Kroger Company Harvard Case Solution & Analysis

Introduction

            Kroger is a United States based retailer that has been founded in the year 1883. The company was founded by Bernard Kroger who started off the company in Cincinnati, Ohio. The company has been one of the largest super market chains in the world. In terms of revenue, the company accumulated total sales revenue of $98.4 billion in the year 2013.

            Kroger is placed second to Walmart in terms of the size and stature. In the international market, Kroger is the fifth largest retailer in the world. The total number of stores for Kroger is approximately 2500 (Clifford, 2009). The headquarters of the company are in the city of Cincinnati. Moreover, the company has been present in more than 31 states of the country which indicates that it is one of the largest chains in the world. The stores included in Kroger are grocery stores, jewelry stores, convenience stores, departmental stores, super stores and supermarkets.

            It is also the parent banner for Ralphs. Along with this, the employees who work at Kroger are represented through the United Food and Commercial Workers (UFC). Along with this, Kroger has been saving a total of $372 where Bernard opened a grocery store in the Mount Airy neighborhood of Cincinnati. Kroger basically belonged to a family where his father was a merchant.

            In the initial phase, Kroger tried quite a few ways to fulfill and also satisfy the needs and wants of the customers. It is also one of the largest private label organizations in the county United States (Micek, 2001). Kroger has been offering a three tier marketing strategy to attract and retain customers. Moreover, it has been looking to gauge in customers through this strategy. It therefore includes the low cost products for the customers, the brands that are focused to compete with all the major leading brands within the local market.

            Finally, the company has been offering premium organic food also. In the initial phase, Kroger made breads where the theme or the idea was to offer customers fresh products. Moreover, the company has been offering its retail products through more than 780 convenience stores that are placed under the six banners and are located country wide in 19 states. The company has been keen to focus on the quality if offers to the customers.

            Along with this, the C-stores have been providing sufficient synergy and value which has helped Kroger to expand itself in the market. Moreover, it is the only retail company that actually offers and operates through the concept of three tier distribution system. Along with this, Kroger has been offering fuel centers where it has 1217 stop shopping strategy. Kroger even has more than 2000 pharmacies which are based on the everyday low prices business model (Clifford, 2009).

Section 01

Environment Analysis

Political Environment:

            Kroger basically operates in various countries across the globe. It is fact that Kroger has been quite influenced with the political and legislative conditions of all the countries where the company operates. Moreover, the company has quite a few retail stores in the world where it stands next to Walmart in terms of the supercenters in the country of United States specifically.

            Along with this, it has more than 2500 shops in 32 states of the country (O'Connor, 2000). Moreover, the company has been largely supportive of the retailers and it has also encouraged the company to rather expand itself in the market. It has been facing quite healthy support from the government where the company has looked to abide by the rules and regulations that need to be met within the industry (Gomez-Mejia, 2008).

Kroger Company Case Solution

Economic Environment:

            The economic situation of the country has been quite poor and has actually hampered the growth of the different industries including the retail industry where Kroger has been a reputed name. The reason for this slow growth has been largely affected due to the global recession of 2008 which has restricted the consumers to purchase in bulk. Although things have changed for the betterment of the industry and customers do find themselves purchasing in bulk quantity now.

            Since the economic recession, the company reduced its marketing and advertising expenses. Moreover, the increase in the labor cost and the rise in fuel prices has also been hindrance in growth for the company and it has actually shrunken the profits for the company in the recent times. The supply chain cost and the logistics prices have increased simultaneously. In spite of the tough conditions, Kroger has been determined and keen to offer customers with optimum quality products. Kroger has also been quite badly affected with the increase in tax rates, the inflation rates, etc (O'Connor, 2000)...............

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