Safeways motto “ingredients for life” can be seen everyday hroughout their in store practices and in the communities surrounding their storefronts. The positive outreach Safeway has on its surrounding neighborhoods is endless; from hunger relief foundations, to supporting the local baseball teams, Safeway is making a difference in the local community. Safeway Inc. believes In healthy, fresh ingredients. By supporting over 100 local farmers, Safeway is ensuring healthy and fresh options. They are committed to upholding their creed of “creating better lives, vibrant neighborhoods, and a healthier planet”.
Safeway stands to promote groMh by expanding upon its existing online resence. With Safeways growth strategy being focused upon simplifying living a healthy lifestyle, creating an easy online ordering process is essential. The growth strategy drafted will allow consumers an easier way to access healthy and fresh options. Through the implementation of our snapshot recipe service, Safeway will allow shoppers to conveniently upload recipes from multiple different sources. Safeway plans to expand upon the emerging online grocery market and become one of the market leaders in grocery delivery.
Safeway must achieve a level of brand recognition to achieve success n this field. To ensure success, Safeway will offer incentives for their services. These incentives include the first delivery of their products free, in an attempt to gain the trust of customers who are hesitant to shop online. With in store promotions and offers Safeway will be advertising its new website. Our estimated sales will be growing overtime. Safeway will focus on the consumers who already utilize the delivery and in-store pick up but hope to gain more loyal customers and grow their business.
With all of these combined components Safeway hopes to grow total revenue for the company. With healthy alternatives being the main focus of Safeway, it plans on creatinga better way for shoppers to make healthy meals at home. Who is Safeway Inc.? The creation of Safeway Inc. all started with a business merger between M. B. Skaggs’ 428 stores and Safeways (formerly Selig) 322 stores in 1926. M. B. Skaggs was from a small town in Idaho and had started his vision after he purchased his father’s store in 1915 (“Our Story,” 2014).
In his efforts to expand his business, M. B. Skaggs realized the customer wants and needs are what ultimately drive success. Therefore, Skaggs strived to give his customers he value they not only deserved but demanded; this revelation still drives Safeway but now on a much grander scale. For instance, a prime example in Safeway’s history that makes it evident was when Safeway Inc. introduced produce pricing by the pound, adding the “sell by dates” on perishable items to guarantee freshness, nutrition labeling and parking lots during the 1 930s (“Our Company,” 2014).
The use of these tactics was to help benefit the customer and better the experience, making Safeway stand out as prominent force. And as time has progressed, same can be said about Safeways campaign. With utilization of an app for phones and a website, Safeway has been able to offer home delivery for groceries (through e-grocery) as well as information about options for healthier living. Safeway Inc. is company well-known for their devotion to the ideals of “community. ” During Safeway’s lifespan, these standards continually develop through various philanthropic outlets like donating to charities and/or volunteering time and efforts.
In particular, Safeway Inc. puts emphasis on the wellbeing Of not only their local area but the planet as a whole. “Each year, Safeway donates more than $110 million worth of food and erchandise to local food bank and hunger relief program in communities throughout the United States (“Community Caring”, 2013). They also have given more than $1 30 million to support education and schools through a variety of education and enrichment programs like escrip rewards since the year 2000. Another huge philanthropic event Safeway Inc. s raising money for Easter Seals and the Muscular Dystrophy Association to contribute funding to fight against neuromuscular and developmental diseases. Throughout the years, Safeway Inc. has raised more than $327. 5 million for unger relief, education, and people with disabilities; however, that number excludes the amount of funding Safeway Inc. puts towards health and human services. “Safeway Inc. supports vital health and human service programs that promote healthy families” (“Community Caring,” 2013).
The company deeply believes and lives by the motto of creating better lives, vibrant neighborhoods and a healthier planet. These fundamental beliefs originated as the roots of the business; as Safeway continued to grow and prosper the reach of its branches have led to make more strides for the company in egards to innovation for customers’ needs. Safeway Inc. is more than a mere grocery store by offering a wide variety Of products and services, they actively try to reach consumer demands. To ensure higher quality of products, Safeway pushed their foot through the door into the farming industry.
