and software. System software refers to software that handles tasks specific to technology management and coordinates the interaction of all technology devices. Windows XP is the main system software being used by Shop-Rite. There was no indication that Linux is in use. Application software is that software that enables you to solve specific problems or perform specific tasks. The application software Shop-Rite uses is the Tradestone Merchandise Lifecycle Management suite. This is used to make Shop-Rite’s own in store label. The other is the TALs ActiveX. This is used for their bar-coding which the scanners record at check out. The most used brand of application software is Microsoft due to its compatibility with the Microsoft OS and database.

A file is defined as a collection of related data or program records stored on some input/output or auxiliary storage medium. Shop-Rite uses files such as employee files, customer files, suppliers and distributors and more. A database is described as a comprehensive collection of related data organized for convenient access, generally in a computer. The database software used by Shop-Rite is the Microsoft SQL software. Wakefern is also a huge part of Shop-Rite and use the same software. At Wakefern the database administrator is responsible for the database.

Managers get reports by using an application called Report Manager which was designed to work compatibly with the Microsoft SQL server. Report Manager is a Web-based report access and management tool that allows an administrator to access a single report from a remote location over an HTTP connection. There is plenty a manager can do with this database. With this, you can use Report Manager to browse the report server folders or search for specific reports. You can view a report, its general properties, and past copies of the report that are captured in report history. This allows managers to find information easily and efficiently.

OLAP (online analytical processing) is a function of business intelligence software that enables a user to easily and selectively extract and view data from different points of view. This allows business analysts to rotate that data, changing the relationships to get more detailed insight into corporate information. It is currently used at Shop-Rite and is used in their decision making processes.

Shop-Rite uses data warehouses. These specific warehouses are used to retrieve and analyze data, to extract, transform and load data, and to manage the data dictionary are also considered essential components of a data warehousing system. Data warehousing arises in an organization's need for reliable, consolidated, unique and integrated reporting and analysis of its data, at different levels of aggregation.

Shop-Rite also uses data marts. A data mart is a subset of an organizational data store, usually oriented to a specific purpose or major data subject that may be distributed to support business needs. They are often derived from subsets of data in a data warehouse, though in the bottom-up data warehouse design methodology the data warehouse is created from the union of organizational data marts. Shop-Rite’s data mart might contain just information and sales only about Shop-Rite and none about competitors. This allows them to focus just on their brand and improvements.

Data mining can be used to uncover patterns in data but is often carried out only on samples of data. The mining process will be ineffective if the samples are not a good representation of the larger body of data. Data mining cannot discover patterns that may be present in the larger body of data if those patterns are not present in the sample being "mined". For data mining Shop-Rite utilizes SAS which gathers information about customers which is then used by marketing to efficiently and effectively target customers and potential customers. Data analysts are responsible for detecting relationships between the market and customers.

The Wakefern Food Corporation along with Shop-Rite supermarkets use AT&T as their computer network because they have enlisted in a four-year contract with the telecommunications server. Shop-Rite locations use Ethernet cards to connect with other stores as well as corporate offices in Keasbey, New Jersey. Wakefern uses Digital Subscriber Lines, more commonly known as DSL, coupled with a Wireless Access Point to access their network. The communications software utilized by the corporation includes an IP-based TPS/NetWork File Manager to transfer files from one computer to another. Through AT&T, Wakefern and Shop-Rite use a broadband connection that has a capacity to run at 768 kilobits per second (kbps). A broadband connection basically works with DSL to run a high-speed connection over a phone line without interrupting typically with speeds in excess of 128 kbps.

Voice over Internet Protocol is a term that refers to a family of communication protocols and transmission technologies for delivery of voice communications and multimedia sessions over Internet Protocol networks. The Wakefern Food Corporation does not currently employ a Voice over IP. The four principles of network security include confidentiality, authenticity, integrity, and availability. Wakefern and Shop-Rite exercise these four principles with help from CounterACT, which is an integrated security platform, used to protect the network from illicit access. CounterACT also allows network administrators to thwart any malware which is applicable to employees of Wakefern as well as customers who choose to log in and provide online payment information. More importantly, Wakefern actively owns fourteen domain names, two of which are Shop-Rite.com and Wakefern.com.

