Environmental Scan Paper
Kenneth Anderson
MGT / 498
November 10, 2014
Rodney Greene

Abstract
In business, it is important to gauge internal business with external business. This process will provide an advantage for shaping the future of business. For that reason, the procedure of creating strategies will help by conducting environmental scans.
Environmental Scan
Designing and building on core values is a required strategy when an organization wants to keep a competitive edge over the competition. There are numerous strategies to pick from in business; a significant strategy is keeping an eye on needed changes and financial trail of record keeping. Furthermore, it is necessary for organizations to keep an outlook on what external sources are doing. It is imperative when acquiring information that defines what other organizations are doing to be conducted in an ethical matter.
Committing unethical deception will cause organizational anarchy. The reason long surviving companies like Smart and Final last; is by removing possible dangers so change for the better will be obvious. Ultimately, legacies are built, and the organization’s reputation utilizes power and self-reliance. A thorough global analysis assessment must be completed during an environmental scanning of any organization. This assessment includes businesses, clients, markets, and industries in the same industry.
The objective of this paper is to examine the organization and conduct an environmental scan, which will define their competitive advantages and operating strategies. Environmental scanning is the monitoring, evaluating, and disseminating of information from the external and internal environments to key people within the corporation (Wheelen & Hunger, 2010, pg. 16). Let’s begin by a comparing Smart and Final’s values versus Costco values. Smart and Final has developed the First Street brand.
The First Street brand expectations are to be equal or better than the competition. Costco has developed the Kirkland brand. The Kirkland brand expectation to be equal or better than the competition. A constant product development must be conducted to maximize challenging goals. Product and price evaluations are constantly reviewed by both Smart and Final and Costco internal research team. While Smart and Final’s and Costco are in a close race with customer service, there is a variation when conducting research that goes into product opportunities.
Let’s break down each company individually, first there is Smart and Final, who has been in the business for over 140 years and were a registered trademark. The product Smart and Final sell caters to the small business, clubs, family, and organizations need on a daily basis which carry over a thousand of items in smaller, convenient sizes. “Smart & Final is the convenient warehouse grocery store committed to offering superior service, exceptional value and quality products to households, business and community groups"(Smart and Final History, 2014, para.3).
So whether you are shopping for your business or home, Smart and Final is well known among the business and large families sectors as “the smaller faster warehouse store”. So why is the organization so valuable to the business sector, because the brand is a part of Los Angeles history in the sense that it survived by offering better customer service and the “cash-and-carry” concept. Smart & Final rightly figured the chain could reduce overhead by introducing self-service but still retain high-quality selection and service (Smart and Final History, 2014, para.1).
Another improvement was building or finding property near client’s businesses, identifying the important of their time and freeing them the trip to an out-of-the-way warehouse. The niche that the company established is providing product and services to small business providing them with finding the necessary product when needed at lower prices. Smart and Final maintains it place in the market by flooding the market through advertising, catchy phrases, and word of mouth. While these strategies may appear very simple for a service that was created for community purposes by partners Herman Hellman and Jacob Haas.
Environmentally Smart and Final had faced confrontations when they received bad media about their stores in Florida and Colorado. These external factors present problems for the wholesale grocer in these states. Florida and Colorado residents not use to the concept of “cash-and-carry” so they did not buy into any of the services the company was providing. Another environmental factor that had an effect on Smart and Final is opening stores in Mexico.
The United States did not agree with this strategy and felt that the company would be conducting unethical behaviors with the drug cartels. The organization had to conduct an environmental scanning to see if doing business with Mexico would be the right choice.
Costco is a membership warehouse club, dedicated to bringing their members the best possible prices on quality brand-name merchandise. With hundreds of locations worldwide, Costco provides a wide selection of merchandise, plus the convenience of specialty departments and exclusive member services all designed to make shopping experience a pleasurable one ("Costco”, 2014,para. 1).
Costco designed their warehouses to help small-to-medium-sized businesses in reducing cost in purchasing for resale and use for everyday business. Individual customers can also become a member and purchase product for personal use. Costco has the most exclusive product selections found every warehouse. These selections include appliances, groceries, television and media, candy, automotive supplies, hardware, tires, sporting goods, toys, watches, jewelry, books, cameras, furniture housewares, clothes, tobacco, health and beauty aids, office supplies and equipment.
The company opened its first location in 1976 in a converted airplane hangar in San Diego, Ca. It serviced only the small businesses but found out it could profit from also servicing the non-business members. With this new change, Costco warehouse club industry was up and running. The company opened its second warehouse in Seattle, WA. Costco became the first company to grow from zero to $3 billion dollars in sales in less than six years (Costco, 2014, para. 1). Costco operating philosophy was simple, keep cost down and pass the savings to the members.
With their large membership and incredible buying power, combined with efficiency, the results were better pricing for the customers. By 1997, Costco grew worldwide with total sales exceeding $64 billion dollars. Costco chooses to target small-to-medium business audience by offering several memberships. Smart and Final choose to target the small business and family sector without membership.
Costco reinvention and business strategy helped the company stay very competitive warehouse club market. Costco like any modern business has a mission and vision for the company and according to "Costco Mission Statement"(2014), "Costco's mission is to provide our members continually with quality goods and services at the lowest possible prices. In order to achieve our mission we will conduct our business with the following Code of Ethics in mind:
• Obey the law
• Take care of our members
• Take care of our employees
• Respect our vendors
If we do these four things throughout our organization, then we will realize our ultimate goal, which is to reward our shareholders” (para. 1).
Perseverance can be learned from these two companies in the business of marketing. If the organization has a product that they believe in, then the strategies in marketing along with the commitment will give the product a long life just like the two organizations have shared for over one hundred years. The difference with these two organizations lasting longer than their competitors in the warehouse grocery industry is they both have products that the public wants, so they adjust their products to suit a specific customer.
Along with the good marketing strategy and surviving negative external factors of competition and listening their customer request which is a very important strategy of them all, but without the clients these organizations would have not survived and become an important part of every community.

References
Wheelen, T. L., & Hunger, J.D. (2010). Concepts in Strategic Management and Business Policy 12e Entire eBook (12th ed.). Retrieved from The University of Phoenix eBook Collection database.
Smart and Final History. (2014). Retrieved from http://www.smartandfinal.com/AboutUs/History.aspx
Costco. (2014). Retrieved from http://www.costco.com/
Costco Mission Statement. (2014). Retrieved from http://retailindustry.about.com/od/retailbestpractices/ig/Company-Mission- Statements/Costco-Stores-Mission-Statement.htm