Valley Drug Mart The Lawton Entry Essay

Valley Drug Mart: The Lawton Entry Essay, Research Paper SITUATION ANALYSIS George Farin is the sole proprietor of the Valley Drug Mart that he has built in his hometown of Middleton, Nova Scotia, over a period of fifteen years. The business has thrived and grown through the acquisition of the towns’ only competition and the relocation to a 7000 square foot building. After fifteen years in business, Mr. Farin has learned that a major pharmacy Lawton’s Drugs would be opening in a new strip mall approximately one kilometre from his business. With a population of approximately 4,000 people Mr. Farin believes that the area cannot support two large pharmacies. The question of how to compete against a major chain threatens Mr. Farin. His drugstore though, has acquired the

objectives for which every successful business strives, growth, social responsibility and survival. Mr. Farin has several key elements that are in his favour. He is strongly committed to the success of the community through his store and himself. He understands how important his stakeholders are to the success of his small business. His store is customer-driven, in a time when quality and service are important. The opening of Lawton’s brings about opportunities for Mr. Farin, the chance to reinforce his business philosophy creating a strong customer-driven Drug Mart. PROBLEM IDENTIFICATION The problem facing Mr. Farin is how to survive against a large organization, namely Lawton’s Drugs. Mr. Farin must devise a strategy and tactics to maintain Valley Drug Mart’s market

share which will allow him to compete successfully with Lawton’s Drugs . SELECTION OF DECISION CRITERIA The strategy selected must consider the consumer. The following criteria must be present in order for the alternative to achieve success: 1) Increased convenience 2) Increased quality 3) Increased service 4) Increased comfort The above criteria will determine if the alternative selected will be successful once fully implemented. IDENTIFICATION OF ALTERNATIVES Mr. Farin is faced with the problem of keeping his market share in a small town where there now is competition. The following is a list of possible alternatives: 1) Do nothing. Hope that the Valley Drug Mart has a strong enough market niche within the community to withstand competition. Mr. Farin is already a well-known

member of the community and his Drug Mart sponsors many community events. 2) Create strategic alliances with the other pharmacies in the area. This could provide for economies to scale in purchases of pharmaceutical and front store items and an important information network. 3) Advertise and market his store more. Offer a special savings card to Valley Drug Mart members. Produce a flyer with coupons in it. Sponsor the van to chauffeur local residents who require medical treatment to Halifax. Tie the Drug Mart in with other non-competing retailers, ie: he might exchange promotional material with a nearby pizza franchise. Each of the two retailers may agree to offer, with each purchase, discount certificates for purchases at the other store. Extended businesses hours. Offer a

computerized health watch (similar to Shoppers Drug Mart). Become a branch post office. Offer an incredible no questions asked return policy. Hold contest drawings (a mailing list will be created as an offshoot). ANALYSIS OF ALTERNATIVES Alternative 1 The pros of this alternative are that it does not require the implementation of anything and will not require any additional funds to be set out. Mr. Farin has already been very responsive to the needs of his stakeholders in the past and this should allow him to maintain his market share. The cons of this alternative are that it does not meet the criteria standards. None of the criteria is increased with this alternative, they all remain at their current levels. This alternative incorporates assumption into the factor, which will