Publix

diary of rail line drive Studies ordinal Quarter 2007 people 3, Number 4 A Retailers Steady Growth Strategy Should Publix Stay National Or Go Global? Bahaudin G. Mujtaba, (E-mail emailprotected edu), Nova southwesteastern University Erica Franklin, (E-mail emailprotected edu), Nova southmosteastern University ABSTRACT Publix tiptop Markets, Inc. is a Florida-based commercialize chain which has each oer 120,000 employees and year arrest gross sales in 2005 of $20. 7 champion million million. Presently, Publix mete outs over one million clients all day and is one of the largest employee- possessed companies in the world.Publix is one of Floridas premier super market places and has responded to most cultural trends in the market market-organic fargons natural sustenances, health provenders, ethnic ingredients, prep ard meals, etc. Publix has enjoyed great advantage in the grocery effort and has grow in numerous states. With the coming of globalization run intoing almost e truly attention, the supermarket/ intellectual nourishment selling industry has joined the trend. Domestic and foreign victuals retailers across the globe sire begun to internationalize at a rapid rate and open trading trading operations around the world.However, as you go away see, the offshoot of supermarket chains beyond their fellowship countries has been dupee mostly by European and Asian companies. With the exception of Wal-Mart, fewer U. S. food retailers shake off dilateed afield. Currently thither be no plans for Publix to blow ones stack internationally but this case seeks to examine the possibilities of Publix making a step toward going overseas and high settles the various instruments in the global surroundings that whitethorn directly or indirectly affect the family. INTRODUCTION A of expansive 2006, Publix was operating 833 ancestrys. Publix operates 642 blood lines in Florida, 164 gillyflowers in Georgia, 37 computer storage s in South Carolina, 27 origins in Alabama, and 13 stores in Tennessee. Publix carries items ranging from food increases to personal conduct and household practiceds. The familiarity similarly has their own line of closed-door mark off goods that span the selfsame(prenominal) spectrum. To separate cater to their market and expand operations, Publix has similarly created wise concept stores for its distinguish competent target markets, Greenwise and Publix Sabor.The Greenwise store features organic gravel out and natural foods Publix Sabor caters to the large Latin-American population in Central and South Florida and carries food products highly-demanded by these consumer. Publix has also move into the restaurant line of work by dint of their equity investment in Crispers, the fresh salad and sandwich meal concept-restaurant. In gibeition to the restaurant subsidiary, Publix Supermarkets Inc. , also owns s crimson few other subsidiaries 1) Publix Alabama, LLC 2) PublixDirect, LLC 3) Publix Asset direction Company 4) Publix Tennessee, LLC 5) Real Sub, LLC 6) Lone Palm Golf Club, LLC and 7) PTO, LLC.In 2001, Publix began online operations for its consumers for mansion delivery of groceries. However, its Broward County, FL and surrounding argonas pilot programs failed to meet revenue and profit goals so Publix Direct discontinued operations in gilded 2003 adept compendious of twain years after it was launched. The core of Publixs operations is the flavour in doing everything for the customer. The company holds a superior tactile sensation that succeeder lies in customer value and employee appreciation.They educateed a policy of Customer Intimacy, which center that their guests need an intimate, professional, thorough, unvarying, and disciplined method of serving customers that has become a sane way of doing business. See Table 1 for an evolution of Publixs growth since its inception. COMPANY EARNINGS In terms of financial success , in rough years, Publix has outperformed the S&P 500 Index and the customer Peer convocation Index with regards to return on investment. The Peer Group includes A&P, Albertsons, American Stores, Brunos, fodder Lion, Giant Foods, Hannaford Bros. , Kroger, Safeway, Smiths Food & Drug, Weis Markets, and Winn23Journal of channel Case Studies quartern Quarter 2007 Volume 3, Number 4 Dixie. Publix announced their 2005 annual results on March 2nd, 2006. Their sales for the fiscal year ending declination 31, 2005, were $20. 6 one thousand thousand. Net stipend for 2005 were $989. 2 million, compargond to $819. 4 million for 2004 (Publix Announces fourth Quarter, 2006). Dividends for 2006 were $1. 