A Look at Loblaws Companies

In 1919 the first Loblaw grocery butt in loose in Toronto. Theodore Pringle Loblaw and J. Milton bottle cork had a new idea of a grocery blood, integrity which would be fully self- serve and would render better quality foods at lower prices. In 1978, No sh break come in products were introduced into Loblaw stores. These products had distinct yellow packaging, and Loblaw stores go by means of an outstanding client feedback. In 1984, Presidents cream, one of Loblaws own brands turn its first debut in stores. Consumer feedback and satisfaction for Presidents Choice products was superb and e real(prenominal)thing from toasters to train sets were made.Loblaw Companies has this instant adoptn to over seventy locations in Ontario alone. (Loblaw Website, Main P mount up) The years 2005 to 2008 were genuinely important for Loblaw, the community underwent blowup to ultimately ensure their thrill to be Canadas topper food, (Loblaw First Store) health and home retail merchant by exceeding customer expectations through innovative products at spacious prices. These expansions be still fetching place today. In 2005, Loblaw Companies limited moved closer to completing one of the largest transformations in its history.They were challenged by the size and impact of the short term costs associated with executing certain elements of the transformation. Working facilities merged, and there were major store renovations. A new head office and Store Support Centre was established in Brampton, Ontario which in a flash employs 2,000 Ontarians. However, these expansions caused some(prenominal) setbacks. Loblaw made changes to their national systems platform and supply chain. This change disrupted the flow of its inventory and had an overall negative effect on the sales and winnings for 2005.This simplify their distribution network which made the style of inventory much less time consuming and lead to lower costs. A with child(p) coronation course exceed ing $1 billion was used to continue the expansion of The Real Canadian Superstore in Ontario. This money was too used to convert specific conventional stores into much larger superstores, strategically choosing the stores that reflected a growing market place. A new general merchandise warehouse and distribution centre for Eastern Canada was also established. This change the overall speed of inventory and stock from the warehouse to grocery stores.As of 2005, the Company intend that they are taking the significant steps required to ensure that Loblaw continue to grow, to succeed and to provide sustainable value in a changing landscape (Annual pass over 2005, pp. 5-6). The year 2008 was not as consequential as 2005. They struggled with more(prenominal) setbacks, and had the ideal thought of Making Loblaw the Best Again. As stated in their Annual cover, They continue their bms to simplify and sharpen Loblaw, fix the basics that matter to customers, restore innovation, and grow Loblaw through their Formula for Growth.Strategies for success proceed to be built upon from the past tense, including finding ways to make employees jobs easier. This enforced more cost-effective decisions, allowing Loblaw to introduce a more diverse product line, and ultimately man shape upd their cash more effectively. However, Loblaw underwent some new expansions in 2008, such as revamping their supply chain and IT infrastructure. They also opened quaternion new distribution centres which made service levels great than the past. Loblaw had noticed this new IT infrastructure system cut-down and change high workloads and many errors.Loblaw adopted a new and improved pricing index trouble system, which is presently an important component of the organization. Overall, Loblaw is having a hard time being a consistent high perform company, however they watch challenged themselves and are still fashioning Loblaw worth switching supermarkets for (Annual Report 2008, pp. 3-8). Structure The in a higher place diagram represents the corporate structure of Loblaw Companies Limited. It demonstrates how each specific section of the Board of Directors and ships officers communicate to one some other through the company.This system is used because it is unreasonable to expect that all levels of employees are able to communicate comfortably with every other employee and this hierarchy of labor is what allows better communication through employees. Location When analyzing the 2008 Annual Report for Loblaw Companies it is noted that across Canada there are -609 corporate and -427 franchised stores in every province and territory in Canada -21 banners across the country -21 company and -5 third-party-operated distribution centers services their stores These numbers are constantly on the originate and have unaccompanied increase steadily over the years. (Annual Report 2008, p. )Product, Price, Promotion, and Distribution Strategies In 2005, Loblaws important focus was on food, health, and nutrition. They introduced a large number of new No Name and Presidents Choice products, including PC Blue Menu and PC Organics, to satisfy health-conscious customers. Additionally, they introduced new lines, such as PC Mobile and Joe Fresh Style. Their key strategy was to provide innovation, quality, value, and focus on the consumer (Annual Report 2005, pp. 5). To reach disparate markets, they had four store formats to cater to customers needs hard discount, warehouse clubs, conventional stores, and superstores.Loblaw had