Let a Professional Writer Help You, © New York Essays 2020. By having a closer look over the matrices used for financial analysis, it is to say that the financial statements holds notable importance because it evaluates the management performance, plans and corporate strategy for future. As a result, companies shed employees in order to become more cost competitive. With the media not present in buyer and supplier transactions, competition is clueless in their decision making because they have no idea what Trader Joe’s is doing or what products they’re about to release. If Trader Joe’s were to follow this strategy, then they will see a huge increase in overall business and customer satisfaction. The problem statement refer to the concise description of the issues that needs to be addressed. calculate the key ratios that you can with the given data and provide a table – see HBS note titled “Financial Statements and Ratio Analysis”). The customers enjoy the wait because they are thrilled to see what new products Trader Joe’s will release. These technological breakthroughs have resulted in faster wait time in lines and also less crowded lines as well. 4% increase in same stores sales growth, as of 2012. Scope of Competitive Rivalry: Supermarkets traditionally operated on very thin profit margins. Trader Joe's HBS Case Analysis 12.2016 1. In case of high equity turnover ratio, indicating that the shareholders have efficiently used equity. Legal and Regulatory Factors: Wage legislation has affected the supermarket industry by employees unsatisfied with the amount of pay they receive for the amount they work. The matric can be adjusted for thepurpose of reflecting the average equity amount being employed during the span of year, giving the more accurate and realisticpicture of how the organizationhas been performing throughout the year. SWOT and PESTLE analysis is a powerful tool to analyze all the factors including external and internal things to decide on the problems that can impact the organization. They are the Trader Joes technical and economically ways through which the project can be carried out feasibly. The seven core values are: integrity; product driven company; create WOM customer experience everyday; no bureaucracy; national chain of neighborhood grocery stores; KAIZEN! As it can be difficult to group the companies having similar business lines and to call it an industry. Dollar General stores offer 10,000 SKUs and operate in a 7,200 square feet of selling space. Trader Joe’s announced that 1,250 of its 53,000 employees tested positive for COVID-19 within the past eight months, an infection rate of about 2.4%, according to the grocery store chain. This customer shopping satisfaction has created strong customer loyalty. Also, it offers the benchmark to match the desired condition of the organization, hence putting the efforts of the team in the right direction. This will cause an increase towards the unemployment rate, which could potentially affect companies having to cut costs. As these aspects negatively affect the overall performance of the organization by making it weaker compared to its competitors. This will allow the team to develop a better solution plan addressing all the factors and considering all the risk associated with it. Two Los Angeles police officers will not face criminal charges in the 2018 shootout at a Trader Joe's store that injured the armed suspect the officers were pursuing, and resulted in the death of the store's assistant manager. In addition to this, the careful and deep consideration is given to the political, economic, social and other porter 5 forces and pestel model so to understand the alignment of right alternative with maximum value and weightage in resolving the problem. The company offers its branded products to highly educated and low income generating target market, at lower prices as compared to its customers. Alternative are the different ways of achieving a same end goal through two or more different methods. After considering the major top problems, the business analysts or managers would then be able maximizing the shareholder’s wealth. From the standpoint of owners, the key value drivers may be the growth potential company’s key services and products, key technology capabilities providing the competitive edge, superior process’s cost effectiveness as well as the strategic differentiated positioning. Due to the strategic framing of these statements, Trader Joes has remained at the helm of its performance ever since its foundation in 1958 by Joe Coulombe. The options developed entails and includes the maximum factor that the organization should analyze or achieve, thus offering great value. PESTLE analysis is one the significant and widely used tool or framework mostly by organizationswith the intent of considering the market environment before commencing the process of marketing. This allows the stakeholder to understand and determine the time and resources required to implement the plan effectively (Turner, 2012). It is encouraged to be consider especially for a projects that are large and complex in nature. It is a factor that contribute positively towards the growth of the organization. Another weakness is that Trader Joe’s has a very limited product selection. PESTLE Trader JoeS analysis provides you with a summary of the entire situation your company may be in. It is a strategic planning framework that is commonly used to evaluate the organization, a plan, business or any other project. If farmers are unable to farm crops or other resources that companies in the industry rely on, then the companies in the supermarket industry will face a reduction in sales. A strong Trader Joes recommendation must cover the key areas as how the organization will implement the alternatives, what benefits will it receive if it implement the when alternatives and what could be the cost, that he organization will need to overcome or address, in order to effectively implement the alternatives. The Trader Joes VRIO analysis is basically the extension of the Trader Joes PESTEL analysis, which allows the oragnation to understand the resources, competitive edge, value proposition and its value in the market. Trader Joe’s currently does not have an official social media, yet fans are creating fan-based accounts. It is a condition existing in the external environment that allow the organization to take an advantage of the organizational strengths, and help in overcoming the weaknesses and to neutralize the threats present in the environment. Trader Joes Weakness refer to the situation in which the existing capabilities and the resources the company holds are weaker or not sufficient compared to others organizations in the market. It is effectively used in building strategies for the organization to maintain its competitiveness in the market. Trader Joe’s and its suppliers keep their business with each other a secret. Trader Joe’s generic strategy is focused on differentiated products for a differentiated target market at low prices. Whole Foods, a premium company in the industry, offer products that meet the needs of this new healthy trend. All in all, the advantage of using the VRIO analysis is to determine the sustained competitive edge in the market. There are many occasions, in which the environmental changes have an adverse influence on the project that might not be noted in the initial stages of project, indicating that the uncertainty sis still there even after the pestle analysis have carried out. These break-through findings have reflected how consumers are waiting less in long lines. The feelings are