Customer Service

Establish decision criteria.

1. My company’s [stated or implied] vision is: Publix implied vision is to be, “… dedicated to customer service and community involvement, and being a great place to work and shop.” (Posts, 2021)

1. My company’s mission is: “Our Mission at Publix is to be the premier quality food retailer in the world” (Home, 2021).

1. My company’s values are: “To that end, we commit to be: Passionately focused on customer value, intolerant of waste, dedicated to the, devoted to the highest standards of stewardship for our stockholders and involved as responsible citizens in our communities.” (Home, 2021)

1. My company’s generic competitive strategy is: A differentiating strategy of superior customer service and developing its employee resources in a unique way as owners to build the superior customer service. (Kritzer, 2018)

1. The main constraints (geographic, resource, etc.) on my company are: Geographic reach due to only serving Florida, Georgia, Alabama, South Carolina, North Carolina, Tennessee and Virginia while two largest competitors (Kroger and Albertsons) operate in 35 and 34 states respectively. (Fernandez, 2020) Additionally, Publix has not invested in technology at the level that some of its direct or indirect competition which may impact customer perceptions of convenience. (Kritzer, 2018)
2. My company’s top strategic goals are: Publix strives to succeed in a highly competitive environment by focusing on, “…customer service, product quality, shopping environment, competitive pricing and convenient locations.” They emphasize these core strategies to differentiate it from its competition and facilitate opportunities for market share and growth. (SEC Form 10-K, 2021)
3. My company’s top financial goals are: Publix’s financial goals include continuing to increase sales and profits year over year, meet its cash requirements from internally generated funds and continue to offer a valuable stock and dividend to its employee owners. (SEC Form 10-K, 2021)

Collect and analyze data.

1. The most attractive opportunity in my INDUSTRY is: Increase in grocery shopping by households due to COVID restrictions and desire from those same shoppers for in store experiences once COVID restrictions are lifted. (Ellison, McFadden, Rickard, & Wilson, 2020)
2. The most pressing threat in my INDUSTRY is: Rising fuel costs related to recent storms in Texas as well as a shift to encourage green energy that may increase transportation and supply costs. (White, 2021)
3. As related to pursuit of the most attractive industry opportunity and defense against the most pressing industry threat, my company’s biggest strength is: Publix’s increased sales numbers for 2020 demonstrate it is already taking advantage of the increased grocery shopping as COVID restrictions are still in place in by providing a high level of customer service including its implementation of its Instacart solution in 2016. However, to continue to take advantage of that opportunity and the customer desire for experiences once restrictions ease, Publix will have to manage its distribution and transportation costs tightly and take advantage of some of it Greenwise “experiences” for customers in other traditional Publix stores.
4. As related to pursuit of the most attractive industry opportunity and defense against the most pressing industry threat, my company’s biggest weakness is: Publix biggest weakness in taking advantage of the industry opportunity is its lack of previous investment in technology. There may be opportunities to improve distribution processes or offer enhanced customer experiences via new technology but Publix will need to close the gap quickly.

Evaluate performance.

In the context of industry averages and close competitor data, how is the company performing:

1. financially?

Publix has a strong financial position. Gross margin for 2020 was 27.88% while the industry average was 22.85% and Publix outperformed Kroger ($3.27) and Weis Markets ($3.70) with an EPS of $5.67. (SEC Form 10-K, 2021)(Grocery, 2021) Its Current Ratio is 1.01, much higher than Kroger at .14 and Weis at .73 indicating a much stronger position to stay solvent in the short-term. (SEC Form 10-K, 2021)(Grocery, 2021) Its Cumulative Return based on Fiscal year end stock trading price has outperformed its peer group (Ahold Delhaize, Kroger and Weis Markets) for the last five years and in 2020 was 156.02 versus 111.48 for its peer group. (SEC Form 10-K, 2021)

1. strategically?

Publix is performing well on its customer service and employee relations strategy. Publix tied for second in the supermarket industry in the American Customer Satisfaction Index (ACSI®) Retail and Consumer Shipping Report 2020-2021 (Links to an external site.) with a score of 82 while Trader Joe’s took the top spot at 84, while the industry declined 2.6% on average to 76, showing that they are staying at the top of the pack for customer satisfaction. (DiMeglio, 2021) They also have high rankings in recent years for job security, best company to work for and largest majority employee-owned company indicating their strategic focus on employee development and respect is successful. (Home, 2021)

Define the problem (see your biggest internal weakness, above, before completing this section).

