Bargaining Power of Customers
The bargaining power of customers relates to the amount of pressure the customers have the ability to place on the business. When it comes to Wegmans, the customer has a strong bargaining power. Due to the fact that a customer can just walk out and go get something somewhere else for cheaper, Wegmans has to work with the customer to make the deal or transaction happen.
The bargaining power of suppliers describes the level of ability that suppliers have in influencing the company. The bargaining power of certain suppliers is great while others not so much. The department I will be focusing on is the produce department so in terms of that, the bargaining power is fair. Depending on the item and what season it is/ ease of getting it in all effect the bargaining power. Most items, we try to get in wherever they are in season, and being in season there, we can just look around to all the suppliers in the region and that way we can get what we need for around the price we want. When it comes to the local growing season, we get items for cheaper, and that way we can sell them cheaper to consumers, but during the winter time the prices go up due to supply. Something as little as a 4 ounce package of blueberries goes from $1.99 during the summer, to as high as $7.99 during the winter all because of supply and demand. During the summer months, we can get our blueberries local, while during the winter months, we the majority of our berries from Chile because it is in season and it is close to the price that we are looking for.
There are threat of substitutes. Instead of going and getting something fresh and in season, a consumer can just go over to the frozen section and buy the same item frozen all because of a cheaper price in that area. There's always the threat of substitutes but during colder seasons, there isn't much that Wegmans can do about the pricing of certain produce items.
Threat of New Entrants
The threat of new entrants relates to the ease of entrance for new competition to enter the market. There are already well established businesses and competitors all around so the chance or threat of new entrants is quite low. Honestly, the only type of business that does seem to do well is the local farmers market, but even when they do open up for the season, it is only temporary and they don't nearly have the numbers that a business like Wegmans does.
Industry Rivalry
Rivalry refers to competition in the market. Currently
there is a lot of competition in the area. We have an A&P, Stop and Shop,
Costco, Walmart, Target, and especially Whole foods. The list can go on and on,
but we separate ourselves on the base of our produce department and also our
prices. We try to get the cheapest prices around. The only issue is Whole
Foods. Whole Foods is our biggest competitor and there is actually a new one
opening up about two miles down the road from our location.
Competitive Strategy
Competitive Strategy
Wegmans is a family-owned supermarket chain with more than 83 stores spread across the mid-Atlantic and northeast region, in New York, Pennsylvania, New Jersey, Virginia, Maryland, and Massachusetts. About fifty percent of the Wegmans store locations are located in the Buffalo, Rochester and Pennsylvania
area.
The company’s product line comprises of beverages, grocery items, seafood items, bakery, supplies, floral products, cosmetics, seasonal food, especially the produce department, pharmacy products, gift cards, dairy, personal care, floral, pastries, and restaurants. Wegmans also provides cookware, tableware and other accessories. Some Wegmans locations even offer a liquor department if they have a liquor license.
The Wegmans competitive strategy is narrow and focus differentiated. Unlike Wal-Mart and Whole-Foods, Wegmans is focused on segment market like the Buffalo, Rochester and Pennsylvania area. In 2010, Wegmans had opened the first local store in Massachusetts but with things like sustainability in mind, Wegmans is trying to get more focused on the local stores rather than expanding stores to other states.
Wegmans has inability to absorb price increases due to the small scale versus national competitors like Wal-Mart. But Wegmans provides differentiated service and product lines. Wegmans provides the nutrition facts, food receipts, Seasonal food catalogs, and special diet information and organic foods all for consumers needs and wants. By using the Wegmans Smartphone App, customers can make the shopping lists what they want to buy and they could save their time and money by making the shopping list. The app also allows you to scan the barcodes on items, and it will tell you all the
nutritional facts about the item, the price, where its located, and some more info on the item. The app is very helpful when shopping or even working at the store. Also, they provide a cooking school event for kids, Wi-Fi internet Access, Wkid Fun center for kids, food bar (with no tipping), Pub and liquor store in some locations, and the ability to refill your pharmacy prescriptions online.
area.
The company’s product line comprises of beverages, grocery items, seafood items, bakery, supplies, floral products, cosmetics, seasonal food, especially the produce department, pharmacy products, gift cards, dairy, personal care, floral, pastries, and restaurants. Wegmans also provides cookware, tableware and other accessories. Some Wegmans locations even offer a liquor department if they have a liquor license.
The Wegmans competitive strategy is narrow and focus differentiated. Unlike Wal-Mart and Whole-Foods, Wegmans is focused on segment market like the Buffalo, Rochester and Pennsylvania area. In 2010, Wegmans had opened the first local store in Massachusetts but with things like sustainability in mind, Wegmans is trying to get more focused on the local stores rather than expanding stores to other states.