Safeway Farms was established to provide the farm-to-table quality many expect in every bite. The utilization of private farms and local farm vendors has given access for Safeway to grow their own ingredients with guarantees of the freshest quality of prod ucts grown by the highest standards. Another great option offered through Safeway is the organic lines called “0-Organics,” which encourages a healthier lifestyle through options without growth hormones, preservatives, and are not genetically modified (“0-0rganics,” 2013).
Safeway also has a signature deli in every store to offer an assortment of sandwiches, soups and hot items. One huge factor that has allowed Safeway Inc. to standout from competitors in the same industry is utilization of e-grocery and home-delivery. Some competitors are trying to get in on this technique of business; however, Safeway Inc. as been doing home-delivery for many decades now and has the advantage of experience. Corporate Mission Statement Safeway Inc. ‘s vision is to earn the loyalty of the people they serve through the talents and passion of employees.
Whereas, their mission statement is [w]e earn the loyalty of the people we serve by first anticipating, then fulfilling their needs with our superior-quality products, a unique shopping experience, customer-focused service, and contin uous innovation, while generating long-term profitable growth for shareholders” (“Mission-Vision Statement, 201 3 ). Through their vision and reinforcement of the mission statement, Safeway has set standards to which they plan to hold themselves accountable.
SWOT Analysis SWOT is an acronym for compartmentalizing the internal strengths (S) and weaknesses (W) of a company as well as the external opportunities (O) and threats (T) that it faces. SWOT- Safeway Inc. Organizational Structure Key Executives Robert L. Edwards Chief Executive Officer, President Director and Chairman of Executive Committee Peter J. Bocian Chief Financial Officer Executive Vice President Diane M. Dietz Chief Marketing Officer Kelly p. Griffith Executive Vice President of Retail Operations Larree M. Renda Executive Vice president David F.
Bond Chief Accounting Officer Senior Vice President of Finance & Control Robert A. Gordon Chief Governance Officer Senior Vice president General Counsel and Secretary Russell M. Jackson Senior Vice President of Human Resources Barry J. Libenson Senior Vice President Chief Information Officer Melissa C. Plaisance Finance and Investors Relations David R. Stern Planning and Business Development Jerry Tidwell Su pply Operations Donald P. Wright Real Estate and Engineering In May 2013, President Robert L. Edwards succeeded Steven A. Burd for Safeway Inc. ‘s Chief Executive Officer. Mr.
Burd had been serving in this position since 1 993 until the day he retired. He also served as Safeway Inc. ‘s President from 1992 until 2012 and the Chairman of the Board of Directors from 1998 until retirement too. By Steven Burd being with Safeway for over two decades in higher ranking positions, Robert Edwards had big shoes to fill. The organizational structure of Safeway Inc. is Robert Edwards oversees the company as a whole, but distributes power to various presidents that cater to particular division with established committees (Bloomberg Businessweek, 2014). Industry Environment Safeway Inc. s industry environment can be regarded as an oligopsonistic competitive market. An oligopsony is “a market in which there are only a few large buyers for a product or service, [which] allows the buyers to exert a great deal of control over the sellers and can effectively drive down prices” (“Oligopsony,” 2014 ). Originally, Safeway was disti nguished in the grocery sector but now it has grown into the retailing sector too. Safeway Inc. ‘s competitors are geared towards segments in the market where they are apable of satisfying consumer needs with an extensive range of products (“Our Company,” 2014).
Some of Safeway Inc. ‘s competitors include Wal-Mart, Kroger and Whole Foods for in-store transactions; whereas, Amazon is transitioning to be one of Safeway’s main competitor for online delivery for the fact they recently launched the capability of delivering perishable items. By Amazon being a prominent force in the online market, Safeways home- delivery system has to become more innovative to stay a contender. As the economy continues to rise, there is more demand from consumers to have he availability of products and services they not only need but want.