Complete the chart of symptoms (e.g., decline in sales, slipping profit margins, etc.); trace each symptom to its root cause that is under the control of the company (not external, like “COVID,” etc.); evaluate problem significance in light of most promising industry opportunity(ies) in #2, below). Any given problem may have one or more symptoms, and vice versa, so duplications are likely.

Symptoms	Instacart orders growing	Customer Service Ranking #2 versus #1
Underlying Internal Problem(s)	Partnering versus in house technology investment	Use of 3rd party for delivery/online order prep versus Publix employee touchpoint

My company’s most pressing problem or issue is: Use of a third party (Instacart) to assemble online orders in Publix stores and deliver to customers is reducing touchpoints with customers and reducing the impact its strategic focus on the value of employees and customer satisfaction.

Identify and evaluate solutions.

1. Three feasible solutions to my company’s biggest problem are:

1. Develop on inhouse solution to replace Instacart

2. Redefine relationship with Instacart so that more of the customer contact is with Publix employees

3. Develop a solution with a different third party that emphasizes customer contact with Pubix employees

1. In light of our decision criteria (#1, above), the most effective and efficient of these solutions is:

Develop an inhouse solution to replace Instacart. This could bring a larger focus and investment on technology that could then be employed for other developments as well.

Defend proposed solution.

This solution will have the following effects on:

1. strategic performance: Expanding offerings that existing or new Publix employees can perform will support providing dignity, value and employment security to associates. Additionally, if their vision is to be premier worldwide, investment in technology will take it another step in that direction.
2. financial performance: Publix has shown it can deploy its resources in very effective ways to increase revenues, profit and grow its stock for its employees. With new in house technology, it should be able to grow its geographic reach and use such new resources in the most effective and efficient manner to strengthen its financial standing even more than today.

References:

DiMeglio, D. (2021, March 02). Press release retail and consumer shopping 2020-2021. Retrieved March 03, 2021, from https://www.theacsi.org/news-and-resources/press-releases/press-2021/press-release-retail-and-consumer-shipping-2020-2021 (Links to an external site.)

Ellison, B., McFadden, B., Rickard, B., & Wilson, N. (2020, November 04). Examining food purchase behavior and food values during the covid‐19 pandemic. Retrieved February 28, 2021, from https://onlinelibrary.wiley.com/doi/full/10.1002/aepp.13118 (Links to an external site.)

Fernandez, C. (2020, November). Supermarkets & Grocery Stores in the US Download Options. Retrieved February 28, 2021, from https://my.ibisworld.com/us/en/industry/44511/major-companies (Links to an external site.)

Grocery stores industry profitability. (n.d.). Retrieved March 02, 2021, from https://csimarket.com/Industry/industry_Profitability_Ratios.php?ind=1305 (Links to an external site.)

Home. (n.d.). Retrieved February 28, 2021, from http://www.publix.com/ (Links to an external site.)

Kritzer, A. G. (2018, January 29). If convenience and price drive grocery shoppers, how will Publix compete with Amazon, Kroger and Walmart? Retrieved February 28, 2021, from https://www.bizjournals.com/tampabay/news/2018/01/29/if-convenience-and-price-drive-grocery-shoppers.html (Links to an external site.)

Posts, R. (2021, January 27). Publix mission STATEMENT 2021: PUBLIX Mission & Vision Analysis. Retrieved February 28, 2021, from https://mission-statement.com/publix/ (Links to an external site.)

SEC Form 10-K for 2020. (2021, March 02). Retrieved March 02, 2021, from https://www.publixstockholder.com/financial-information-and-filings/sec-filings/sec-document/8718ac7b59a34fc0a8f7bb309b3e4d4e/html (Links to an external site.)

White, M. (2021, March 02). The price of food and gas is creeping higher – and will stay that way for a while. Retrieved March 05, 2021, from https://www.nbcnews.com/business/business-news/price-food-gas-creeping-higher-will-stay-way-while-n1259206