...SmartMart Simulation February 4, 2015 SmartMart Simulation 1. Set out your overall strategy for SmartMart, explaining why you elected to follow this strategy, and how each decision you made contributed to this strategy. Scenario 1: Grow to Compete with Big-Box Mart: 50% of growth in the consumption of organics is driven by the offering of organics at low-cost producers, like Big-Box Mart. Hence, it is essential to compete in this space.The costs of implementing this aggressive growth strategy is significant and there is also a higher payoff. Store revenues are expected to jump from $3M annually to $30M. If SmartMart could retain its distinctive advantage, this strategy would be most profitable because margins would be slightly lower, but volume would increase almost 10 fold. There would a net lower environmental impact as there are efficiencies produced by centralizing the use of trucks and transportation. Moreover, giving the option of a one stop shop to customers would give the benefit of increased sales to SmartMart. Scenario 2: Introducing Bio-fuels: SmartMart has worked with leading researchers and scientists to find the optimal blend of bio-fuels and gasoline. This improved blend of fuel increases an average car's miles per gallon (MPG) by as much as 20%. By offering this innovation at select SmartMart stores, the company stands to gain from the increased revenues of fuel sales, as well as the increase in brand perception. SmartMart should move...
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...My strategy for SmartMart is to be a niche store and customize themselves to the local conditions. They should be a one stop shop for all the organic products and offer its customers a wide selection. SmartMart should continue with its exceptional customer service and should leverage its brand value to fight the competition from the existing niche store and new entrants. Introducing SmartMart's biofuel and exclusive Organic 2.0 label will help SmartMart differentiate itself in the market and have an edge over other organic retail chains. Securing an Organic 2.0 label from the FDA and government agencies will further add to the credibility of organic products one gets at SmartMart. This will also get SmartMart support from not only its existing customers but also from community members like environmentalist. SmartMart is a successful retail grocery store which focuses primarily on organic, healthy and environment friendly line of products. Its major customers are high end affluent people who seek rich customer service and price is a secondary concern for them. One of its major strength is brand loyalty. Its mission is to create a sustainable future by providing value for all its stakeholders and customers while contributing towards a greener environment and having a strong financial return. With the changing market trends, SmartMart anticipates a need to reassess its existing business model to succeed and maintain its competitive edge in the coming years. In scenario one, I suggest...
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...My strategy for SmartMart is to be a niche store and customize themselves to the local conditions. They should be a one stop shop for all the organic products and offer its customers a wide selection. SmartMart should continue with its exceptional customer service and should leverage its brand value to fight the competition from the existing niche store and new entrants. Introducing SmartMart's biofuel and exclusive Organic 2.0 label will help SmartMart differentiate itself in the market and have an edge over other organic retail chains. Securing an Organic 2.0 label from the FDA and government agencies will further add to the credibility of organic products one gets at SmartMart. This will also get SmartMart support from not only its existing customers but also from community members like environmentalist. SmartMart is a successful retail grocery store which focuses primarily on organic, healthy and environment friendly line of products. Its major customers are high end affluent people who seek rich customer service and price is a secondary concern for them. One of its major strength is brand loyalty. Its mission is to create a sustainable future by providing value for all its stakeholders and customers while contributing towards a greener environment and having a strong financial return. With the changing market trends, SmartMart anticipates a need to reassess its existing business model to succeed and maintain its competitive edge in the coming years. In scenario one, I suggest...
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...at 20% a year. SmartMart has been a dominant player in the organics market since the 1970s, and has benefited from the mainstream acceptance of the organic label. The label and standards adopted by the USDA and the FDA at the turn of the century, currently prevents foods containing additives, artificial and chemical processing, and genetic modification from using the label organic. The use of the label has allowed many suppliers and farmers to adopt organic practices (to varying degrees) and thus organics are now also available from many of SmartMart's low-cost competitors. For example, customers who used to buy meticulously cultivated blueberries from SmartMart can now purchase four times as many "organic" blueberries from Big-Box Mart for the same price. Other product lines are not immune to the disturbing trend and we are seeing the first signs of reduced profitability and decreasing projected growth in the organics segment for SmartMart. Researchers and scientists who work at SmartMart have created a new standard in organic practices which seeks to push the envelope on sustainable practices. Organics 2.0 is a new concept which surpasses the old standard in several ways: 1. In addition to additives and artificial processing, Organics 2.0 takes into account a product's carbon footprint. Currently there are organics being cultivated which actually increase CO2 emission. This new standard would print a Carbon Footprint number (based on a SmartMart Patented system)...
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