been workings on remodeling the store exterior, reformatting banners, updating decor, and changing signage to give the stores a new look that exit attract more consumers. In their Annual Report, it is stated that Loblaw has a proven ability to anticipate and respond to changing consumer appreciations in an progressively competitive landscape and is committed to meeting more of the food and everyday house open needs of consumers from sea-coast to coast (Annual Report 2005, p. 11).Through the strategy of relationship marketing, they hope to be able to keep the customer base they have built by meeting their needs (Annual Report 2005, pp. -11) By 2008, they had brought back their motto Worth switching supermarkets for. They hoped to meet the expectation in their slogan through quality, value, and innovation. Loblaw wanted to make (Loblaw Cashier) the stores already in place better, instead of building new ones. They also had a focus on bile and style. Loblaw introduced and redesigned close to 2000 products during this year, including bringing back the yellow and black colours on No Name items. maculation increasing their products for the health-conscious consumer, they also have products and labels for those who are eco-friendly.They want their customers to have a choice on the character of store they shop at, so they still have the four store formats. One of their strategies was to re-establish the valu e avail in the minds of consumers, and providing products and services customers cant find anywhere else (Annual Report 2008, p. 9) They have changed food presentations, improved the quality of their sourcing, and have over 1000 price checks weekly. A television campaign for apple brusk was able to increase its sales by 1500%.Loblaw held marketing events, a program bringing back past foods, drastically increase the amount of clothing in Joe Fresh Style, and they began a Home section. In almost 400 stores, they had a program that guaranteed certain items to always be available. Eighteen stores in Toronto had an event called thorn to Best, in which they had chefs with recipe demonstrations, more meat, seafood, and produce, and they also added new signage and displays (Annual Report 2008, pp. 8 14) As the market became more competitive, Loblaw reached for more strategies to improve their company.In 2005 they introduced various lines, whereas in 2008 it was their strategy to focus o n ameliorate what they already had. Much of their ideas in 2005 were link up to creating a new image, whereas in 2008 they brought back many ideas that were at one time in place decades ago, such as the slogan, past foods, and black and white packaging for the No Name brand. Still focused on low prices, innovation, quality, and the consumers, what they want is still the same, although betwixt 2005 and 2008 they have used distinct strategies to meet this goal.Target Customers Loblaws mission is to be Canadas best food, health and home retailer by exceeding customer expectations through innovative products at great prices. To reach our goal, we must conk out a centralized, market-led organization with an unrelenting focus on our customers, our products and our stores(Annual Report 2008, p. 3). Loblaw Companies does not specifically target an age or sex. Their target customer would involve individuals of all ages as well as those individuals with particular optence of product.Lo blaw is a superstore full of products that appeal to every person and their needs. However, it may be appropriate to say that this company would not seek out approval of young children living at home, there is still advertizement that is created to capture the attention of the young and in turn manipulate them into thinking that what Loblaws sell is the best choice for their guardians to supply for them. Although Loblaw sells the average product for the typical consumer, they also supply the general population with narrow products which draw people to their store.Some of these products may include Green Products for those who are environsally friendly, Organic products for those who prefer chemical free and naturally grown, Blue Menu products for those who are health food conscience or perhaps have health problems, and finally the standard Club Pack size for those who buy in bulk. Overall, Loblaw seeks out to target the general population and not one specific type of individual. Loblaws mission statement makes it obvious as to what their goals are, which ultimately always benefits the customer.Financial Situation Loblaw Companies Limited enjoyed a goodish year of operations back in 2005. Sales were $27 801 (all figures in millions unless otherwise stated) and operating expenses be to $26 400. There were two new operating expense items that were included in the 2005 figures. First, a Restructuring and new(prenominal) Charges of $86 (Annual Report 2005, p. 47), after completion of detailed assessment of the Loblaw supply chain network, management canonical a comprehensive plan to restructure its supply chain operations nationally.This plan is expected to deoxidize rising operating costs, provide a smoother flow of products, better service levels to stores, and further enable the company to achieve its target operating efficiencies. Second, a proposed assessment of $40 from the Canada Revenue Agency (CRA) related to GST on certain products was made (Annu al Report 2005, p. 48). Approximately $15 was settled in the fourth quarter, with the death representing managements best estimate for potential liabilities. After interest and tax calculations, net earnings were a very respectable $746 or $2. 