Article

Chris Harper February 4, 2010

ShopRite, Safeway, Kroger launch mobile coupons via Verizon

ShopRite, Safeway and Kroger along with other grocery chains are serving mobile coupons via Verizon Communications Inc.’s new free digital coupon service for its wireless and FiOS TV customers. Consumers can access the coupons via their wireless devices, televisions and computers. The Spend Smart coupons are powered by Cellfire in an effort to eliminate the hassle of clipping and collecting paper coupons.

Cellfire has traditionally seen highest appeal for discount services on the phone from consumers that are in the 25-to-49 age range. Most consumers today already have a cell phone and Verizon offers many highly capable phone models that can take advantage of services like Spend Smart. Verizon Wireless customers can register and sign up for the coupons via the mobile Web on the shopping channel. There is no cost to register or use the service, but data or megabyte charges may apply when accessing the mobile Web. This whole new idea gives retailers and consumer packaged goods companies a great way to increase their distribution.

Read more: http://www.mobilecommercedaily.com/shoprite-safeway-kroger-launch-mobile-coupons-via-verizon/

Strategy

Porter’s Three Generic Strategies of building business strategy involves three approaches or strategies to beating the competition in any industry, and they would be 1. Overall cost leadership, 2. Differentiation and 3. Focus.

Shop-Rite uses overall cost leadership. Defined by Porter, as offering the same or better quality product or service at a price that is less than what any of the competition is able to do. They basically want to be the top supermarket out of their competition such as Pathmark, FoodTown, A&P, Stop&Shop, and more. They are even competing against Super Wal-Mart’s because they also are beginning to carry much more supermarket items similar to Shop-Rite.

Since Shop-Rite uses an overall cost leadership, IT can be an effective tool. IT can tighten supply chain systems, help you capture and assimilate customer information to better understand buying patterns in an effort to better predict product inventory and shelf placement. The Price Club card comes in handy when trying to figure this out and also whenever a product is rung up and sold; it shows in the inventory when they are purchased and what products interest customers.

The Five forces model was designed by Michael Porter and it has been used by businesses to help people understand the relative attractiveness of an industry and the industry's competitive pressures as it relates to: 1. Buyer power, 2. Supplier power, 3. Threat of substitute products or services, 4. Threat of new entrants and 5. Rivalry among existing competitors.

Buyer power refers to how high or low the customers buying choices are. In Shop-Rite the buyer power is relatively high as customers can easily go elsewhere to purchase the same products that Shop-Rite offers with the exception of their Price Plus card which is their own loyalty program. Shop-Rite’s loyalty card allows you to receive discounts on sale items. Some products are already put on sale for that weekly sale but some require you to use your loyalty card to receive additional discounts on your purchase order. They try to reduce buyer power by selling high quality products cheaper than what customers would find elsewhere so customers would purchase their merchandise.

Supplier power is the opposite of buyer power; it refers to how high or low the buyer’s choices of who to purchase from is. Shop-Rite has a low supplier power as it has a variety of suppliers whom it can purchase from and it maintains this low supplier power by having its suppliers compete by auctioning or bidding on areas where they want their products to be marketed and sold. One example would be Pepsi and Coke Cola because they continually try to outbid one another for specific areas of the store. Location of a product is also a key factor. If your product is not in the peripheral vision of customers, then don’t expect high sales and revenue coming in.

Threat of substitute products or services is high or low depending on how many alternatives there are to certain products. Shop-Rite has a low threat of substitute products because many of their products have substitute items. For example Tylenol, Shop-Rite’s substitute for of Tylenol would be the acetaminophen. The more items they are able to provide substitutes for, the more sales they will be producing.

