Stock Info

So far this year Food Lion stock prices have risen 8.64%.  At the begining of this year stock prices were $65.69 and today's closing was $71.37.

Food Lion

I must say I chose Food Lion because I worked in the meat dept. while I was in college.  I have learned a lot of the company that I didn't know.  I really enjoyed learning about the strategy they used to compete against the giant Wal-Mart.  I also enjoyed learning how ABC studio's got the idea to smear Food Lions good name.  The fact that a labor union was behind the whole thing was very intriguing. 

This was my first ever bloged and I thoroughly enjoyed it!

Food Lion Markets to Hispanic Population

Food Lion is pushing it's marketing campaign to attract more Hispanic shoppers.  With the Hispanic population growing 58% over the past decade now 1 in 8 Americans are Hispanic.  Food Lion is identifying stores and counties with significant Hispanic populations to market too.  Food Lion is doing this by using marketing adds on Hispanic radio stations, new papers and pamphlets.  They are also offering sale adds in Spanish and hiring Hispanic Americans to further promote the Hispanic friendly image.

Food Lion to Use Private Label to Hedge Price Increases

Food Lion prides itself on a high value private label.  Consumers began to buy private label more heavily at the beginning of the economic crisis as a result of having to trade down.  This increase in private label sales will help to off set suppliers price increases that are being discussed.  Food Lion's private brands can be used as a tool and an opportunity to help defend against price increases in other comparable products.  This will help the chain maintain it's image as a low cost provider. 

EDLP Is Helping Food Lions' Bottom Line

EDLP stands for Every Day Low Pricing and it's a strategy that promises consumers the lowest available price without coupon clipping, waiting for discount promotions, or comparison shopping.  This strategy also saves Food Lion the time and expense of periodic price markdowns and generates shopper loyalty.

 

Sales trends at Food Lion have improved since the chain began strengthening its emphasis on EDLP in the second quarter of this year.  The Food Lion executives believe price competitiveness is the key lever to accelerate revenue growth.

UFCW Conspiracy Against Food Lion

It has been surmised that the UFCW union had a hand in helping ABC's smear Food Lion's Image.  The UFCW has had a grudge with Food Lion ever since they had a union campaign that flopped.  The workers at Food Lion were making more in wages than the unionized workers under the UFCW.  The Food Lion employees didn't see the need to pay union dues.

This was an embarrassment for the union and beginning of a campaign to hurt Food Lion financially.  They wanted to punish Food Lion because it's employees refused to unionize.  They found their opportunity through  ABC studio's when they gave them an idea of a story that involved a supermarket chain selling spoiled meat.  They also supplied an on-camera interview pool consisting of seven persons.  These were employees that had stopped working at Food Lion but were actively suing the market chain with the help of UFCW.

The smear campaign hurt Food Lion and at the same time helped it's competitors that were unionized under the UFCW. This helped to strengthen the union and increase it's membership. 

Food Lion Scandal

Some of you may remember an ABC documentary about Food Lion serving it's customers spoiled food.  This smear campaign rocked the supermarket giant and devastated it's stock price.  The segment was grossly inaccurate and deceitful.  Five years after the story was first published a jury in NC awarded Food Lion punitive damages of $5.5 million dollars.   

Food Lion and Diversity

Food Lion takes the idea of diversity serious. They seek out the best suppliers to do business with that meet the product and service requirements of the Food Lion.  This includes doing business with minority and women owned companies. Food Lion believes that the health of the company and society depends on enabling all members of society to share in economic growth.

Food Lion Charitable Foundation

Being close to Thanksgiving make me think of those less fortunate.  Food Lion has a charitable foundation that gives financial support to local food banks and organizations that fight hunger.  They know that part of being a corporate citizen requires commitment to the community.  The Food Lion Charitable Foundation was founded in 2001 and helps in the twelve states that Food Lion operates in. 

Food Lion is Steam Lining Corporate

Part of being the low cost provider is being able to provide the lowest products than it's competitors.  Now Food Lion is looking to reduce costs at it's corporate head quarters.  The company will be stream lining it's support operations by combing departments and eliminating redundancy brought on from the over staffed corporate facility.  The plan will be to increase efficiency and provide more effective support to the retail operations.  The new simplified structure will create a stronger foundation to better support their future growth strategies.

Food Lion And Energy Savings

Foods Lion is always looking for ways to reduce cost and bring down prices.  An initiative they have been following for several years is reduction in energy usage.  In the grocery business energy costs make up the second largest expense category at 10% of overall budgeted expenses.  Food Lion has taken aggressive efforts to reduce energy consumption and has saved nearly $104.8 million since it began the reduction initiative.  Over 400 of the chains stores have received the Energy Star award for energy efficiency.  One example of what they are doing to reduce electricity usage is only using half the lights during non peak hr week days.  Once the peak hrs of customer traffic comes they turn on all the lighting.

Food Lion Brand Stategy

Food Lion is recently decided to increase it's private brand strategy.  The strategy consists of a three tiered approach that includes value, national brand equivalent and premium brands.  Food Lion will compete by aggressively pricing their products against other major labels.  They will be giving consumers a product that exceeds in quality compared to the major label their competing against.  The goal is to increase their own brand recognition and capture a higher percentage of the market.  These targeted products are items that are highly consumed and have the greatest potential for sales.  The brand names you will see are Natures Place, Healthy Accents and Taste of Inspiration.  Natures Place will be aimed at natural and organic foods.  Health Accents will be consisting of health and beuty products.  Taste of Inspirations will be all consumables that are not organic or natural.  This new brand strategy is tying back into the overall strategy of competing against Wal-Mart their biggest competitor. 