Safeway is taking advantage of this by utilization of the online portion of its company. As stated in the previous paragraph, Safeway operates in a highly competitive marketplace with several firms fighting for a similar target market. In order for a company to be successful in such a marketplace, they must fully understand the environment they operate within, as well as the needs of the customers they intend to service. When determining a business environment, both external and internal factors must be determined. These internal and xternal are composed of several factors.
Internally, the organizational culture Of the Company must be evaluated. It is important that the visions Of the upper management and objectives of lower management are synergistic in order to achieve targeted goals. Externally, the political, macroeconomic, microeconomic, social and technological elements are essential to a firm’s short term and long term success (Commander, 201 1). Safeway has been an entity since 1925; it is important to view the past decisions of the firm in relation to its business environment to understand how the company makes ecisions.
Safeway believed one of the best ways to increase revenue was to expand in the 1960’s. They did this by growing internationally into places such as the United Kingdoms, Australia and West Germany (Skrainka, 2012). They also later expanded the company into areas such as Mexico, Saudi Arabia, and are currently attempting to breach into Kuwait via a joint venture. In the early 1 930’s, Safeway attempted to combat the Macroeconomic issue of the Great Depression by offering pricing by the pound and a cash only point of sale approach to limit consumer debt.
The ability to price by the pound llowed consumers to choose exactly how much of a product they wanted without having to overspend on large quantities and produce waste. past concepts aimed at breaching into different market segments included a trial bi-level international store, offering exotic meat selections such as boar, snow hare and reindeer (Senauer, 2010). Many of these past concepts were ineffective for Safeway; however the knowledge gained by failed propositions in certain cases can be worth the cost of the endeavor. In 201 3, Safeway had over 30 billion dollars in revenue with over 1 30,000 employees (Safeway Inc. 014). It has a responsibility to its shareholders to create value, as well as a social responsibility provide a stable environment to its employees. In order to sustain these goals, Safeway puts a considerable amount of capital into researching their current business environment. Economically, Safeway is in a positive position in regards to consumer spending on food. Consumers’ trends point straying away from eating out in attempts to reduce costs; by eating out less and making more meals within the home, Safeway stands to make more money as a grocer if they can capture this market.
Safeway is in a reat sector of business because inherently, all humans must eat. Since Safeway fulfills this customer need with their product line, they are in an excellent position. The catch is Safeway must find the best way to cater to the needs of many to be successful, and do it better than its competitors. The cons surrounding Safeway involve consumers spending less each visit they take into the grocery store. Also, as consumers cut expenses by reducing the total number of purchases when shopping. With less consumers making on the spot” or impulse buying decisions, overall revenue will decrease (Massara, 2013).
Safeway also offers e-grocen,’ services in certain locations, a market in which rapid growth is possible. Our core project group believes that Safeway could find great success in marketing the e-grocery services. Safeway should not only look at the general public, but to those who are temporarily disabled due to an injury, nursing homes and those whose ability to drive is either temporarily or permanently restricted (DUI, injury, disability). In addition to this, Safeway could develop a plan for families where a portion of their weekly meals are planned out via a recipe program by a licensed utritionist.
Instead of randomly searching for meals, a custom plan could be created by judging a consumer likes and dislikes and a portion of the meals could be delivered to the door. A con of the e-business of groceries is that it has been done and failed by many. In the early 2000’s several firms tried to enter the marketplace with only a few large firms ever posting profits and success. One company is Peapod, who would be a direct competitor to Safeway (Navis, 2012). The advantage Safeway brings to the table revolves around brand recognition, as well as overall size in obtaining the lowest costs n order to compete.
Many consumers are weary about the overall freshness of online delivery and some question delivery practices involved. Safeway is capa ble of combating these consumer worries with a strong trusted firm. Safeway also incorporates a self checkout system aimed at reducing consumer time spent in the store and a relatively hassle free way to check out. Research points to an increase in customer satisfaction when able to use a POS (point of sale) system such as a self check-out of self-service approach.
