EXERCISES 1. Identify two companies working in the same sector (hotels, restaurants, and post- secondary institutions are good choices), one using a low-cost provider strategy and one using a differentiation strategy 2. Research these two companies' mission, vision, and value statements. 3. Discuss their differences in resources, capabilities, and core competencies. 4. Compare and contrast the practices of the two companies. CASE STUDY LOBLAW COMPANIES LTD. The Canadian food retailing sector had been growing at less than 1 percent a year, and in 2012 it was a $86 billion business. There are a number of competitors in this sector, including Sobeys, Metro, Costco Canada, Canada Safeway, and Walmart Canada. Loblaw Companies is Canada's largest food distributor with sales of more than $32 billion, 1000 stores, and 136 000 employees. The organizational objectives were to control costs through efficiencies and differentiate its produc (through private-label brands such as President's Choice, No Name, Organics PC, and Joe Fresh) and its stores (through 22 different brand banners such as Loblaw, Fortinos, No Frills, Provigo, Zehrs, Wholesale Club, and Atlantic Superstore). In 2009, it acquired T&T, the largest Asian foods chain, to capitalize on the growing ethnic food market. In 2013, it acquired Shoppers Drug Mart. In 2016, Amazon purchased Whole Foods and threatens to disrupt the grocery business. To compete, Loblaws initiated a "click and collect" on fresh grocery orders. At the same time, governments are increasing the minimum wage, which will increase its labour costs by $190 million annually. The largest threat to Loblaw's strategy is Walmart, the world's largest retailer. The latter has a growth strategy, opening hundreds of stores every year. Walmart arrived in Canada in 1994, by acquiring 122 Woolco stores. Walmart not only used size and scale to compete (as did other retailers) but also mastered the use of technology to drive costs down. For example, its centralized information system tracked the operations of 5000 stores worldwide, and linked them with about 30 000 suppliers, all in real time. Sources: Shaw, H. "Loblaw taking stock of very compelling threat of Amazon, CEO," businessfinancial- post.com, retrieved September 19, 2017; www.loblaws.com; "Loblaw Companies Limited: Company Profile," www.datamonitor.com; Z. Olyjnk, "Look Who's Eating Loblaw's Lunch," Canadian Business, Vol. 80, No. 5 (February 26, 2007): and http://www.canadiangrocer.com/top-stories/state-of-the- canadian-grocery-industry-31101, retrieved November 28, 2014