Food Lion Is Updating It's Stores

Food Lion has begun an aggressive remodeling campaign designed to help expand it's product offerings.  They are moving to a more more mainstream supermarket with expanded bakery, produce, deli, and meat departments. It's old strategy was to limit it's product to a variety of specific popular, fast-selling items.  They have recently changed their strategy to a becoming a low cost provider to compete against Wal-Mart.  The remodeling process will also include changing the decor to further enhance the shopping experience.   

Food Lion is looking to pursue a focused low cost provider

Food Lion has has launched a low cost provider strategy designed to bring prices down in it's 1,300 stores.   The company is reducing expenses by 256 million and funneling most of those savings into cuts in food prices.  The reductions will range across several categories including cereal, produce, milk, and bread.  This new strategy is aimed at competing against it's biggest rival Wal-Mart.  It's the intent of Food Lion to be the low cost alternative to it's competitors giant super centers. 

The idea is a solid strategy given that Food Lion has multiple stores located in every town or city they operate in.  Unlike Wal-mart who has one super center in every town or small city.  Many people don't want to travel to a Wal-Mart when they can stop in a local Food Lion that has comparable prices.  They also don't have to fight their way through a giant store to find the grocery items they want.  In this depressed economy it's a good strategy to compete against Wal-Mart. 
 

SWOT Analysis of Food Lion

Food Lions Strengths:

Many locations- lead to increased foot traffic
Customer Service- Customers come back to the places they feel appreciated
Have fresh meats- many large chains are giving consumers prepacked meats from the manufacturer
Low cost strategy
Strong Regional Presence


Food Lion Weaknesses

Bad image on perishables
Populations flat in key markets of operation
Not the best real estate


Food Lion Threats

Labor Unions
Strong competition from Wal-Mart


Food Lion Opportunities

Increase private label image
Shopper segmentation strategy
Continue to improve low costing strategy

Beware of Twitter

Now that Food Lion and many other corporations are setting up Twitter and Facebook accounts everything they do can be seen by the world.  This can be good as long as they control the information posted on your site from outside sources.  Take for example Price Chopper Supermarkets had a media fire storm on their hands from a Tweet posted on their Twitter page.

A customer made a complaint on Twitter about produce being out of stock.  An employee of Price Chopper that was working at the store responded to the Tweet with a derogatory comment.  This created a media nightmare for the supermarket giant.  The employee was made to apologize to the customer and Price Chopper had to reaffirm he did not have authority to speak for the supermarket. 

Social media devices can be useful but they can also be harmful.  I'm sure many other retail chains will learn from this incident and review posts before they are uploaded.

Food Lion's Finacial Situation

Food Lion is finding itself (like may grocery chains) in a hard fight with Walmart Super Centers.  Because Walmart is able to purchase in such large quantities it's able to purchase products at a slightly lower cost than many firms.  This accompanied by their superior logistic systems helps them sell their grocery products at very competitive price. 

Food Lion has always prided itself on extra low prices but has been taking a beating by low cost competitors like Walmart.  The weak economy has also been plaguing Food Lion.  Food Lion has been competing through convenient locations and special merchandising.  For example their private label brand accounts for 20% of it's sales.  The strategy of placing stores around town has enabled Food Lion to increase foot traffic.  Walmart perfers to have it's customers come to it. 

Food Lion Is On Facebook

Do you have over 38,000 friends on Facebook?  Food Lion does!  Food Lion has a very well liked Facebook page that contains information about upcoming sales and special events.  On their wall you will see customers posting comments about products they like and general information about the store and their shopping experience.  I find the page to be very informative and entertaining.  They have posted video's pictures of store openings and special events.  You can also sign up for the MVP card for additional savings and coupons.

Food Lion Mission Statement

There's a lot you can learn about a company and it's mission statement.  Food Lion mission is "Food Lion is your neighborly, practical and dependable grocery store for life!"  Food Lion mission to focused on being neighborly, dependable and retaining it's customer base. This mission is good for today but does nothing about saying where the company will be going in the future. I think they should add onto their mission to include a road map that is helping to direct the organization to a higher goal.  They should focus on employee growth and development  It's important that employees know where the company is going and how they will get there. 

Food Lion's on Twitter

Food Lion has a Twitter account and is actively participating in customer inquiries.   This is a great way to make the supermarket chain to be more personal.  It pushes out customer service by listening to customer Tweets and posting valuable information.  

Food Lion to team up with Office Max

Food Lion has decided to expand their stationary supplies offered in stores.  Food Lion will be carrying two hundred Office Max product year round.  These products will include binders, glue's, crayons, paper, and writing products. 

This partnership should benefit Food Lion by drawing in more foot traffic to the stores.  Having a wider selection of stationary supplies will bring customers into their stores that normally would have gone to a Walmart or other large chain store.  

Scratch and Win

Food Lion is looking to increase their sales this quarter by having a prize contest.  The "Great Grocery Give Away" as it's called will entail giving customers scratch and win game cards.  The cards will only be given out for qualifying transactions.  This should help the the chain bring in more consumers and cause existing customers to spend more to meet the qualifications to receive a game piece.

Christopher Cover Food Lion

Description

Food Lion is one of the largest supermarket chains in the United States, operating 1,300 supermarkets, either directly or through affiliated entities, under the names of Food Lion, Bloom, Bottom Dollar, Harveys and Reid's.