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Central Market Q4

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Submitted By Tuanduong
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At Central Market, “about two-third of the store’s floor space is stocked with perishables” (Pineault, 2011, p.53). According to Kevin Coupe, executive editor of Progressive Grocer trade magazine in Stamford, Connecticut: “The more sales you can move to perishable, the better, because the amount you can charge for Coke, Pepsi, or Tide is tight”. We could see that most of Central Market’s profit comes from its fresh food, fruits and vegetables. Therefore, the food safety has become the main challenge for Central Market.
In order to guarantee its goods freshness, Central Market has managed its prep facilities like a factory. “At Central Market at least 20 percent of the store’s sales come from its roomy produce section, which eats up almost a third of the store’s 60,000 square feet of sales space. The section, kept at 65 degrees, stocks on any given day as many as 450 kinds of fruits and vegetables” (Pineault, 2011, p.53). Central Market not only sell vegetables and fruits, it also has the section for fresh meat, fish, others. “Seventy-five feet of refrigerator space display fresh fish, while 68-foot meat counter sells more than 100 types of meat, game, and poultry. The cheese department offers 600 varieties” (Pineault, 2011, p.53). Central Market is well aware about the store’s structure to keep its goods in good condition. With over 66% of the store’s floor space is stocked with perishables, the freshness of the products has become the number 1 concern of Central Market, and the products which have failed the company’s freshness guidelines will be taken away by a truck to local food bank each day.
Central Market has well manages its prep facilities like a factory in order to keep its high quality of goods which will increase the sales, and bring profit to the company. “Although the market risks losing money of too many of its meats and fruits aren’t sold quickly, those items have higher profit margins than dry groceries. The margins for perishables are larger because those items are priced higher to make up for losses, refrigeration costs, and the increased labor expenses that result from product displays” (Pineault, 2011, p.53).

Reference:
Pineault, G. (2011). Operations management. New York: McGraw-Hill

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