Threats of new entrants are high when it is easy for new competitors to enter a market. Shop-Rite’s threats are somewhat high when new establishments of competitors are built in the same area. This type of situation recently occurred, when a certain Shop-Rite that has been around in the Ocean County area for quite some time and a Super Wal-Mart was being built right next door. This was a huge red flag for Shop-Rite. They had to strategize what was going to take effect so nothing would greatly harm their sales.

Rivalry among existing competitors refers to how much competition is faced in a market. Shop-Rite has intensive competition from other supermarkets such as Pathmark, FoodTown, Stop&Shop, and more. But there are also small shops that you can’t forget about. All of these companies are in the food industry and are against and competing with Shop-Rite. To reduce this Shop-Rite tries to distinguish itself from its competition by emphasizing low prices and good customer service, “One place. Your place, Shop-Rite.”

Switching costs are costs that make customers reluctant to switch to another product or service supplier. Shop-Rite uses switching costs by providing the lowest price as possible on most of its products so that customers would be reluctant to switch to a higher costing competitor. Shop-Rite’s loyalty card has plenty of benefits. Either if it’s used to accumulate points to be redeemed for prizes or to reduce your bill, receiving coupons that would interest you, outstanding savings every time you present the card at check out, Shop-Rite is pleasing the customer and bringing them back for more. They also are involved with going green. They have mesh bags you can purchase and every time you use the environmental friendly bags, you receive 5 cents off your total bill for each bag you use. You’re saving the earth while saving yourself some money, not bad.

Shop-Rite uses entry barriers which help make it hard for companies to enter the market. They use this in their technological advantage by purchasing cheaper and in bulk than its competitors so they could sell at a low cost. By doing so, this process takes a lot of time, research and money to establish and build relationship with their suppliers. A company trying to enter this market would have to have a significant amount of money, technology, as well as connections in order to efficiently compete in this industry.

Shop-Rite uses the customer relationship management (CRM) system as one of their major business initiatives. CRM uses information about customers to gain insights into their needs, wants, and behaviors in order to serve them better. Customers interact with companies in many ways, and each interaction should be easy, enjoyable, and error free.

To power Shop-Rite, they use SAS solutions software for retail turn data about customers, merchandise and operations. SAS software is a vital part of Shop-Rite’s IT as it allows them to make more informed decisions and gain competitive advantage over its competitors in terms of targeting potential markets for products.

Shop-Rite has bottom-line initiatives, which focuses on minimizing expenses. They make this possible by optimizing manufacturing processes, decreasing transportation costs, reducing the costs of human capital, minimizing errors in process, which are a few of the many tasks. A bottom-line strategy is very similar to Porter’s strategy of overall cost leadership, which Shop-Rite follows. Also from an IT point of view, you must form a business strategy that addresses the role of IT in affecting both the top-line and bottom-line, though not necessarily equal.

An organization can place the IT function in a number of ways and these 3 would be the most common: top-down silo, matrix, and fully integrated throughout the organization. Shop-Rite has a structure similar to that of the top-down pattern. With this approach, Shop-Rite created an IT department devoted exclusively to everything related to technology such as budgeting, project management, capacity, processing, and so on. This type of management style projects the company being well-built in command and control. Functions like finance and marketing must go though the IT department for approval of new projects, the generation of ad hoc reports, support functions, and more.

Companies can adopt one of two philosophical approaches to IT. A company can choose to be centralized also known as “wait and see” adopters or rather decentralized also known as “early it adopters”. Shop-Rite uses the centralized approach. They require the demonstration of considerable return on investment before first adopting a new technology within the IT function and then deploying that technology to the rest of the organization.

Shop-Rite’s leading form of marketing for their customers comes from their weekly circulars along with their television, radio, and newspaper advertisements. Wakefern must seek wholesale buyers using other forms of marketing such as e-marketplaces, which include www.supplierlist.com and www.alibaba.com. As far as the types of payment that Shop-Rite allows for online customers they will accept all major debit and credit cards from Visa, MasterCard, American Express, and Discover. Shop-Rite has also recently started using PayPal for orders placed online.

