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Food Lion Inc. Essay

3291 words - 13 pages

1. EXECUTIVE SUMMARYThe following is an overview of the case analysis of Food Lion, Inc. The overall environment for Lion Food and it's competitors is changing from a product-oriented atmosphere towards an emphasis on satisfying all of a consumer's needs. In order for Food Lion to remain competitive it wants to re-evaluate its future opportunities for growth without compromising it's profits.Industry-wide, grocery chains are changing the importance on satisfying the consumer in order to keep their profit margins high. Some examples include the move towards a 'superstore' witnessed by some of Food Lion's competitors. Here, customers have a 'one-stop' shopping experience. This is conducive to generation of dual-income families and a growing amount of adult singles with busier lifestyles who value time saving measures which also provide convenience.A microscopic look at Food Lion shows that their principal strength is their low pricing strategy which gives them a competitive edge. On the other hand, Food Lion's sales are relatively low and are slow to increase which is their main weakness. Outside opportunities available to Food Lion include the consumer's desire for low price shopping and convenience. External threats facing the company are Food Lion's competitors moving towards the 'superstore' format in response to customer's desired.Our group felt that Food Lion's main problem was that it had an unbalanced marketing mix. It focused it efforts toward the pricing portion, but failed to also accentuate the product, promotion, and distribution areas. Symptoms indicative of this problem include their declining sales, low name recognition and low quality products. This causes a problem for Food Lion if it were thinking of becoming a superstore because these factors would then make it difficult for them to gain an edge in a market already dominated by other competitors with low prices. With other marketing variables involved, Food Lion would not survive on it's low pricing strategy alone.As a result of this dilemma, our group felt that it was most prudent to adopt a more comprehensive solution for Food Lion and it's marketing mix. The alternative we most favour was the adaptation of a larger store format, but not a superstore size, with some additional services to satisfy their customer. Each store format market target market strategy would depend on the specific demographics of the area chosen. We would also suggest that Food Lion follow up with a study after a period of time to determine the success of the new services and additional products based on sales and profit margins. The following is an in-depth look at our findings and the reasoning behind our recommendation.2. ENVIRONMENTTechnologyTechnology has also changed the shopping arena. Shoppers soon will be able to order tomatoes, flour, cereal, and other grocery items via home computers. For many years Food Lion has been a leader in its use of technology in it's stores, distribution centers, and...

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