Wegmans has inability to absorb price increases due to the small scale versus national competitors like Wal-Mart. But Wegmans provides differentiated service and product lines. Wegmans provides the nutrition facts, food receipts, Seasonal food catalogs, and special diet information and organic foods all for consumers needs and wants. By using the Wegmans Smartphone App, customers can make the shopping lists what they want to buy and they could save their time and money by making the shopping list. The app also allows you to scan the barcodes on items, and it will tell you all the
nutritional facts about the item, the price, where its located, and some more info on the item. The app is very helpful when shopping or even working at the store. Also, they provide a cooking school event for kids, Wi-Fi internet Access, Wkid Fun center for kids, food bar (with no tipping), Pub and liquor store in some locations, and the ability to refill your pharmacy prescriptions online.
Wegmans has inability to absorb price increases due to the small scale versus national competitors like Wal-Mart. But Wegmans provides differentiated service and product lines. Wegmans provides the nutrition facts, food receipts, Seasonal food catalogs, and special diet information and
organic foods all for consumers needs and wants. By using the Wegmans Smartphone App, customers can make the shopping lists what they want to buy and they could save their time and money by making the shopping list. The app also allows you to scan the barcodes on items, and it will tell you all the nutritional facts about the item, the price, where its located, and some more
info on the item. The app is very helpful when shopping or even working at the store. Also, they provide a cooking school event for kids, Wi-Fi internet Access, Wkid Fun center for kids, food bar (with no tipping), Pub and liquor store in some locations, and the ability to refill your
pharmacy prescriptions online.
Even if, they can’t make the prices lower than national competitors, they still can increase the awareness and reputation by using the locally grown products. And it also contributes the development of local economy. Local grown, especially in the jersey area is huge. We support
our farmers as much as we can and buy doing this, we can sell local produce at discounted prices compared to out of season pricing. Since 1974, Wegmans started departments dedicated to seafood, carrying their own name to provide the highest-quality, freshest, affordable seafood to customers. Wegmans also encourages suppliers to start adopting farming standards and regulations. By doing that, Wegmans hopes to reduce the negative impacts on local wildlife and ecosystems and minimize or eliminate the use of wild fish in the feed, pesticides, and antibiotics. They always examine the seafood by quantified organization like MSC(Marine Stewardship Council), the global aquaculture alliance and state/country conservation and quota systems. So customers have credibility from the Wegmans seafood department and increasing the frequency of buying Wegmans products even if price is slightly higher than other competitors.
And Wegmans supports this effort through a companywide focus on Organics, their Organic Farms, Local reduce, Reuse, Recycle and sourcing products from trusted partners.
organic foods all for consumers needs and wants. By using the Wegmans Smartphone App, customers can make the shopping lists what they want to buy and they could save their time and money by making the shopping list. The app also allows you to scan the barcodes on items, and it will tell you all the nutritional facts about the item, the price, where its located, and some more
info on the item. The app is very helpful when shopping or even working at the store. Also, they provide a cooking school event for kids, Wi-Fi internet Access, Wkid Fun center for kids, food bar (with no tipping), Pub and liquor store in some locations, and the ability to refill your
pharmacy prescriptions online.
Even if, they can’t make the prices lower than national competitors, they still can increase the awareness and reputation by using the locally grown products. And it also contributes the development of local economy. Local grown, especially in the jersey area is huge. We support
our farmers as much as we can and buy doing this, we can sell local produce at discounted prices compared to out of season pricing. Since 1974, Wegmans started departments dedicated to seafood, carrying their own name to provide the highest-quality, freshest, affordable seafood to customers. Wegmans also encourages suppliers to start adopting farming standards and regulations. By doing that, Wegmans hopes to reduce the negative impacts on local wildlife and ecosystems and minimize or eliminate the use of wild fish in the feed, pesticides, and antibiotics. They always examine the seafood by quantified organization like MSC(Marine Stewardship Council), the global aquaculture alliance and state/country conservation and quota systems. So customers have credibility from the Wegmans seafood department and increasing the frequency of buying Wegmans products even if price is slightly higher than other competitors.
And Wegmans supports this effort through a companywide focus on Organics, their Organic Farms, Local reduce, Reuse, Recycle and sourcing products from trusted partners.
Focus Differentiation
|
·
Focus on segment market
(Especially, Buffalo,
Rochester, Pennsylvania)(50%)
·
Strong brand power from segment market
(high reputation,
awareness)
·
Provide many services – (App shopping service,
Wifi-service, Seasonal catalog, Refilling the prescription, Food diets and
receipt on the web, Etc)
·
Make a customer as family – (Wkids fun center,
event of cooking school)
·
Provide High-quality seafood with credibility
(examined by MSC, other official organization)
·
Contribute the economy advance- (using the
local grown products)
|
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