The company follows an interaction model for their organizational structure. The company has a chief executive who looks after the entire operation of the company followed by coordinators in all the departments who are at the top level. The administrative directors, human resource manager, chief operator and the chief officer related to finance control all the operations at the middle level of the organization, which is followed by general managers at each of the departments. The lower level employees of the company consist of team members and the managers of the factories (Paula, 2014). Since the company uses this model, the flow of information is restricted to the superiors of each level. For example, the employees cannot directly share their concern with the chief executive officer of the company directly. It has to pass through a number of people in between before it reaches the ears of the top management. The various departments in the company consist of admin and HR department, finance department, operations department and consultation department. The organization is centralized where the staffs has to report online in the head office. The head office looks after all the informations and the necessary changes that need to be passed down to the various stores in the company (Nanayakkara et al., 2013).
The name Pak n Save has originated because of the practices they undertake with respect to the cost-saving tactics where the customers can pack the groceries in cardboard boxes. The company provides the cardboard boxes so that the products can be shipped to the store or to the supermarkets. Plastic bags are also available, which can be purchased for 10 cents from the North Island stores. The cost of plastic bags is 5 cents for the customers in South Island stores. The customers are encouraged to buy plastic bags that will last longer or they can carry their own bags while coming to store to purchase products (Isberg & Pitta, 2013).
The stores are located on the aisles of the supermarkets with practically no design to attract the customers. The products that are extra in the stores are not displayed on the shelves instead; they are kept on the top of the shelves in the pallets in which the products arrived in the shop. In this way, the floor space can be increased, which helps in the retail purpose. The products that are delivered to the stores come from the Foodstuffs distributor who has been a long-time supplier to the company (Milner, 2013).
The stores of the company buy goods in excess, which means that the stores do not offer different varieties of goods to the customers. Thus, the choice of customers is very limited and has to be within the range of goods that are offered by the company. Some of the stores have the self-scanning system where the customers do not have to wait in line with the trolleys. Thus helps in reducing the time of checkout making the workplace very efficient (Day, Pearce & Pearson, 2015).
Policies and Procedures
The company collects personal information from the customers on a regular basis, which enables the company to provide better services by sorting out the grievances of the customers. The company collects the personal information from the customers as it helps the company to provide an appropriate username and password to the customer to avail the website of the company. It helps the company to provide further assistance to the customers through the website. It informs the customers about the competitions and the promotions that will take place in the stores of the company on a regular basis, which will help in retaining the customer base. The company also provides additional information to its customers about the products and the services so that it helps in raising the interests of the customers (QC & Smith, 2015).
The company ensures that the personal information of the customers will not be disclosed to any other organization except when it will be an absolute necessity. The information can be disclosed with prior permission of the customer to the Foodstuffs North Island and South Island Limited who are the major suppliers of the company. They can disclose the information to the third parties if they find that the parties are in good faith and has been instructed by the law. The company will take permission from the customers by either sending them a mail or a text requesting their actions and interests. If the customer does not want the information to be shared then the customer needs to either reply to the mail or send a text to the company informing them about the same (Carter et al., 2013).
The company ensures that every endeavor that it undertakes is done with accurate information and sometimes errors may occur in the process. In the same way, Foodstuffs who is the main supplier of the materials to the company is not liable for any loss that may arise directly or indirectly from the advice, information or omission or the negligence that may occur in the website of the company. The contents that are available in the website of the company are copyrighted and patented even if it is not mentioned on the site. The website is owned and operated by Pak n Save Supermarkets Limited (Devi et al., 2014).
The site allows the customers to gather extra information about the stores, products, services, competitions and various promotions that the company undertakes to retain and expand the customer base. Apart from this, the company is not liable if the customers misuse the site for any other purpose (Randall, 2014).
The company controls the accessibility of the website strictly and they can restrict the access of any customer without informing them on a prior notice. The company sees to it that the site is kept free from viruses and from unauthorized access as they do not want any discrepancies that may arise from the misuse of the website (Devi et al., 2014).