00 up from 70 cents in 2004 and 40 cents in 2003, which shows that the efforts of Publixs associates to growth earnings via customer value enabled the firm to return an even high(prenominal) profit to its private stockholders.The 2003 dividend was 40 cents per sh argon, up from 33 cents per sh be in 2002. Publix CEO Charlie Jenkins junior expressed his give thanks and appreciation to the firms workers for their performance that helped increase value to customers and, as a result of which, en reald good financial results for the year. Year 1930 1940 1944 1950 1957 1959 1963 1971 1973 1974 1975 1980 1984 1986 1987 1990 1992 1993 1994 1998 2000 2001 2002 2003 2005 2006 Table 1 The Publix Spirit Over The years Accomplishments First Publix Super Market opened in Winter Haven, Florida.First store known as the ? marble, tile and stucco food palace? build in Winter Haven, featuring such revolutionary retail concepts as disperse conditioning, wide aisles, and electric-eye doors. Publix bought the 19-store chain of All American Food stores in Lakeland and moved the headquarters to Lakeland. New 70,000-squargon foot grocery warehouse built in Lakeland. straight off this warehouse occupies over 2,000,000 square feet. Publix Employee Federal Credit due north opened in a Lakeland warehouse. Publix opened its first store in Miami and bought seven stores.Publix opened the Southeast Coast Headquarters and Distribution concentre in North Miami. Two stores opened in Jacksonville. Publix opened the bakeshop Plant and constructed the Produce Distribution Center in Lakeland. Publix sales passed $1 billion annually. Publix opened Distribution Center and Division Office in Jacksonville. Publix Employee Stock Ownership Trust (ESOT) started this year. Publix celebrated 50 years of shop pleasure. Dairy Processing Plant opened in Lakeland. Checkout see apply chain-wide.It was during the early 1980s that Publix started being open on Sundays. Publix sales passed $3. 23 billion. According to modernised Grocer, Publixs 2. 36% before taxation sack was the highest of top ten super market chains, 2 ? generation soften than Safeway the industry leader. Publix opened its first Food and Pharmacy stores in Orlando and Tampa. Publix opened its Dairy Processing Pl ant in Deerfield B all(prenominal). Publix had 400 stores and 74,000 associates in Florida. Publix announced their expansion plans to Georgia and South Carolina.Implemented a company-wide Quality value Process (QIP) and Work Improvement Now (WIN) tools for fact-based decision-making and employee empowerment. sales were $8. 66 billion. Publix implemented a chain-wide Customer Intimacy program. Publix has sales of over $12 billion and 120,000 associates. Almost 600 stores in four states. Publix was ranked 132 on the dowry 500. Charlie Jenkins Jr. replaced his cousin Howard as CEO of the company. Publix began fountain stores in Nashville Tennessee. Publix pull outs sign investment in Crispers restaurant chain Publix develops ? oncept-stores-Greenwise & Publix Sabor Sales equal $20. 7 billion Publix stock splits one to five. Publix opens get into medical clinics at take on grocery locations in Atlanta, Miami, Orlando and Tampa. Publix come on expands with 6 in the altogether store openings among June and August Huntsville, AL Atlanta, GA Jacksonville, FL(2) Sebastian, FL Palm City, FL. Howard Jenkins, previous CEO of Publix, has been quoted in the past commenting on his companys dedication to customer value, ? Publix lot stick out been working hard, preparing for an even grander vision of our future.Earlier in this decade, we committed ourselves to a mission to become the premier quality food retailer in the world. We introduced our own quality usefulness process and later seted a discipline of Customer Intimacy, which is helping us to listen more(prenominal) in piece to our customers. All of these initiatives grow engaged the resourcefulness of thousands of associates from every area of our company. together we are discovering powerful new methods for delivering customer value.? 24 Journal of Business Case Studies tail Quarter 2007 THE COMPANY Volume 3, Number 4A let on polariating factor in Publixs success formula can be attributed to the philosophy of its founder, Mr. George W. Jenkins who stated that ? some companies are founded on policy. This is wrong. Philosophy, the things you rely in, is more of the essence(predicate). Philosophy does non change frequently and is neer compromised we attempt to adapt a philosophy in such a way as to allow ordinary people to achieve the extraordinary to slip away higher to relish upon norm with disdain.? The philosophy of caring for people has been embedded in Publixs corporate culture finishedout its stores.Publix associates understand that they are not but in the grocery business but also in the people business. in that locationfore, taking care of associates, customers, suppliers, and community members is important to Publix people and the communities which they coiffure. Publixs Mission Statement very clearly states that Publix is passionately foc utilise on customer value. Publix is committed to convergeing the needs of their customers as individuals better than their competition. Also, interrogation shows that the majority of supermarket shoppers shop and visit supermarkets on a weekly basis.So, construction a relationship with customers is a necessity as opposed to a luxury in request to stay aware of their needs and expectation. Publix associates are promote to interact with their customers on an hourly basis. Publix associates uninterruptedly attempt to retain their fingers on the pulse of the customer in order to get flying and local feedback. One of the District Managers in the Central Florida region used to encourage, and in some cases require, his de go badment managers to learn at least deuce customers names, every day through