CHICAGO -- In today's world of infinite consumer choices, a strategic plan is an integral part of any successful business -- especially supermarkets.
And not only does such a plan protect the business from encroachment by competitors, it can help fuel the future success of any company.
Panelists at a seminar on organizing and executing a strategic business plan addressed this subject at the recent Food Marketing Institute convention here.
According to David Sterry, director of Swander Pace & Co., a strategy consulting firm in San Francisco, it is impossible for a store to have a strong presence or success rate without a sound strategy.
The foundation of the business must be based on several key questions, he said. Retailers need to ask themselves what customers and purchase occasions they wish to target; what key points differentiate them from the competition and make their store the best choice for the customer; and what resources and activities will be required to carry out their plan.
"Strategy is all about resource allocation," he said. "Retailers need to objectively evaluate their situation, plan for the future, and then utilize their resources to take action on those plans."
In creating such a blueprint, he added, it is vitally important to recognize that the changing face of the customer requires changes at store level.
To illustrate his point, Sterry noted a dramatic increase in the number of shorter, smaller trips to the supermarket -- customers stopping in quickly on their way home from work to pick up something only for dinner, for example. He said these customers often find it difficult to check out quickly because they must stand in line with customers doing their weekly shopping.
"Most stores are built to serve large shopping trips," he said. "But the needs of the shopper making a quick trip must be addressed as well because you want that customer to return to your store for their larger weekly orders."
One solution to this dilemma may be to create a special section and checkout area dedicated to the quick-trip customer, he said. The department could carry the items most typically purchased during these hurried visits, such as meal components, milk and bread.
With this in mind, Sterry urged retailers to research their customers' shopping habits to determine what brings them to one store for some items and sends them to another for something else.
"Take a good look at your customers and their needs and use that information to your advantage when you create your plan," he said. "Make your store the shopper's only grocery destination."
Following the presentation, Sterry was joined by Craig Cole, president and chief executive officer of Brown & Cole Inc., Bellingham, Wash. Cole fielded questions from the audience regarding how strategic planning has helped his company to flourish and how the planning process can work for them.
Brown & Cole -- a 24-unit division of Seattle-based Associated Grocers Inc. -- has experienced significant growth during the last decade, according to Cole. He credits that growth to effective strategic planning, which he describes as the rational determination of what the business ought to become and how and when it will get there.
"Strategic planning is a way of evaluating where you are now, deciding where you want to go and implementing a plan to get you there," he said.
He added that implementing a guidance plan has helped his company to become more focused and disciplined. Some of the results, he said, have been increased profits and significant growth.
Having goals clearly outlined has also been very helpful in communicating the mission to employees.
"Every company needs to establish a practical and realistic strategic plan that builds on their experience and expertise," he said. "Just be sure it's within your capabilities to execute and manage your plan."
"Narrow your strategy to a few basic objectives because trying to do too much is almost as bad as not doing anything at all," added Sterry. "And remember, it's not so much what strategy planning method you use, but the fact that you have a plan."