Team CHIC Position Statement

[snk...@yahoo.com]

Problem Definition

Loblaw faces an array of difficulties. Loblaw’s performance is
currently declining and the threat of incumbents as well as new
entrants is strong. Loblaw’s reputation for quality and value is
diminishing and consumers are highly dissatisfied with its current
product offerings and service.

[rddiaperman]

Well, I have to respond in the same way as all the responses to Team
Cutting Edge's posting, what action steps do you determine were needed
to correct the issues Loblaw was experiencing?

Mark

[tiffany neff]

I agree with you Mark, what is your position for the future? What does
Loblaw need to focus on to face those difficulties?

> > product offerings and service.- Hide quoted text -
>
> - Show quoted text -

[Jonathan Nutter]

Loblaw saw their clientel moving down market, their discount items was
going from 50% to 75% of sales. That is why Walmart became their
competitor. At that point Loblaw had a choice of 2 options. 1- they
could attempt to bring their stores back upmarket, posistioning
themselves as a Canadian Target, or 2- develop a distrabution system
that could equal Wal-marts. The problem was the old management team
did not recognize this and the new management team was behind the
eight ball to start with. It took them 100 days to develop the
benchmarks compared to Wal-mart and it will take them a long time to
try and develop equivalent ones.

[tiffany neff]

I see what you are saying Nutter, so it is kind of like LEGO it was a
old management team that was stuck in their old ways and neither
company recognized their efficacies until after the fact. Like LEGO
realized they needed to fix their supply chain after outsourcing to
Flextronics and Loblaw recognized a problem with their positioning in
the market after they were losing clientele. So old management in both
cases was stuck in their old ways and not willing to make change.

[Amy Fassold]

John and Tiffany, you both bring up good points that we didn't really
think about. We saw Loblaw as trying to change what they stood for in
an effort to compete with Wal-Mart because they didn't think they
could survive focusing on quality and freshness of the products it had
been offering to consumers.

Asking about what the company should do is similiar to a question Rob
already asked.

Short-term Loblaw needs to focus on inventory control by clearing out
excess and improve stocking. Another improvement they can make is to
restructure their stores to be more user friendly. Customers were
grocery shopping and would have to walk around general merchandise to
finish their shopping.

Long-term changes require restructure of the distribution system and
to regain focus on its core competency or decide to change its core
competency. The company was once known for its quality and
freshness. It either needs to go back to that or create a new focus
and start over again.

> > try and develop equivalent ones.- Hide quoted text -

[Curtis Lucas]

I see statements about reputation but I am curious as to what as to
what Loblaws core competencies are? We know that walmarts core
competencies are supply chain logistics and inventory management.
They only ventured into grocery to leverage their supply chain
competencies. What made Loblaw feel that they had competenceis that
would allow them to levrage their way into the discount/big box market
given that was not their strength.

> > - Show quoted text -- Hide quoted text -

[Gini Stieger-Lawson]

Jon and Tiffany, I agree with Amy, those were ideas we hadn't
considered. The first option Jon mentioned, to be a higher end store
such as Target would have been a good option for Loblaw. Instead,
Loblaw decided to try to compete with Walmart in the area where
Walmart is expert. Loblaw did not have the experience in distribution
or in discounting.

On Nov 23, 1:17 pm, Amy Fassold <fassol...@yahoo.com> wrote:

[Gini Stieger-Lawson]

Loblaw's competencies were in groceries. The company had a reputation
for high quality produce and grocery products and was the industry
leader as a grocer. Loblaw entered into the discount market because
they thought they would lose market share if they didn't change their
strategy to compete with Walmart.