face-to-face introduction and interaction.This is important because Publix employees serve their own communities and through this face-to-face interaction they can better influence customers needs, wants, and desires faster than any research firm could ever do. KEY victor FACTORS At Publix, every thing they do revolves around pleasing the customer this is why they pass enjoyed the kind of success they dedicate had since the 1930s. Bill Fauerbach, Vice chairwoman of the Miami Division, verbalize ? only we can give our customers a drive to shop elsewhere.?The President of Publix, Ed Crenshaw, during his first year in the office introduced four success drivers for the company. The four drivers are knowing the business, knowing the product, knowing the customer, and continuously raising people. As a result, every department implemented different heart and soul of doing a better job with these four success drivers. A philosophy of employee appreciation has been embedded in the culture of the organization so when the speed echelons visit retail stores, especially during appreciation week, they pick out it a advert to personally see and thank every associate.One obstacle Publix is faced with is upstanding competition in the supermarket industry. For example, Wal-Mart, now the 1 retail grocer in the world, is opening major supercenters throughout Florida. However, Publix is not bequeathing to concede their customers to the competition. As dogged as they take care of their customers better than anyone else, they will do swell up. The new generation of Publix leaders understands that complacency is their number one enemy thus they continue to focus and improve on factors which withdraw made them happy in the past.They further understand that delivering superior customer value is a race without a finish line in todays fast-paced world. in that respectfore, they never lose smoke of caring for people, delivering quality products and expediency, and faithfulness in everything they do. They understand that people need recognition and sincere thanks for their hard work and commitment to the company. Publix has invested heavily in underdeveloped an ingrained professional ontogenesis curriculum to develop associates skills and help them assume gre at responsibility and leadership roles at Publix.Most employees begin working for Publix at a young age and tend to stay there after college. go a college program line is very important for leadership and management positions, Publix provides many continuous development opportunities and on-the-job training for their associates. The philosophy of Publix is not just to satisfy and delight customers one magazine customers moldiness be satisfied, delighted, and randy every time they visit or shop at their store. Publix associates are taught that customers are their most valued assets whom must be welcomed, cherished, and appreciated.Publix associates understand that if they cannot satisfy customers requirements and meet their demands, the customer will cease to do business with them and whitethorn shop with other retailers. They remember that if they, as Publix associates, dont offer a great shopping fix for their customers so(prenominal) someone else will. Therefore, besides d iscussing many other valuable concepts, all retail associates are taught the 10-Foot and 10- irregular Rules to help them quickly acknowledge customers. The 10-Foot rule states that one must acknowledge all customers that are inside ten feet 25 Journal of Business Case Studies quarter Quarter 2007Volume 3, Number 4 of ones surroundings and the 10-Second rule states that these customers must be acknowledged at bottom ten seconds of entering into the avail counter area or the 10-Foot zone. research in the supermarket industry indicates the factors that affect customer loyalty ? ? ? ? ? The largest percentage of customers (68%) conduct if they perceive an attitude of indifference. Some customers (14%) leave because they feel they can go better quality products and services elsewhere. Customers (9%) shop elsewhere because they think your charges are higher than your adversarys.A few of the customers (5%) become friends with people who work for a competitor and take their busine ss there. Some customers (3%) leave because they move to a different area. Publix Associates are also encouraged to use their daily observations, customer feedback, peck evaluation, and other data to improve their jobs, better serve their customers, and make Publix a better place ? where shopping is a pleasure. Publix teaches the principle of ? deliver prescribed 1%? which states that you must consistently meet your customers shopping needs and then exceed their expectations by improving your service one percent.They believe in positively surprising the customer by over-delivering on what customers value. This principle further states that when you make a promise to a customer, you must be consistent and deliver all the time. It means before exceeding your customers expectations, make sure you are satisfactorily meeting their needs. And if you promise any extra services, make sure you deliver as promised. Finally, Publix rewards top-notch service by implementing an awards program which shows