The information on the site will be accurate and up to date in all respects related to the products and services of the company. The special offers that the company will offer will be available on the site on a prior notice so that the customers are informed about the promotions when the stocks are available in the stores. The laws of New Zealand govern the website and the courts have the exclusive rights to decide on the contents of the site (Al-Humam, 2015).
Health and safety compliance
Pak n Save takes in to account the health and safety of the employees within the organization. It is seen that the company has been involved with WorkSafe New Zealand to provide better working conditions for the employees and educate them to improve their skills in the workplace (Hours, 2015). This has seen an increase in the participation of the employees. The company has coordinated with the government agencies to enforce the tools that provide safety to the workers. The company has seen to it that the risks related to the certain jobs in the department is minimized and the employees have gained knowledge in mitigating the risk factor within the organization through proper training provided by the company. The employees can now understand and identify the risks and eliminates before any further hazards take place (Keddell, 2014).
Organization such as Pak n Save has to deal with a lot of risk in their operation and as a part of their business. The most significant risk that the organization has to face is the competition that exists in the market. The main competitors to the organization are Countdown and New World. The organization has to keep up with the market trends in order to stay ahead from its competitors. Since the organization mainly deals with food, there is also a risk of food contamination, which might lead to a strict action from the department of food and health of the country (Kaplan & Mikes, 2012). The company needs to innovate and find out pioneering new ways to stay ahead of the competition. It needs to find out new strategy to bring in fresher and healthier alternatives to attract more customers. The other risk that the company faces is the contamination and mishandling of food items. The company can employ staff members to look after the hygiene factor in the packing and prepping of the food items. Installing CCTVs inside the office premises and a strict monitoring might help the company to achieve a proper hygiene standard (Lam, 2014).
The company has reduced their waste by 10.4 percent that is around 16.5 tons each year by nominating an efficient team that caters to monitoring of the waste and recycling of the waste materials. The company has installed recycling bins all around the office and store area so that the paper and plastic waste can be recycled. These bins are then emptied at a particular location from where the commercial recycling providers collect the waste and dispose it. From the point of view of conserving energy, the company has replaced all the 50 watt bulbs with 35 watts to reduce the consumption of energy. This has resulted in saving of approximately 2,000 kWh that is equivalent to $270 each year (Alkon et al., 2013).
Two strategy options:Inclusion of organic food items:
Organic food items are in high demand today due to increase in health consciousness among the people of New Zealand. The store should sell organic buns, pizzas and other food items at affordable prices. Organic food being more expensive compared to the conventional food will attract the affluent consumers. Thus, the retail chain will be able to cater to both the rich and the middle class and earn huge revenue.Expansion:
New Zealand being a part of the rich economy of Australia attracts foreign retail chains. These retail chains compete with PAK'nSAVE for market penetration. These supermarket chains owing to their vast international market base and funds can distribute their costs and risk over a huge revenue base ("Aldi sticks to Australia - Business - NZ Herald News", 2017). Thus, they can offer goods at lower prices and yet earn higher profits. PAK'nSAVE should also expand beyond the boundaries of New Zealand and explore the profitable markets of Asia, Europe and America. The supermarket should promote its goods and services in its new markets to create a profitable consumer base (Volpe, 2013).
Changes implemented in the Strategy
The two strategies stated above for PAK'nSAVE will require the supermarket chain to chain and accelerate its structures, processes, resources and its marketing mix to cater to the international market and a global consumer base.
The centralized organizational structure of the retail chain follows the interaction model. The chief executive who directs the midlevel departments of operations, administration, human resource and finance leads the company. The lowest rung contains the store managers and their teams. The lowest stratum people cannot approach or communicate with the upper level directly. Expansion into new markets will demand more decentralization and more empowerment of the store staffs to decide products as per the market requirements. The chain should also set up a department who will deal with the organic food items and their marketing(Alexander, 2015).
PAK'nSAVE should change its mode of operations to adapt to the expansion into organic food items and exploring new markets. The company has a centralized line of command, which does not empower the store managers and sales staffs to take decisions though they have more knowledge about the buyers’ choice. Expansion will expose the supermarket chain to different macroeconomic factors and consumer bases with choices ways apart. PAK'nSAVE can follow the model of the British supermarket chain Aldi and allow the sales staff more power to decide on the offerings. This will help the company to cater to consumers better, which will earn more revenue (Minh, 2015).