The less hassle a customer must endure to complete a purchase means they re less apt to choose a substitute option, such as eating out a restaurant instead. A con with such a system other retail providers also use the same type of system as Safeway and had implemented this system before Safeway. In this sense, Safeway is not an industry leader and the technology of POS systems is not unattainable to other firms in the market or those who are looking to enter (Dabholkar, 2003) Politically, Safeway has had a few blunders involving lawsuits.
The most recent involved the store labeled Kona Coffee. A customer filed a complaint with the Federal court insisting they had been isled as only a small percentage of the branded coffee actually came from Hawaii. Safeway later settled out of court for the amount of $5 million dollars (Mislabeling Lawsuit, 2013). Comparing Safeway financially to other leading grocery stores using the Bloomberg program, it is easy to see that Safeway itself is not the most exciting stock. In the past 3 months, the price has not fluctuated over more than 1. 5%. However, stability is not a downfall.
Safeway Inc. has avenues for success and the resources to follow through with any plans we would like to implement. Safeway must constantly scan the current environment it operates within to succeed in the highly competitive marketplace it resides within. By evaluating consumer trends, reviewing previous mistakes and by being socially and politically responsible, Safeway stands to be a heavy influence on the retail grocery market for many years to come. Customers (demographics, psychographics, buying behavior) The established customer base Safeway Inc. ries to reach is essentially every grocery shopper. Safeway caters to a wide variety of demographics that are prominent in their local communities, following with geographical ifferences depending on the area. Those who take advantage of the e- grocery and home-delivery system offered by Safeway Inc. typically are parts of the aging “baby boomer” generation and working middle class. On average, home-delivery is utilized by customers who are disabled/ handicapped, have lack of transportation, or dual income households.
Safeway takes into consideration more affluent customers to expand their focus pool. This is apparent in its products that range from the practical Iow- cost items to more expensive luxury ones. The psychographic that Safeway ries to reach include those that are not extremely price conscious and deem quality as well as service more important than the cost. The buying behavior of Safeway Inc. ‘s shoppers is traditionally revolving around the concept of convenience and availability of the products.
Therefore, it centralizes a demand for essential products and services that an everyday consumer would need in regards to food, home and health (“Our Company,” 2014). Expected Changes Safeway Inc. ‘s customer base is the general local population; changes in the composition of the customer base are as follows: income, age and how age ffects a customer’s shopping needs. For instance, aging baby boomers want smaller packages and make smaller purchases because they no longer have family at home or they don’t want their food to spoil.
Another example is the average single adult who may not want to shop at competing grocery stores such as Costco, which sell larger quantities of items. With income being a factor and shoppers striving to be healthier, Safeway is offering a multitude of options for healthier living. Safeway is looking more and more attractive as a solid investment compared to expensive places like Whole Foods, where one an end up spending top dollar for groceries. What Customers are Purchasing Through Safeway Inc. ustomers have easy access to purchasing their groceries from home via e-grocery and delivery; all through the utilization of the website and app. Items that can be purchased range from the everyday household to luxury and specialty ones. In their stores, Safeway offers services of deli, pharmacy, fuel, floral and gift delivery. Why Customers are Purchasing The reason that Safeway stands out to customers is because not only do they offer organic food options, but have also implemented a SimpleNutrition rogram that makes it easy for one to shop for products that fit personal nutritional needs.
Customers realize the quality of Safeway Inc. ‘s products and services, along with their commitment to try and meet their changing needs. Safeway attempts to bring forth innovation within the company, in hopes to appeal to more customers and bring them satisfaction. Essentially, Safeway Inc. is marketing themselves to consumers by being immersed in their local communities and expanding their horizons. Through offering more information by the use of their website and app, it has allowed customers to ealize what all Safeway offers, their goals and successes as a company.
Throughout the decade people have become more health conscious, environmentally friendly and active; Safeway is mirroring these changes and progressively keeping up with the consumer base. Therefore, consumers are going to Safeway Inc. for not only the convenience of products and services but for the good impression they leave on each satisfied customer. Order Qualifiers and Winners A motto held near and dear to Safeway Inc. is “Ingredients for life.