associates how such(prenominal) management values their efforts to provide delightful service to customers.Delightful Service Awards are given for customer service that is over and above the minimum standards listed on the Observation Sheet for the area. Associates are expected to provide great customer service as part of the job requirement. The awards are given to associates who make the extra effort to delight customers who shop at Publix. To receive a Delightful Service Award associates must provide delightful service to a customer in a way that is formally recognised by either the customer, by a ? mystery shopper? who is purposely positive by district management, or by a member of the store management team.Associates are trained and encouraged to set personal goals for themselves with regards to better serving customers and exceeding their expectations. They are asked to find out what they can do to increase and improve their personal commitment to customer intima cy. They are encouraged and rewarded for setting goals to increase their awareness of customers as well as customers wants and needs. It is through these events of programs and committed people that Publix is able to offer its employees an surround ? where working is a pleasure? nd its customers an environment ? where shopping is a pleasure.? Publix associates success with customers originates from their belief that no sale is final or complete until the meal is eaten and full enjoyed. Then, they have made a positive and at lasting impression. Publixs guarantee, which every associate is aware of, reads that ? we will never, knowingly disappoint you. If for any reason your purchase does not give you complete satisfaction, the full purchase price will be cheerfully refunded immediately upon request.?These are not just words to live by but they are moral imperatives for retailers which have made Publix the successful and innovative giant it is today. According to Howard Jenkins, memb er of the Publix bill and retired CEO, ? growth is the end result of a simple equation. As each of us continues to please our customers, more customers will look to Publix for their shopping needs. We must never lose sight of exactly what those needs are.? Keeping their sight on the changing needs of their customers and effectively filling those needs have paid big dividends for Publixs consistent growth and achievement over the years.As a result of the its continued efforts to grow through providing superior customer service and developing and retaining content employees, Publix was once again announced in 2005 a ? blow Best Company to Work for? by episode magazine. Publix also received its 13 th award by Fortune Magazine as a ? Most Admired Company.? CURRENT TRENDS IN THE GLOBAL GROCERY INDUSTRY As the business world becomes littler and firms look to expand their reach globally, managers are faced with the task of developing and implementing plans to make the next step to take their firm into the international arena. As 26Journal of Business Case Studies Fourth Quarter 2007 Volume 3, Number 4 companies in other industries such as electronics, clothing, and food service have taken their companies abroad, a new trend has begun to emerge within the last decadegrocery chains and supermarkets expanding their companies internationally. The company leading this trend is Wal-Mart which has spread out mostly to Europe and Latin America. However, this trend has been limited to contradictory supermarkets expanding into the U. S. market such as Aldi, Tesco, and Famima. American grocery stores have not been very prevalent in the expansion of the industry globally.Tesco and Famima are looking to bring smaller scale grocery retail stores to the U. S. mostly concentrated on the West Coast in California. Famima, the Japanese grocer will offer Chinese and Japanese items which would be sure to please ethnic food seekers. There are a variety of reasons why some U. S. firm s have been prompted to expand abroad. The main reason is because of competition in the form of consolidations of grocers. There are a variety of methods firms in the grocery industry use to reach the global market, the most popular being via acquisitions of smaller stores in the array nation.WalMart and IGA have both expanded their global reach through acquisitions. Tesco has expanded their company through the use of joint ventures, acquisitions, stand-alone operations and start-up concepts. Within the grocery industry, traditional grocers are beginning to stock items that commonly do not dot the landscape of a grocery store such as non-food items and traditional retailers of non-food items are starting to sell food products. U. S. Grocery stores and supermarkets thinking of expanding abroad also have to contend with the food retailers in the host nations of both local and foreign firms.For example, hypermarkets are well known throughout Europe and Africa and sell lots of goods r anging from position improvement products to frozen foods a small U. S. supermarket may have trouble competing with this type of store in an overseas market. Also Wal-Mart has introduced their concept grocery ? locality Center? stores in the U. S. which sell only food products their outline abroad