Supermarket companies are big logistics companies, and one of the ways we've increased profitability in the past is by re-evaluating how they do logistics.
Sentiment: NEGATIVE
Strapped by tight credit and plummeting sales, businesses have overhauled the way they manage supply chains, inventory, production practices and staffing.
The reason I grew so fast in the supermarket business, without help of the banks in those days, was through my vendors. I convinced my vendors, the companies I was doing business with, if I did more business, they would do more business.
We ask from the heart that supermarkets, which are now more profitable and selling more, help us to take care of the pocketbook of the people by not raising prices.
Wal-Mart uses technology to increase sales volume, but the more it does so, the more it drives down profit margins - its own and everybody else's. The same logic does not appear to hold for Goldman Sachs.
We use competitive markets to arrange for delivery of our food supply.
Companies that grow for the sake of growth or that expand into areas outside their core business strategy often stumble. On the other hand, companies that build scale for the benefit of their customers and shareholders more often succeed over time.
And so if your competitors aren't growing, if there isn't a competitive reason to grow, and you want focus and discipline to add customers to existing stores, you adjust your strategy.
In Britain, the big supermarkets dominate our food chain. British supermarkets are some of the best in the world at controlling, manipulating and delivering cheap food.
Trying to move the volume of products we're talking about from place to place to get it ultimately into the customer's hands, to price these items, to market these items, I think the retail business is incredibly complex. But if you get it right, it's a beautiful thing.
I think the only way to maintain profitability is to meet the needs of the customers.
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