Loblaw Companies Ltd. – a Strategic Analysis by Emily Tauro

Loblaw Companies LTD. – A Strategic Analysis by Emily Tauro

Introduction:

“Loblaws is facing increased competition, which unfortunately comes from the

number one retailer in the world, Wal-Mart. Wal-Mart has a full grocery offering in their

super-centre which has created a new competitor for the Loblaw Company. In addition,

numerous traditional non-food retailers such as Zellers, Shoppers Drug Marts, and gas

station kiosks, are increasing the food products sold in their stores.”

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This presents a

problem to the Loblaw Company because it now has more competitors and is no longer

the “go-to place” for groceries. In order to remain competitive with Wal-Mart and other

competitors, Loblaw created the Real Canadian Superstore which sells everything from

groceries, to medicine, to clothes to even household appliances/furniture and a womens

fitness area! I believe this was a very good move for Loblaw’s because they remain

competitive by updating their stores’ inventory, which keeps them current with the rising

trend of a one stop shopping store.

Overview of Loblaw/RCSS Current Strategy:

“To reach our Goal we must become a centralized, marketing-led organization

with an unrelenting focus on our customers, our products and our stores. We will

continue to leverage our scale and develop our capacity for consistent execution to drive

a profitable growth. At all of our stores from coast to coast with the support and

enthusiasm of every colleague and franchisee, we will offer a combination of promotions,

products, customer service and value that cannot be found any where else - that is what

will make Loblaw Worth Switching Supermarkets For.”

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The above quote is from Mr. Galen G. Weston (the Executive Chairmen) and

states the goal of Loblaw and how they will execute it. The superstore will focus on

making the shopping experience more enjoyable for the customer by providing a variety

of products and good customer service. They do not plan to change their pricing but

instead make their stores a better environment so customers will think twice about going

to Wal-Mart for their everyday needs. To carry out their goal, Loblaw has created a

strategy with three main themes; simplify, innovate, and grow.

To some, the Superstore is overwhelming because of the large size and array of

products throughout the store. The Superstores in attempt to hold everything much like

competitor Wal-Mart, as well as groceries, have begun to carry a clothing line (Joe Fresh)

which is the leader in child clothing sales,

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an electronics section which contains

everything from battery’s to T.Vs, pharmaceuticals, cosmetics, home appliances/furniture

and even a fitness centre and cooking class room. In a sense, The Real Canadian

Superstore offers a sample of the major stores; Future Shop, Shoppers Drug Mart, Home

Sense, any clothing fashion store, as well as a fitness centre all under one roof! This

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Assignment Handout

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