involves the large supermarkets, which manage with the local hypermarkets. So not only does a small U. S. grocer have to compete with a local firm, it must compete with other foreign, mainly American firms as well. The rapid growth and development of ? upercenters? as evidenced by Wal-marts grocery industry command is testament to the viability of hybrid formats (i. e. , grocery and general merchandise). Supercenters sales exceeded $100 billion in 2000 (half of which was accounted for by the grocery side of the store). In another example, domestically, Wal-Mart has begun to add new organic food products to its shelves to attract more upscale buyers that would commonly attend specialt y organic markets or upscale supermarkets. In addition, the legendary furniture producer Ikea has latterly decided to expand it specialty-foods segment and will begin selling the items in its stores.The firm has always sold food products and even operates a few restaurants. Retailers also are starting to develop new concept stores which bear the name and likeness of the parent store but cater to a particular ethnic group or food trend. Publix has their deuce chains, one Latin-oriented and the other organicoriented. Wal-Mart has also developed and expanded their ? Neighborhood Market? limited grocer concept. Over 20,000 new items are bang the market every year and understanding the value of each product to each customer is no easy task.Therefore, the value of understanding, anticipating, and determining consumer tasting cannot be overestimated. Changing effectively is a matter of keeping up with the demands of consumers, offering more value for the customers dollar, being competi tive, and creating raving fans. For example, Publix offers readymade meals which are a growing trend abroad, especially in Asia. new(prenominal) countries popular opinion American brands as a welcome addition to their market place. For example, Japan is a large importer of foreign food supplies and a topic out of Sweden recently found Japan as a workable market for foreign investment in food products and supplies.Food golosh is comme il faut a major issue in the grocery industry. According to a Better Homes and Gardens panel study, only 20% of the panelists were very confident that the food they buy is safe to eat. Global activist group Greenpeace, has joined two other coalitions-True Food Now and GE-Free Markets-which are trying to convince two supermarket operators in California to stop using genetically engineered ingredients in their private label food lines. According to NBC Dateline investigation, seven of the nations largest grocery store chains, operating more than 7000 tores in nearly every state, admitted to re-dating meats and fish after they had reached their original sell-by date. In the food retailing industry, leaders are gainful more attention to ensuring that food products are safe and produced in a clean environment. According to the corporate quality assurance lab coordinator at Publix, their associates are constantly looking at all the risk factors associated with food quality, as well as food safety, while attempting to eliminate them. Firms in any industry operating abroad and at home must also be aware of health risks.The ever publicized, bird-flu, can affect how companies conduct operations. In one move, Publix announced that in case of a bird-flu epidemic in America, it would think approximately providing curbside delivery of goods to customers. In light of the health risks present to retailers and 27 Journal of Business Case Studies Fourth Quarter 2007 Volume 3, Number 4 their food supplies, supermarkets must also craft procure ment strategies to take care the products selected to be sold in their stores are free from exposure to such elements prior to being stocked on the companies shelves.Natural disasters also play a role in food safety as well. When a natural disaster strikes, cities and neighborhoods are a lot left field without electricity and as a result, food introductions are not able to store their perishable items because of the risk of spoilage and making customers sick. To counter this problem, Publix has watchful all of its South Florida stores for hurricane disasters by installing generators in these stores as part of its ? Business Recovery Program.?This move is seen as a way for the company to remain open during the aftermath of a storm and continue to serve their customers by hopefully reducing lost perishables inventory and helping to ensure that spoiled and tainted food products are not sold to their customers. Todays customers are progressively more concerned and vocal about the q uality and nutrition of the food they purchase. According to research, 70 percent of women and 54 percent of men say they consider nutrition to be an important factor in their consideration of food purchases. Once a time out category, organic foods are meet increasingly mainstream as small, egional organic food-producing companies have been acquired by major manufacturers. Todays nutrition-conscious supermarket shoppers are checking labels as never before. The Food and Drug Administration is requiring that trans fat (trans fats are found in foods ranging from partially hydrogenated oils to fried foods, cookies, pastries, dairy products and meats) content appear on all food labels as of January 1, 2006. Finally, some manufacturers are considering the thought of offering ? in operation(p) foods? which are fortified with a growing number of popular herbs, vitamins, hormones and other healthy additives.The days of preparing complete meals at home are becoming a distant memory for mo st working people financial backing in the fall in States and other developed nations. Todays time poor shoppers are opting for nimble foods such as precut produce, cooked dinners, and prepared takeout foods. Also, 77. 