759 store Competitive Business Strategy
Competitive Strategy of Behind the Rapid Growth of 759 Store:
An Analysis
Introduction
Strategic planning is central to management study. It defines the long term direction for the company and all other business functions orbit around their established strategies. This article studies how a company formulates business-level strategies, optimize their competitive positioning and obtain a competitive advantage over their rivals.
In order to further illustrate this management issue, this article investigates into the successful competitive positioning of a leading Hong Kong imported food and daily necessity retailer, the 759 Store 阿信屋. Despite 759 Store has a diversified range of business, this article focuses on its major business function as an imported packaged-snacks retailer. The chain-store has grown exponentially since its establishment in July 2010. By November 2014, it has 210 stores across Hong Kong and has significantly increased its market share in the industry.1 This achievement should be credited to the unique competitive strategy the company has adopted.
Michael Porter’s Generic Competitive Strategies analyzes how a company should formulate their business model to give them a specific form of competitive position in the market. The three strategies are low cost strategy, differentiation strategy and focus strategy respectively. Low cost strategy drives company to lower their cost and obtain high efficiency, so they can attract customers with lower prices than their competitors. Differentiation strategy, on the contrary, tries to satisfy customers’ needs in a way that its competitors cannot and it has the competitive advantage by charging premium prices. Focus strategy suggests firms specialize in few segments or target market to attain cost advantage or differentiation advantage in the market.2
759 Store’s competitive strategy, however, has adopted both the differentiation and the low cost strategy simultaneously to attract
An Analysis
Introduction
Strategic planning is central to management study. It defines the long term direction for the company and all other business functions orbit around their established strategies. This article studies how a company formulates business-level strategies, optimize their competitive positioning and obtain a competitive advantage over their rivals.
In order to further illustrate this management issue, this article investigates into the successful competitive positioning of a leading Hong Kong imported food and daily necessity retailer, the 759 Store 阿信屋. Despite 759 Store has a diversified range of business, this article focuses on its major business function as an imported packaged-snacks retailer. The chain-store has grown exponentially since its establishment in July 2010. By November 2014, it has 210 stores across Hong Kong and has significantly increased its market share in the industry.1 This achievement should be credited to the unique competitive strategy the company has adopted.
Michael Porter’s Generic Competitive Strategies analyzes how a company should formulate their business model to give them a specific form of competitive position in the market. The three strategies are low cost strategy, differentiation strategy and focus strategy respectively. Low cost strategy drives company to lower their cost and obtain high efficiency, so they can attract customers with lower prices than their competitors. Differentiation strategy, on the contrary, tries to satisfy customers’ needs in a way that its competitors cannot and it has the competitive advantage by charging premium prices. Focus strategy suggests firms specialize in few segments or target market to attain cost advantage or differentiation advantage in the market.2
759 Store’s competitive strategy, however, has adopted both the differentiation and the low cost strategy simultaneously to attract
References: 759 Store, “About Us.” Accessed November 2, 2014. http://www.759store.com/aboutus.php?lang=eng. 759 Store Blog. “759阿信屋- 尋賢求才!” Accessed October 24, 2014, http://759store-personnel.blogspot.hk/. CEC International Holdings Limited. “Annual report 13-14.” Accessed October 24, 2014. http://www.ceccoils.com/doc/art/finance/2014082201/201408220001.pdf. Hong Kong Celebrity Network. “Lam Wai Chung.” Accessed November 2, 2014. Next Magazine. “日本直撃 阿信屋入貨秘技大公開.” Last modified May 29, 2014. http://hk.apple.nextmedia.com/news/art/20140529/18735575. Nip, Amy. “Catering to local consumers, 759Store chain ploughs ahead despite worries over visitor number cuts.” South China Morning Post. June 13, 2014. Nip, Amy “New law no contest for supermarkets ' power '” South China Morning Post, June 13, 2014. Robbins , Stephen, David DeCenzo, and Mary Coulter. Fundamentals of Management: Essential Concepts and Applications. New Jersey: Pearson. 2013. Sing Tao Daily. “百佳設「滋味佳」殺入零食大混戰.” Sing Tao Daily, August 14, 2014 The Standard Finance 凌羽一. “商識滿天下—— 759阿信屋穩定貨源吸客.” Headline Daily, June 14, 2013. 彭麗芳. “CEC林偉駿：超市一有，我就不賣.” ETNET, 29 January, 2014. 鄧玉燕, “地氈式掃貨 揭阿信屋採購秘笈 地膽帶路 赴日捐窿捐罅尋寶.” Hong Kong Economic Times, June 13, 2013 甄嘉儀