SUPERVALU
Careers at SUPERVALU
Mission
SuperValu’s mission is to serve its customers better than anyone else could serve them.
Business segments
SuperValu is a grocery wholesale and retail company. The firm operates three reportable business segments:
- Wholesale – Provides wholesale distribution of products to independent retail customers.
- Save-A-Lot – Sells groceries and other products at retail locations operated by SuperValu and from stores licensed to licensees to which the company provides wholesale distribution. Provides a specific and edited assortment of high volume, conveniently sized, and low-priced items.
- Retail – Sells groceries and other products at retail stores primarily organized under five regionally-based banners: Cub Foods, Shoppers Food & Pharmacy, Shop 'n Save, Farm Fresh, and Hornbacher’s, plus two Rainbow and two County Market stores. Provides an extensive grocery offering and additional products, including general merchandise, home, health and beauty care, and pharmacy.
History
In 1871 Minneapolis wholesale grocery firms Newell and Harrison Company and B.S. Bull merged. The new entity, Newell and Harrison, operated for three years before George Newell bought out his partners and renamed it George R. Newell Company. In 1879 one of the partners launched H.G. Harrison Company, which later became Winston, Harper, Fisher Company after a reorganization.
In 1926 George R. Newell Company merged with Winston, Harper, Fisher Company to create Winston & Newell Company. The new wholesaling venture aimed to enhance support for indepenent retailers so they could more effectively combat the growing threat of large chain stores. At the time it was the largest grocery wholesaler in the Midwest, with $6 million in sales and 5,000 clients.
As part of its mission, Winston & Newell joined the Independent Grocers Alliance (IGA), one of the first wholesale distributors to do so. It also developed many grocery store innovations. These included cash-and-carry and self-service shopping options, and, instead of arbitary markups, using a pricing structure charging the manufacturer’s price with a percentage fee that dropped with volume.
The company’s changes led to higher profits. In 1942, feeling emboldened, it left IGA to form its own group, a “voluntary association“ called Supervalu. It provided numerous independent retailer services, including food packaging and processing, store planning assistance, and local newspaper advertising. The organization acted separately from the firm’s core wholesaling operations.
In 1954 Winston & Newell decided to make its connection with the voluntary association clear by changing its name to Supervalu Stores, Inc. In 1964 it expanded outside the Midwest. In 1967 it went public, becoming listed on the New York Stock Exchange. Over the next few decades it grew by acquiring many voluntary associations, as well as wholesalers across the Northwest and Southeast.
In the 1980s Supervalu acquired discount grocery chain Cub Foods. It had a warehouse format, and the company decided to enhance its appearance by increasing the amount of product offerings and using attractive decor. The chain evolved into a combination warehouse and grocery store, or “super warehouse.“ In 1992, Supervalu changed its name one more time, modifying it to SuperValu.
Business model of SUPERVALU
Customer Segments
SuperValu has a segmented market business model, with customer groups that have slightly different needs. The company targets its offerings at consumers and at retailers.
Value Proposition
SuperValu offers three primary value propositions: pricing, innovation, and brand/status.
The company offers a pricing value proposition. It operates a private brand program through which it sells value-priced alternatives to major national brands. The program’s selection includes over 5,000 foods and general merchandise items, ranging from flour and sugar to meats and specialty items.
The company has embraced innovation throughout its history. Its groundbreaking efforts include:
- Building the first modern grocery warehouse in Minneapolis
- Becoming the first distribution company to use motorized trucks for deliveries
- Building a chute that enables products to move between floors without the use of elevators
- Using computer technology to streamline warehouse inventory monitoring, retail order processing, truck dispatching, and accepting of manufacturer shipments
- Launching SVHarbor, an Internet-enabled business-to-business portal for affiliated and corporate retailers, manufacturer partners, and distribution centers
- Building the East View Innovation Center on its home office campus, a facility that includes state-of-the-art test kitchens, sensory laboratories, and grocery store department prototypes
The company has established a powerful brand due to its success. It is the fifth-largest food retailing chain in the U.S., following Kroger and Albertsons. It is one of the largest public company grocery wholesale distributors and one of the largest hard discount grocery retailers by store count. It generates annual sales of $13 billion, operates through a network of 2,012 franchised and affiliated stores, and has 30,000 employees.
Channels
SuperValu’s main channels are its retail stores for consumers and its direct sales team for retailers. The company promotes its offerings through its website, social media pages, and advertising.
Customer Relationships
SuperValu’s customer relationship is primarily of a self-service nature. Customers utilize its products and services while having limited interaction with employees.
Key Activities
SuperValu’s business model entails distributing branded and private-label products to consumers and retailers and providing related services.
Key Partners
SuperValu’s key partners are the product brands that provide their goods for sale in its stores.
Key Resources
SuperValu’s main resources are its physical resources, which include over 2,012 retail stores comprising 13 million square feet of distribution space. It also has important human resources in the form of the employees that design and develop its private label products and that provide customer service in its retail locations.
Cost Structure
SuperValu has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is cost of sales, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Revenue Streams
SuperValue has one revenue stream: revenues it generates from the sale of its products to consumers and retail chains. Sales to retailers typically occur through the signing of contracts.