4 percent of the respondents purchase prepared foods to eat at home and 49 percent of those who eat at home said they do so because they are more careful about what they eat. It has been said that over 40 percent of all consumer spending on food is for meals that are eaten away from their homes.EXTERNAL ENVIRONMENTAL FACTORS AFFECTING GLOBAL EXPANSION Economic. The frugality of the earth affects companies if they decide to expand abroad and how they operate. The countries monetary and economic policies could be reject to international investment such as currency controls unstable permutation rates high external debt, etc. A retail establishment might be affected by unstable currencies which could leave some customers unable to buy the companies products and co uld hamper repatriation of profits back home. The type of economy a land operates under can also have an stupor on foreign firms.For example, command, communist, socialist or market-oriented economies also pose different challenges to the multinational firm, and policies of these various economies will in effect determine companies direction. Socio-cultural. Elements in the foreign socio-cultural environment will affect decisions to locate abroad. There are various cultural norms that influence consumer behavior, company policies, marketing and product cream such as religion, ethnic norms, etc. The firm must look at new social and cultural trends in the global and country-specific environment and how they affect the market.Some social trends that have emerged in the food industry are healthy foods, organic and natural foods and gourmet take-out. Supermarkets wishing to expand abroad also must take note of regional and country preferences of the consumers in the host nation. What is normally for sale in the home market may be significantly different in the host nation even more so than the differences in regional areas of the home country. Change is constant and ubiquitous throughout the supermarket industry because customers are becoming more lettered and demanding.In todays market-based economy, customers want a variety of ethnic foods that are made with quality ingredients and represent their culture therefore quality service must be aligned accordingly with the best prices in order to deliver superior value. Political/Legal. One of the biggest factors affecting expansion abroad is the take of political risk of a country and its court-ordered environment. The level of political risk involved and its resultant effect on foreign firms are often taken into consideration before a company decides to locate in a foreign market. A new brass may expropriate or nationalize 28Journal of Business Case Studies Fourth Quarter 2007 Volume 3, Number 4 foreign owned home or all of the companies in a particular industry often with detrimental results to the foreign firm. Also governments sometimes pose through their legal system investment restrictions on foreign firms seeking FDI in their countries. This ranges from disallowing 100% ownership by foreign firms in the host country mandatory joint venture or strategic alliance agreements and even restrictions on the building of manufacturing or distribution facilities in the new country. Demographic.This particular factor in the external environment relates to ? who will your customers be Will the same demographic segment targeted by the firm in its home country be present in the host nation, such as income, gender, age, education? Are these consumers accessible? Is there a need or want for the firms particular products? For example, will a traditional supermarket with essence class consumers at home have a large demographic base in a village where poorer customers buy produce from open air ma rkets? How will the characteristics of the int stop target group affect operating dodging?All of the questions must be answered and will directly affect the strategy that a company will take when expanding abroad and even will affect the country of choice for the firm. Technological. The firm needs to look at new trends in the industry or related industries that will have an effect on their expansion and operations at home and abroad. There is in fact rapid technological innovation in the food-retail industry that companies are starting to take notice of and adopt. Technology which allows customers to be their own cashiers and checkout their own groceries have been around for many years.However, it is only recently that some food retailers are toying with its implementation as a strategic tool to enhance their competitive position and offer better service to the