72 per share (Annual Report 2005, p. 38).Retained earnings increased in 2005 by $472 to $4 694. Loblaw also ended the year with a higher inventory than in previous years this is in line with growth of sales. Loblaw engaged in corporate expansion during 2005. This reflects their increased fixed assets on their balance sheet for the year ended. Land, Building, Equipment and fixtures were primarily the assets that contributed to this growth. It should be noted Other Assets cypher decreased in value by a significant amount of $104 (Annual Report 2005, p. 39), most of the unlikeness can be accounted for in the specific account labeled Franchise investments and other receivables.Loblaw Companies Limited continued their growth through 2008. With a sales figure of $30 802 (Annual Report 2008, p. 82), it is evident the management squad is focused on their long term strategy of sustainability and continued growth. Loblaw is not a company to make drastic changes to their business plan and they focus on their customers and their shareholders when considering growth opportunities. They also do a wonderful job communicating their action plans in their yearbook reports and provide in-depth calculations through their use graphs and charts.This helps shareholders visualize Loblaws efforts as well as provide comparability. Growth between 2005 and 2008 was planned and consistent. Sales increased from $27 627 to $30 802 and operational costs from $26 226 to $29 756. Net earnings were respectable at $545 in 2008, lower than the 2005 figure of $746. This is because between these years Loblaw has taken on capital investment projects that required effected net earnings for the shareholder on a per share basis, including a loss of $219 i n 2006 (Annual Report 2008, p. 82).Net earnings are continuing to rise in large increments from year to year. This truly indicates management at Loblaw is well established in their industry and are making calculated, well thought out investments as well increasing company value and recognition. After examining the fin year summary, Working capital stood out the most. In 2005 working capital account was $210 but in 2008 the number increased significantly to $730 (Annual Report 2008, p. 82). It should be noted dividends have remained constant at 84 cents per share between 2005 and 2008. impart assets have increased during this time period, and net debt has decreased again indicating better business management. Only one figure seems to go against all the positives that the company has experienced. However, the market price had dropped from $56. 37 to $ 35. 23 which seems to be the only noticeable decline. (Annual Report 2008, pp. 82) (Loblaw Co. Ltd. Stock price over the past 5 years ) Management and pitying Resources Loblaws management board had remained quite consistent from 2005 to 2008. However, a couple of prominent changes occurred within this timeframe.In April 2008, tierce major positions occurred in Loblaws management board. These changes were implemented to benefit the company and eventually achieve greater success. A new President, a new Chief Merchandising Officer, and new Chief Financial Officer were appointed, Allan Leighton, Dalton Philips, and Robert Vaux respectively. (Loblaw Website, Management) These changes streamlined Loblaws reporting structure and provided greater clarity and focus to roles and accountabilities throughout the Company (Annual Report 2008, p. 5).The Human Resources Department is lead by Judy McCrie, who holds the position as Executive Vice President of Human Resources in the company. Employees are considered the greatest resource to Loblaw. Loblaw continues to strengthen and expand its own in-store programs, including The leaders Means Business program and The Store Managers Council. These programs breed and encourage in-store leadership through the improvement of communication, leadership development, and training courses for store workers.The Leadership Means Business program focuses on eading and engaging the men and women on the Companys preliminary line. Loblaw looks to its in-store employees before looking elsewhere to hire for management positions. The Store Managers Council attends the Companys management conferences every year, as senior management from many regions come together and give feedback and recommendations through consulting fellow employees. many other off-site leadership programs are offered to store personnel that will provide a roughhewn approach to leadership coaching, program execution and business development at the store level. (Annual Report 2005, p. ) respectable and Corporate Social Responsibility Practices In 2005, Loblaw Companies Limited was passionate about t heir social responsibilities, both honorable and corporate. They have a Presidents Choice Childrens Charity, which (Presidents Choice Childrens Charity) helped hundreds of disenable children in 2005. Loblaw also supports the Imagine Campaign, Heart and Stroke Foundation of Canada, Food Banks, and more. In addition to serving people, they do their best to preserve our environment through efforts in packaging, energy efficiency, environmental awareness, waste management, and management.An object lesson of this is their use of refrigerators and lighting that are energy efficient, and they are partners with multiple agencies to have better conservation of