Publix Builds to Suit

Discussion
Apr 04, 2006
George Anderson

By George Anderson


Publix has thrown out the cookie cutter and is increasingly looking to tailor its store formats and product offerings to meet the needs of consumers.


The South Florida employee-owned chain has continually reinvented itself with new store formats, including free-standing liquor stores, its Latino targeted Sabor format and its upcoming introduction of two Greenwise banner natural food units. The grocer has added organics to its traditional supermarkets, along with items such as designer perfumes and jewelry, in response to market opportunities.


This willingness to adapt has enabled Publix to maintain a 57 percent share of the South Florida grocery market even as Wal-Mart continues to grow at the expense of others, such as Winn-Dixie.


Jim Hertel, senior vice president of Willard Bishop Consulting, told the South Florida Sun-Sentinel, “Food retailing is basically a local phenomenon. The fact that Publix stayed close to their region and stayed close to their shoppers has proved tremendously successful.”


“We never do anything without asking ourselves, ‘How does this benefit the customer?'” said Anne Hendricks, a spokesperson for Publix. “That’s what we concentrate on — keeping our customers happy.” 


Moderator’s Comment: What most impresses you about Publix? The chain is known for catering to the needs of local customers but are there other aspects
of the business where it excels (logistics, information technology, advertising, etc.) that are often overlooked when discussing its business?

George Anderson – Moderator

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12 Comments on "Publix Builds to Suit"


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Karin Miller
Guest
Karin Miller
14 years 10 months ago

I happen to have been in Florida for the last 9 days, and while Publix seems like perfectly fine grocery store, shiny new Wal-Mart Supercenters, with lower prices and the convenience of all of the non-grocery items on-site, are hard to resist.

Ed Dennis
Guest
Ed Dennis
14 years 10 months ago

Duh, forgive me, but is this a surprise? Publix is successful and will remain successful because of its core belief in respecting its customers, employees, suppliers and competitors. This may sound a little funny but Publix treats people as if they have intelligence and avoids at all cost the trickery of many of their competitors. They receive in return the loyalty of their customers, employees and suppliers. By considering others needs they have built one of the strongest consumer franchises in the world. Wouldn’t it be nice if Wharton and Harvard business school spent some time looking at organizations like Publix and Chick-Fil-A. I am sure that retail America would be shocked to find that earning loyalty is not dependent on 4 color ads and coupons.

Art Williams
Guest
Art Williams
14 years 10 months ago

We remember shopping at Publix when we lived in Florida because of the friendliness of their employees and the general atmosphere of the store. They made you feel welcome and that they were glad that you chose to shop there. We contrast that to the moods in most of the stores we have frequented since then and miss Publix. This attitude was evident throughout the organization from their corporate office in Lakeland with the free orange juice to all of their stores. Publix is a very well run and managed chain in my opinion. It is obvious they care about their customers in many ways.

David Livingston
Guest
14 years 10 months ago

Besides the obvious corporate culture stories we read in all the industry media, I am impressed with senior management for not taking huge salaries but rather working on commission through the increase in stock price. Try finding someone at Winn-Dixie, Albertsons, or Safeway who is willing to do that.

Mark Lilien
Guest
14 years 10 months ago

Publix’s performance is proof that it’s possible to be financially driven while also being customer-driven. Earnings per share rose from $2.62 5 years ago to $5.75 in 2005. Dividends rose from 32 cents to 70 cents. The stock price rose from $46.50 to $77.25 from 2004 to 2005. Net profit after taxes was 4.8% of sales in 2005. How many other retailers, let alone supermarket chains, can beat these results? BTW, they lost millions in several hurricanes. They lost millions by dumping their online shopping program, PublixDirect. The financial results include those losses.

W. Frank Dell II
Guest
14 years 10 months ago

Two factors stand-out. First is a real customer focus. They have defined their target customer and work hard to please them. Second is a company culture. The company is a big family focused on satisfying customers.

Camille P. Schuster, PhD.
Guest
14 years 10 months ago

Giving local consumers what they want by individualizing stores, and what is offered in those stores, is a model that can’t copy and still maintain its level of efficiency. The bifurcation of the consumer market appears to be selling at the lowest price with the most efficient system on the one hand and customize stores, offerings, and service to local groups of consumers on the other hand. Publix is certainly positioning itself to continue to be successful.

Gene Hoffman
Guest
Gene Hoffman
14 years 10 months ago

What makes Publix so good? First, they understand change in a vastly diversified environment and go with the contemporary flow in a sincere and effective manner. And second, their corporate culture is geared to the customer and his/her wants and needs, not to top management. Publix is a Good Show.

Stephan Kouzomis
Guest
Stephan Kouzomis
14 years 10 months ago

Being a very avid fan and supporter of everything Publix has and does, it is astounding that such a large supermarket corporation can stay abreast of:
1) what its shoppers want and need; 2) deliver the right fresh foods, in the right store format; 3) continue to emphasize consumer-centric efforts, as well as employee-centric initiatives; and 4) test, spend, analyze, consumer market(ing), and roll out, without the Industry’s concern of spending to learn and improve.

The corporate management has always protected a culture that brings Publix and its employees to the forefront of the industry. All the points mentioned, whether it’s organic foods, Hispanic supermarkets, etc., Publix understands where the next profit arena can be. It is an excellent example in the Industry of utilizing consumer research and marketing the “right way”!

What is next for Publix? Maybe testing a produce, meals and beverage outlet, with a car wash operation to capture the consumers in need of quick, convenient shopping! Hmmmmm.

Bill Bittner
Guest
Bill Bittner
14 years 10 months ago
Since we were always in a non-compete situation, I was able to work closely with IT professionals from Publix in the development of software packages for store replenishment and DSD receiving. It was interesting because the customer focus appeared throughout the discussions. In this case, the customer was their fellow Publix store employees and the emphasis was on getting the best possible solution for them. These technology professionals were aware of the importance of “getting it right” and insisted that the roll-out of new applications be preceded by a thorough QA process and beta testing. Since software projects are notorious for being late or producing results below expectations, extra testing is often seen as an obstacle by the IT department. Not at Publix. Instead, it was seen as an opportunity to ensure the quality of their results. We all know about the “retail face” of Publix which is legendary for its customer focus. My experience with the organization shows it to go much deeper. This is the best example of a “good business model.” The… Read more »
Ken Wyker
Guest
14 years 10 months ago

Publix: Where shopping is a pleasure.

Their slogan doesn’t say anything about prices, quality, or even anything about food. But it says everything about what makes Publix different from its competition. It’s all about the customer experience.

Matt Werhner
Guest
Matt Werhner
14 years 10 months ago

The Publix Sabor format is an wonderful strategic idea put into action. It is a clear representation of the company’s commitment to their customer base. Publix is a working example that people are willing to pay a higher price on goods in exchange for excellent service. Emphasis on excellent.

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