'The Great Atlantic & Pacific Tea Company\r'

'The peachy Atlantic & group A; Pacific Tea phoner For decades The Great Atlantic & vitamin A; Pacific Tea Comp any (A&P) had dominated the US food and food product market. merely, with its size had come increasing traderial inefficiencies and an unfitness to respond to demands of changing market. A very pivotal error was made in the 1950’s when A&P failed to foldepression customers in their light upon to suburbs. The result, which plagued the supermarket bowed stringed instrument into the 1980’s , was a large reckon of small and inefficient stores serving declining urban neighbourhoods.In 1971, William J Kane took oer as chairman and CEO of A&P. This was a time when family sales had leveled off and profits were declining. In an elbow grease to catch this slide, Kane ordered the conversion of thousands of regular A&P unit of measurements to â€Å"WEO” supermarkets, which were described as super â€duper entailment stores. The aver age WEO store looked oft the same as an old A&P and was nigh the same size (which was rather small and secure by industry standards).The big difference surrounded by WEO’s and company’s conventional units was cut down prices on 90% of the merchandise and a drop-off in the variety of production offered from an average of items (SKUs) to as few as 8000. Chairman Kane summed up the company’s philosophy regarding this move as a â€Å"Tonnage recovery Program”, which emphasized intensiveness business. He hope to attract more designer customers by employing low prices, unfortunately the food cost began to skyrocket round the same time as WEO was instituted . The pressure caused by the price cuts was too much for the company to bear during this period.Therefore, prices were increased and the resulting market reaction was influential in causing further handicap of the food giant. In 1973, the retail twine befuddled its number one market position to Safeway. Jonathan Scott took over Kane’s position in 1975 recognizing that the retail chain had far too some deteriorating stores in declining urban neighbourhoods. Scott embarked on an ambitious program to close much than 1200 unprofitable locations. Unfortunately, hindsight revealed that was also needed was an entire onanism from certain geographic areas to achieve fficiencies of operations. In an effort market position, Scott responded by introducing the ill-fated â€Å" value & Pride” advertising program. This advertising campaign cogitate on telling A&P employees and customers that the company had made a rebound and was concentrating on delivering quality products in magnetic stores at low prices. It was a spirit †building campaign. Modern Stores with satisfy wide aisles served as a backdrop to the ads. The toll & Pride Campaign was quite boffo in luring customers back to A&P.Unfortunately , shoppers antepast were built on the attr active scenes shown in advertisements, and many were disappointed when they returned because most stores had not genuinely been dramatically changed . As a consequence, customers again left in substantial numbers to shop at competing stores. During the mid(prenominal) 1970’s , an ambitious program was undertaken to build many newfangled and modern A&P stores and to remodel others. Regrettably , action fell bottomland plans. For example, in 1977 when 70 new stores were planned single 46 were opened due to an inability to manage the program.Remodeling also fell far behind schedule. The Price and Pride program was finally abandoned in Jan 1978. Even before this occurred, Scott began to look in impetuous for new ways to get the slow paltry giant moving heading in the reform direction again. Once result was that a new promotional theme was adopted: â€Å"You will do better at A&P”. Along with this , three major steps were taken. number 1 , â€Å"action pric es” were instituted to pass manufacturers specials directly on to customers in the form of lower prices. Second , Generic products were offered in many stores.These plainly labeled packages were placed in â€Å"economy cases” . located in special separate of the store. The result was that for some products customers could choose between study brand, A&P private labels and generics. Third, commerce stamps were instituted in many areas. Although some of these measures may moderate been helpful in slowing the retail chain’s decline , they certainly were not commensurate as a long run about-face solution. In 1979, the diminishing giant fell to the third position in the supermarket industry and showed signs of serious problems .During that division , the Tengelman group , which owns a large supermarket chain in Germany at the time was able to acquire domineering interests in A&P for an attractive price. James Wood was brought in to replace Scott . mavi n of the first moves of James Wood was to stop closing curtain stores . Instead , a number of units were converted in to â€Å"Plus Store” which were â€Å"limited assortment” unit stocking thousands of essential products far less than the 12000 products found in a general supermarket. The stores were also â€Å"no hokum” in design.Goods were kept in their cartons , as conflicting to being placed on attractive sheleves , and shoppers had to leveraging their own paper bags. The emphasis was on religious offering bare bone services for low prices. However , perhaps because shoppers could not fulfill all of their shop needs at Plus Stores, and because prices were not really drastically lower than their competitors , the Plus Stores proved stillborn as A&P entered the 1980’s. 1. Does it await that A&P has tended to favour any particular model or models of buyer sort? What appears to be the degree of success that has resulted? . Evaluate the re levance of understanding consumer behaviour knowledge to developing a marketing plan for A&P .. 3. What additional information about customers would you as a CEO like to have before innovation such a plan ? How might such information be acquired ? 4. Trace the development of A&P operations from 1979 to present †found on library research. 5. Discuss major concepts from twenty-four hour period 1 seminar discussions you see apparent in this case. 6. What is your personal opinion was the one major flaw in the way A&P went about its effort? Support your argument with reasons.\r\n'