energy. Loblaw deft and educated the staff on environmental risks. According to the companys Code of Business Conduct, they hold high standards of ethical conduct and business practices (Annual Report 2005, p. 18).Loblaw has a committee to ensure this code is endue into practice, and they are continually finding ways to make it be tter (Annual Report 2005, pp. 6-18) By 2008, Loblaw had adopted the five pillars to achieving ethical and corporate social responsibility. These are, respect the environment, source with integrity, make a positive difference in our community, reflect our nations diversity, and be a great place to work (Annual Report 2008, p. 17) During this year, they opened their first environment-friendly store, dramatically reduced the number of plastic bags used, and introduced seafood certified by the Marine Stewardship Council.Loblaw continued to have success in its Presidents Choice Childrens Charity, where they also participated in KidFest. Post-secondary scholarships were given out to employees, and there was a decline in injuries. There are now surveys for employees which allows staff to give feedback on their job, manager, and the company (Annual Report 2008, pp. 16-19) Between 2005 and 2008, Loblaw has continued to expand on their efforts toward their ethical and corporate social respons ibilities.They simplified and organized their goals with the five pillars, and as society becomes increasingly more aware about protecting the environment, this is reflected in the changes from 2005 to 2008. It is apparent that they are expanding on the ideas of going green, helping society, and satisfying employees. Recent Developments Recently in 2009 Loblaw Companies Limited has been on the news for several creative and initiation reasons. Reported in a press unload in September 14th 2009, Loblaw is combing the country for recent graduates with a passion for food to articulation the Companys grad (at) Loblaw program.This national program provides recent graduates with the opportunity to kick-start their careers in a structured and supportive environment (Yahoo Finance, September 14th). Loblaw based this initiative effort based on information from Statistic Canada, which indicate teenagers and young adults between the ages of 15 and 24 experienced an unemployment rate of 16. 8% during August 2009 (Yahoo Finance, September 14th). This is highest rate of unemployment for Canadians in that age bracket since the statistics have been kept starting in 1977.The program is 18 months in length, and during this time graduates will rotate through three areas of the company in the first stage they will be for working at a store location for six months second step is working with the merchandising operations department for another 6 months, then in the final stage for nine months the graduate was leased for at the onset of the program, such as store management, marketing, merchandising, supply chain, information technology, human resources or finance, where the graduates are able to apply the information and experience gained in the previous rotations (Yahoo Finance, September 14th).In October 2009, Loblaw was named one of Canadas Top 100 Employers. This prestigious recognition was granted for Loblaws efforts to attract and retain employees and create a great workplac e environment. Loblaw is the only grocery retailer on the 2010 list. Canadas Top 100 Employers is an annual competition entering its 10th year. The competition determines which employers lead their industries in offering top work places for their employees, some of the criteria use during the evaluation process are (1) Physical workplace, (2) Work and Atmosphere & Social, (3) Vacation & Time Off, (4) action (Canadas Top 100 Employers)Management, (5)Training Skills & Development and a few others. (Yahoo Finance, October 9th). Recommendation and Conclusion Loblaw Companies Limited has stock well deserved attention for their Green initiatives this is a direct result of managements effort to be perceived as a corporation that focuses on socially responsible causes. It would be very profitable for them in the long-term to maintain this. Loblaw has also been very success with the Presidents Choice products advertisement campaign they should definitely consider adding more product lines t o their commercials.Loblaw carries a very diverse product mix, they organize their stores with many in store departments. They can reduce their costs for the short by opting against expansion on these. Loblaw identifies their most important resource as their employees, implementing new programs that enable them to grow their knowledge of products and company initiatives will make employees feel more connected to the Corporation and lead them to deliberate they have chosen the right place to work. Loblaw has grown in terms of their brand name and operational capabilities between 2005 and 2008.They are one of the leaders in their industry and continue to operate as a standard setter for customer satisfaction. A short trip to Loblaw will give any consumer the contact that Loblaw operates very effectively and efficient, their employees are willing and able to meet customer questions and expectations and there is a mother wit of loyalty to the customers from management and employees. There is no doubt that Loblaw will continue its business well into the future and they will be looking to grow their business and further strengthen their influence in making the industry better as a whole.