By Barry R. Berman
This booklet brings jointly strong new thoughts that world-class shops are utilizing this day to thrive in a brutal enterprise setting. most sensible retail professional Dr. Barry Berman exhibits how one can plan, execute, and win in response to fee and differentiation. special case stories contain Wegman’s, relations greenback, objective, Tesco, Walgreen, and Costco.
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Extra resources for Competing in Tough Times: Business Lessons from L.L.Bean, Trader Joe's, Costco, and Other World-Class Retailers
This unbundling strategy satisfies the needs of both the low-cost segment (which is willing to do some or all of the services) and full-service customer segments (which are looking to do none of these tasks). Unbundled pricing also enables a retailer to match the price of low-cost retailers that do not provide ancillary services. It also charges customers for only those services that they desire. A retailer needs to be careful in formulating its differentiation strategy so that its new strategy is not based upon a niche.
Retailers owned by private equity firms that were purchased during prior boom years due to their strong cash flow and property assets are also suspect. The overall effects of the economic downturn have been felt around the world. A major global credit insurer, Euler Hermes, estimates that about 35,000 Western European retail businesses became insolvent in 2009, up 17 percent from 2008. 35 Among the major recent European retailer bankruptcies were Woolworths, a British chain selling toys and housewares; MFI, a British furniture retailer; The Pier, a housewares chain; and Arcandor, a German retailer whose Karstadt department stores anchor downtown shopping areas throughout Germany.
Shoppers may come from greater distances, rely less on advertising, and seek out retail sales personnel that are especially knowledgeable in a given product category. A very high concentration of customers in a given market area may also result in a retailer’s better understanding its customer base. Finally, a high market share can also be a strong deterrent to new competitors entering the market area (due to a poorer understanding of the target market’s specialized needs or less competency in delivering the specialized services).