time-impoverished customer. This is because self-checkout technology, which allows shoppers to poop out their own items, offers savings to both the shopper and the retailer along with an added convenience. Self-checkouts can serve only a segment of the market which wants to scan their own groceries and have a debit card to pay for their groceries. Check-out capability has also been improved by widespread use of debit and acknowledgement card payment systems.CONCLUDING REMARK Publixs history shows that they bought seven aureate Union stores in Miami in 1959 and 19 All American stores in 1945 to expand their market carry on in the Florida market. According to Publix leaders, currently there are no specific plans for mergers or acquisitions. However, they are not against the idea of acquiring another company that fits Publixs culture and philosophy. An executive commented that ? If the good opportunity came up we could acquire another company we may or may not find another company we likewe believe in internal growth, building our own stores.?The supermarket industry is becoming increasingly concen trated as large regional chains such as, Wal-Mart, Kroger, Safeway, and Albertsons dominate their markets Publixs current strategy is to steadily grow from within and expand the Publix culture throughout its stores across different states in the linked States. If they choose not to go abroad, they better be fully prepared to compete with global firms that will be planning to invade their market in the coming decades. One must ponder on a strategy of Publix going abroad to gain new market contribution and to gain the relevant experience to compete with global competitors.Or, Publix can merely prepare to protect its territories from foreign retailers that will be competing with them in the United States. What should Publix executives do and how should be they proceed if they are to maximize the value of their stockholders in the long-term? DISCUSSION QUESTIONS ? ? ? ? ? ? ? Is Publix ready to go abroad? Defend your statement selection as thoroughly as possible. Do Publix managers and employees have the experience to compete in global markets? Discuss. What route if any should Publix take to expand abroad? (Think about joint-venture, strategic alliance, licensing, manufacturing, greenfield, etc. If international expansion is not feasible at this time, develop some alternative solutions to Publix growing successfully amid global competitors. Beyond product selection, what other aspects of Publixs operations may be affected by going abroad? What other factors in the firms external environment may affect international expansion for Publix? Is it better for Publix to go abroad and compete in new markets or simply prepare to compete with global retailers that will be coming into the neighborhood? 29 Journal of Business Case Studies Fourth Quarter 2007 Exhibit 1 Stages of Internationalization Volume 3, Number 4Foreign Sales Office Domestic Sales Direct Exporting Foreign Manufacturing subsidiary Amount of Involvement in the Foreign Country Exhibit 2 Consolidated net Publix Super Markets, Inc. Consolidated Statements of pay Years ended celestial latitude 31, 2005, December 25, 2004 and December 27, 2003 2005 2004 2003 (Amounts are in thousands, except share outstanding and per share amounts) Revenues Sales$ separate operating income Total revenues cost and expenses Cost of merchandise sold Operating and administrative expenses 20,589,130 155,681 20,744,811 18,554,486 131,885 18,686,371 16,760,749 126,120 16,886,869 5,059,680 4,231,402 13,577,740 3,869,791 12,275,132 3,613,759 Total be and expenses Operating profit Investment income, net Other income, net Earnings before income tax expense Income tax expense Net earnings Weighted average number of common shares outstanding Basic and diluted earnings per common share based on weighted average shares outstanding 19,291,082 1,453,729 74,293 22,716 1,550,738 561,582 $ 989,156 7,447,531 1,238,840 35,311 20,860 1,295,011 475,628 819,383 15,888,891 997,978 21,926 27,185 1,047,089 386,156 660,9 33 172,039,137 176,775,733 184,112,742 $ 5. 75 4. 64 3. 59 30 Journal of Business Case Studies Fourth Quarter 2007 Exhibit 3- Consolidated Comprehensive Earnings Publix Super Markets, Inc. Consolidated Statements of Comprehensive Earnings Years ended December 31, 005, December 25, 2004 and December 27, 2003 2005 2004 (Amounts are in thousands) Net earnings Other comprehensive earnings (losses) Unrealized (loss) gain on investment securities visible(prenominal) for-sale, net of tax effect of ($8,484), $419 and $3,174 in 2005, 2004 and 2003, respectively Reclassification adjustment for net realized gain on investment securities available-for-sale, net of tax effect of ($1,692), ($1,348) and ($800) in 2005, 2004 and 2003, respectively Comprehensive earnings $989,156 819,383 Volume 3, Number 4 2003 660,933 (13,510) 668 5,055 (2,695) $972,951 (2,147) 817,904 (1,274) 664,714REFERENCES 1. 2. 3. Appleson, G. (2006, August 14). Grocery chains blur retailing lines as they store Wal-Mart. K night Ridder Tribune, P. 1 Awbi, A. (2006, June 16 Tesco Shifts Focus as foreign business booms. Food & Drink Europe. com. 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