usually positive feelings but negative feelings are quite common. hence ins uh cases, the direct problem is no the ultimate organization factors but the process implementation that is needed to e in lace, in order to bring change , avoiding the upcoming risk and hence sustaining the competitive edge in the market (Spradlin, 2012). Such type of calculation needs very selective estimate or analysis of the variables and fixed cost or expenses of the company while taking into consideration the operating leverage effect. Trader Joe’s Midterm Case Analysis Jean Carlo Hoyos Trader Joe’s Analysis Hoyos 2 The Industry The grocery industry in the United States is currently an attractive industry (a.k.a. By doing so, Trader Joe’s is able to save money because they are buying new products in bulk. Competitive strategies … 2 Grocery shopping is more diversified and evolved than ever before. It is the process that is widely used for identifying the financial weaknesses and strengths of the corporations, this can be done by building the relationship between items of the profit & loss account and balance sheet. The difference in products and prices is the reason for the grocery store gap. Trader Joe’s is sitting in a good position because everyone nowadays has above par skills with social media. In addition some analysts had begun to question whether Trader's Joe's was losing its authenticity and "quirky cool" as the firm had continued to grow and expand across the country. It is not a close substitute of a first define choice or other alternatives or must provide the solution of the problem in a particular way. These in-imitable factors allows the organization to developed the sustained competitive edge in the market and hence enhances the chances of sustainability ion the long-term. Apart from this the size and the reputation of the companies that are already operating in the market also play an important. for the purpose of answering these type of question, it is important for organization recasting the financial statement in to the percentage terms. Hire a Professional to Get Your 100% Plagiarism Free Paper. It is amazing how technology has improved shopping experiences for customers. The consideration of cost is important in the alternative generation in order to attain the maximum feasibility with overall business strategy and the budget allocated. Threats are the factors that prevent the organization from the actualization of an activity. By not keeping a close relationship, suppliers can take their products to other companies and the suppliers can charge a higher price. Trader Joe’s does this so the customers and the industry are surprised with what products they are offering in their stores. For secrecy between Trader Joe’s and suppliers to stay strong, I recommend that Trader Joe’s and its suppliers keep a close relationship. High threat of substitute leads to low profitability as it limits the industry profits by placing a price ceiling due to the fear of being substituted by other product. The particular section deals with the different ways the problem can be resolved. As a framework, SWOT does processes a value but it doesn’t provide the organization with any specific direction on how the key aspects can be identified. The conciseness of the problem statement is the key, as it allows the reader to quickly understand the issue. Apart from this, while developing the problem statement, it is important for the Problem statement to be clear and concise. Cost of goods sold and gross margin analysis: in operational analysis the most commonly used ratios involves the calculation of the cost of sales as a percentage of sales. It is a strategic tool that is used to avoid or minimize the risk of losing the competitive edge that the organization has and to ensure the profitability of the products in the long run. The culture or social influence on certain businesses vary from country to country. Customers at Trader Joe’s are very loyal to the brand. Trader Joe’s three biggest advantages are its customer loyalty, customer service, and everyday low prices. It is a useful tool that is widely used for strategic planning and management in many organizations. The credit policy of an organization last greater impact on the day’s receivables. The internal environment of an organization includes internal customers or staff, wages, office technology and finance etc. Return on equity (ROE): This performance measuring parameter measures the return that the company has earned in relation on the owner funds. Theratios are sub-divided into the major groups that tend to cover the financial areas. In fact, the analysis of the environment needs to feed all planning aspects as well as it should be continuous. It is due to the fact that the organization needs to analyze exact factor in terms of its reversibility to see, if the process can be reversed, if the option fails to offer the respective results. All in all, the recommendation include, what, why, how and whom factors. These two different types of stores offer various products at various prices. It is most important ratio in companies which are capital intensive. Trader Joe’s has experienced customers being unhappy with how long the wait lines are. SWOT analysis mainly have two dimensions internal and external dimensions. Competition from Potential New Entrants to the Industry (Moderate): Competition from potential new entrants to the industry is moderate. In Addition it is also needed to be considered, if the given option or the alternatives have the right alignment with the organization and re offering value. Strength is a characteristic that adds value to something by making it more special, unique and advantageous when compared. It is most common use with the objective of assessing the business model and financial health of company through revealing the remaining portion of money from revenues after deducting cost of goods sold. This is important, as it allows the reader and stakeholders to understand the proven facts, and the pasts results such recommendation has harvested, leading to more acceptability and also the determination of the plan that may be in need to be adopted so to avoid the delays and resistance in the organization, while implementing the change. This in turn might defeating the prime reason of the pestle analysis. Hence, it is suggested, that while developing the alternatives, it is important to consider the realistic and smart nature of options along with the avoidance of developing such issues that are not offering the right solution or the suggesting such options that are of no use to the organization. Appendix E: Current Strategy Trader Joe’s has expanded relatively close to 400 stores nationwide in 37 different states. Joe Coulombe, the founder of this grocery chain, in 1958 acquired a small chain around the LA area under the name of "Pronto Markets," the idea of Quick and fast markets. Trader Joe’s and their suppliers agree on a mutual secrecy to keep the media out of their business but also to keep customers and competition anticipating Trader Joe’s next move. Analysis From ATTOM Reveals Fresh Take on Grocery Stores Impacting the U.S. Housing Market Trader Joe's leads the pack for homebuyers, while … The recommendation is mad in away, that not only offers the solution the problem, but also depicts the implementation process and the course of action that the organization needs to take in order to be successful. Once it is done, each alternate is compared against each other and with the decision criteria develop, and are given different weigtage. 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