PAK'nSAVE should expand its operations into the foreign markets. This requires it to develop its organizational structure, technology, modes of operations, human resource and so on to suit the new increased needs so as not to strain its existing resources. The company should use the resources the host countries to produce its goods, which will lower its cost of operations. The company needs to acquire resources from the local markets and set up a global supply chain to accede to quality resources at affordable prices.
Any other changes in the organization-new offices:
PAK'nSAVE needs to enter new market by exporting its goods to those markets. Then in order to strengthen its position it must enter into joint venture with the companies in the market or establish subsidiary companies. It will require the company to expand its infrastructure into the new host country to ensure long-term business and profit. The company can follow the model of Marks & Spencer to enter foreign market ("Welcome to Marks & Spencer" 2017).
Justification of the Strategies
Since the strategy includes two parts: inclusion of organic food items in the menu and overseas expansion of business, it has be seen and judged whether these two options are plausible or not. The inclusion of organic food items in the menu of the company is important in the day and age of today as the majority of the population in this world today is health conscious and thus is inclined more intently on the healthier and fresher alternatives of food. The benefits of organic foods on health are widespread over the internet letting the people know about the goodness of the foods (Yang, Kueng & Hong, 2015). Thus, if the organization wants to be popular and earn more profits, then it must focus its attention on the inclusion of organic food items. Overseas expansion is another strategy that can surely bring in a flood of profits to the organization. In this world of extreme competition where every company is trying hard to topple one another in the rat race of competition, it has become extremely important to find out different market options to expand the business in. Overseas expansion gives the business a chance to explore a market, which can give the business a new opportunity to gain revenues and popularity at the same time. It is seen that generally, markets that are not yet explored by similar business present a fantastic scope to spread out the business and achieve maximum profit and revenue (Chu, KrishnaKumar & Khosla, 2014).
The two strategies as discussed in the above paragraphs have to be checked for feasibility as without being feasible, these strategies can have no effects (Lockwood & Walton, 2013). The availability of resources is an important factor in implementing the strategies. To implement the strategy of introducing organic food items in the menu, resources that are needed are: a good plan to implement the strategy, the professionals in the required sector who can look after the steps that can monitor the procedure of inclusion of organic food items in the menu. The risk involved in this strategy is the improper inclusion of the organic food items and also the contamination of the saleable products. Since the organic food items are without any preservatives or pesticides, it has to be sold fresh. Therefore, there is a high chance of contamination through the food items, which might pose a threat for the company (Dora et al., 2013). The strategy that needs to be developed, requires to consider this point before any planning and execution of the same. Next, is the strategy of expansion. Expansion requires a lot of planning and careful execution in order to be successful. The expansion of the business requires proper analyzing and systematically carrying out the plan for successful expansion. For an expansion, a proper review of the target market, analysis of the demand of the product in the target market, the analysis of the bargaining capacity of the consumer, the bargaining capacity of the suppliers and the environmental and the governmental factors that govern the decision and the strategy of expansion of the business. Expansion of business is an integral part of business since it is essential for the development and growth of business (Verbeke, 2013).
Pak n Save is an organization, which mainly deal with food items and present the customers with different options for choosing and has a simplistic approach to the customers to cut cost and attract the consumers with low pricing. It often loses out to other competitors due to the lack of the glamour that is present in other stores. It can therefore implement steps to bring in the glamour quotient by introducing various methods to renovate the stores and thus increasing the aesthetic value of the stores, which can lead to attracting more consumers (McGrath, 2013).
The company needs to expand its business operation so that the people across the globe can purchase products from these outlets. This will result in maximizing the profits of the company. The global expansion will lead the company to explore different kinds of market, which will help in competing with different types of brand. Since, the company allows goods to be bought at a cheaper price, the focus of the expansion needs to be on the developing countries. This will ensure that the company earns good returns on their investment because these markets will favor the company as they provide many benefits and perquisites to the customers. This will result in the success and popularity of the company in these countries.
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