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Superior Supermarkets

Please read the case study "Superior Supermarkets, Everyday Low Pricing"

1. Describe Superior Supermarket's competitive interaction in Centralia.
2. What pricing considerations should be considered by Superior Supermarket?
3. How might Everyday Low Pricing (EDLP) affect Superior Supermarket's competitive situation in
Centralia?
4. What are the pros and cons of an EDLP strategy for Superior?
5. How does EDLP impact Superior Supermarket's price elasticity?
6. What action(s) would you propose for Superior Supermarkets?

Solution Preview

1. Describe Superior Supermarket's competitive interaction in Centralia.
Superior Supermarket is one of four main grocery stores in the Centralia area however, all three of the Superior Supermarkets are smaller than the three competitors; Grand American, Harrison's, and Missouri Mart. The three competitors draw customers from outside of the Centralia area so they experience more traffic and sales than Superior Supermarket. Superior also is older than the other three stores however it offers more specialized products (though fewer of them) than the competitors. The three locations of Superior are spread out throughout Centralia offering multiple options for consumers. Finally, Superior has the highest priced products but does advertise deeply discounted products on certain items and "loss leaders" such as eggs, soft drinks, bread and flour which are always offered at a discounted rate.

2. What pricing considerations should be considered by Superior Supermarket?

The price considerations that should be made by Superior are those that will offer standardized lower costs on not only popular items but most items within the stores. It would appear that the three competitors do engage in EDLP and are able to continue to meet and exceed their sales margins. With the limited offerings of products within the Superior Supermarkets and the ...

Solution Summary

A discussion regarding Superior Supermarkets, a case study company, including pricing considerations, Everyday Low Pricing, and price elasticity. 873 words.

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