While Shop-Rite is one of the leading grocery centers in the northeast, the company also delivers with e-commerce. Shop-Rite mainly deals with a Business-to-Consumer Internet business model, as it is a company selling to the general public without human interaction. In certain areas, a customer can shop for their entire grocery list with just a couple clicks of a mouse. Unfortunately, this service is not available at any local Shop-Rites as the closest store that offers “Shop-Rite From Home” is about twenty miles away. All consumers can however order electronics, holiday dinners, and party planners on their home computers. Shop-Rite’s parent company, Wakefern, does present a Business-to-Business Internet business model as they supply smaller businesses at a wholesale level. Smaller businesses involved with Wakefern can also benefit from services such as transportation, financial support services, store development, and technical support.

Article
Written July 8, 2010
Spanish exchange students tour Warwick Shop-Rite

Us Americans take for granted many things in life. One would be a supermarket. In other parts of the world, believe it or not, they don’t have supermarkets filled with every necessity you might need. This shows Shop-Rite's business strategy of overall cost leadership. They are making wants and needs more simpler for the customer by having every necessity.

A group of foreign exchange students from Spain took a tour of Warwick’s Shop-Rite and was one of the highlights of their four-week stay in this area. It’s crazy to think that a supermarket would amaze people. When the students purchase bread or meat or produce in their home towns, they go to individual shops, like a bakery, that specialize in those products. Shop-Rite has almost everything you might need, from produce, meats, fishes, breads, pastries, hygiene products, grocery items, frozen, dairy, floral, and pharmacy. Also they carry stationary products, magazines, newspapers, books, cosmetics, toys and electronics. This store to the students is an all in one superstore. We are pretty fortunate to have all this in one stop and the students appreciated very much on their trip Shop-Rite.

Read more: http://strausnews.com/articles/2010/07/09/warwick_advertiser/news/22.txt

Intro

Shop-Rite is a chain of supermarkets in the North Eastern United States. With some 246 stores based New Jersey, New York, Connecticut, Pennsylvania, Delaware and Maryland, it is the largest retailer owned store chain in the US. Shop-Rite is the banner under which the stores of the Wakefern Food Corporation (its parent company) operate.

The Wakefern Food Corporation was founded in 1946 when the idea of pooling together resources to buy in bulk at a cheaper price was introduced to eight independent New Jersey grocers. Each member contributed an initial investment of $1000.00 dollars. The name Wakefern name is a combination of the founders’ names. The Shop-Rite banner was adopted for its stores in 1951.

Wakefern’s CEO, Joseph Colalillo, took office in May of2005 from Thomas Infusino. He is not only the CEO but also the president of three Shop-Rite stores in Hunterdon County. His focus as CEO is the independent operator and wholesaler. He has expanded the wholesale division of Wakefern since taking office.

Some of its social responsibility policies which they rigorously pursue have made Wakefern an industry leader. It includes a storewide recycling program of their grocery bags and pharmacy stock bottles. On the retail end, there is the Bag and Re-use program which credits 2 cents for a reused bag and 5 cents for non disposable bag.

They also partner with the Special Olympics of New Jersey, where they donate food and volunteer staff. Their risk management policies include security and surveillance cameras placed strategically throughout their stores. The loss prevention department comprises of men and women who are mystery shoppers in plain clothes.

Additional partnerships include the Association of New Jersey Environmental Commissions (ANJEC). This is a non-profit organization which helps New Jersey environmental commissions, local and state agencies to preserve natural resources. The Audubon Society of New Jersey preserves wildlife and other natural systems. Its work had been ongoing since 1897. The Greater Newark Conservancy aims at promoting environmental stewardship to help improve the quality of life in the urban communities of New Jersey.

Wakefern is also planning on implementing the Safe Quality Food Certification program in order to make sure that the suppliers, with whom they work, maintain the highest food safety standards.

Resources:
www.shoprite.com/cnt/wakefern/WFC_History.html
www.shoprite.com/cnt/wakefern/WFC_Environmental.html