Retail Management

Retail Management Assignment

Question 2

There are currently two types of trends currently affecting Mega, our chosen store. We shall break these into two sections, macro and micro trends and discuss the effect they have on the store and the SPAR group as a whole if applicable.

Macro Trends

These are the trends that are outside of Mega SPAR’s control but they do affect the store’s operations and profit making ability.

(a) Demographic factors – The store is near a taxi rank, people from diverse age, ethnicity, education level, house hold lifestyle, cultural characteristics and movement pass through the rank. The store has a challenge of being able to cater for their needs, partially at least so it is able to gain a portion of their market

(a) Economic

An example of political unrest being the rand performing worse when the minister of finance was changed few times during a short space of time, and investors losing confidence in south Africa as a country of safe, viable and profitable investment entity

(d) Technological – Automated tilling systems, tap and go debit and credit card facilities are talking over. Due to social media and other trends, customers want to be able to shop easily using these kids of methods to simply their shopping experience.

(e) Legal factors – The POPI act affect the way Mega can communicate with our customers, such as the use of information we gather through the loyalty cards and SPAR reward databases.

(f) Social – Customers now have social media to voice their pleasure or displeasure of shopping at Mega. They can check other people’s opinions or experience that they received at the store. From their trusted friends, these become like word of mouth and affects the reputation of our store.

Micro

Worse off, it is next to a very busy taxi rank. It is very difficult to park with the taxi busses passing as the reversing from the parking gets you into the busy street.

• Poor signage and boards

- It is very difficult to find store if you are going there for the first time. There is no signage that guides as to where the store is. The SPAR signage on the building itself is not very visible as it is at the very top and it’s a very busy street to try drive slowly to look for signs. No land marks around to easily identify the location. The other SPAR which is less than 2 kilometres away, Midrand SPAR has SPAR signage and flags to guide people where it is.

• Our competitors sell similar products to ours

- Competing stores, Pick ‘n Pay, Shoprite, Checkers sell similar products, in the same LSM . Checkers is better on pricing, and considering the market we serve, people are more likely to walk two kilometres away for better pricing as products offerings are the same.

• Customer purchase in small baskets

- The average basket size of the store is very small. Although there is lots of feed to the store, their basket spend is relatively small. This is worrying as this is the loyal and frequent customers who come to purchase throughout the day.

• Sensory detectors (entrance/exit