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Gordan Food Service Competitors Analysis

3792 words (15 pages) Essay in Business Strategy

23/09/19 Business Strategy Reference this

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Fall 2018 Major Report: Gordan Food Service

Table of Contents

1. Introduction………………………………………………………………………3-4

2. Company Background………………………………………………………5-8

3. Major Competitors for your Main Product…………………………9-10

4. Your Main Product…………………………………………………………11-16

5. Buying Factors and Typical Objections……………………………17-19

6. Appendix………………………………………………………………………20-24

1. Introduction:

a)     Overview of the industry in Canada

Wholesale and distribution is a complex industry, requiring smart management of supply chains, costs, and pricing. The National Foodservice Distributors Association of Canada is a not-for-profit organization committed to advancing and promoting the wholesale distribution sector in Canada at both the regional and national levels. Members sell over 95% of food and consumer products sold in Canada and operate in every province of the country. The food distribution industry is Canada’s second largest commercial sector, comprised of 80,000 foodservice operators across the country. Member sales represent $12 billion in foodservice and employ over 428,000 Canadians and represent over 85% of all grocery (i.e. food, non-food, non-alcoholic beverages) distribution sales in Canada (Wilkes, 2008).

b)     Overview of company in Canada

Gordon Food Service (GFS) is a foodservice distributor based in Michigan, USA. GFS serves the eastern half of the United States and has multiple divisions all over Canada. Gordon Food Service was founded in 1897 and has over 19,000 employees. In 2016, they earned 12.9 billion USD. GFS is the twenty-sixth largest privately held company in the United States. In 1996, the company began a series of acquisitions in Canada, forming GFS Canada. The location I got into contact with is based at 2999 James Snow Parkway North in Milton, Ontario.

c)      Vision, mission, goals of company

At Gordon Food Service, Customer is King and our purpose is to serve our customers with the highest-quality food service products and services. To do this, Gordon Food Service is guided by hard work, innovation, compassion, spirit, integrity of our people and a deep commitment to what we call our “Cornerstone Values.” Cornerstone Values are the principles that guide every interaction, and how we evaluate our performance and measure our success.

2. Company Background:

a)     Approximate annual company sales in Canada

Gordon Food Service is a foodservice distributor based in Wyoming, Michigan. Current estimates show this company has an annual revenue of $13.7 billion (Forbes, 2018).

b)     Name the company’s major channels of distribution and name the major current customers in each channel

Producer

Certified Angus Beef, Harvest Valley, Intercity Custom Meats, Markon, Mosaic Café International, Pepper Mill, Sienna Bakery, Trade East Spices & Seasonings

Wholesaler

Gordon Food Service

Retailer

Red Lobster, Cineplex, Boston Pizza, Toppers Pizza, Booster Juice, Ikea

Consumer

End users, people that eat at the restaurants listed above

c)      Who do their customers sell to, if applicable? (Describe the final consumers as a target market re demographics and psychographics.)

Gordon Food Service sells to businesses in the food industry. Final end consumers are food lovers, food critics, regular customers that eat at these restaurant chains, people that celebrate birthdays or a special occasions and want to dine out. There is not really a certain demographic because kids, adults, and seniors all eat at restaurants. Certain restaurants bring higher end clientele (i.e. Red Lobster, Boston Pizza), whereas other restaurants are for more casual/everyday indulgences (i.e. Booster Juice, Pizza). 

d)     Describe the background and responsibilities of the salesperson you interviewed. Provide a job description and a sales organization chart.

Melissa Colling-McGrath is a Team Sales Representative for Gordon Food Service. Her position summary includes driving account profitability, supporting activities of her District Sales Representative, seeks growth opportunities in existing customers with knowledge and professionalism, strengthens customer relationships with GFS products and services for assigned territory and accounts, supports customers via telephone, email and Gordon Ordering, and promotes and utilize all e-commerce technologies.

Her core competencies include inspiring others to deliver a strong service orientation, delivering results on time and as expected following SMART objectives, delivering appropriate written and verbal communication to the District Sales Representative and District Sales Managers, taking personal responsibilities for growth and development, encouraging collaboration with others to achieve a common goal, and embraces and supports change.

Essential job functions include e-business implementation and training for reps and customer base, coordinate and order samples, initiate/coordinate broker/vendor/specialist visits through CRM, conduct and follow up with business reviews, identify customer penetration opportunities and suggest alternative brand offerings, solicit and enter orders including JIT as required, identify potential prospects and support the District Sales Representative when customer issues arise, sales reporting, support initiatives to plan, execute and succeed, ability to influence and direct the District Sales Representative and customer sales growth and activity.

e)     Describe company’s sales recruitment and training practices, as well as, the compensation structure for sales people (base salary, bonus, commission, car, expenses, benefits etc.)

At GFS they have multiple sales recruitment options, they have job openings through their website, Glassdoor, and Indeed. The company will also reach out to people they know and accept referrals. My sales representative was referred by a friend and then received an interview. New hires at GFS will receive all paperwork that states what they are supposed to do and a copy of the company’s policies and procedures. Training can be very difficult for someone who has not worked in a sales position before because there is a wide range of products that they need to learn. The main area of training is product knowledge and service knowledge. Ensuring that employees are comfortable with answering questions or concerns about the product or service before they can make a sale. As for the compensation structure, most sales positions have a base salary that range from $47,000 – $70,000 with benefits, vacation, and a work phone included. At GFS, they offer an excellent and competitive benefits package. Not only do sales representatives make a base salary rate, they are also rewarded through performance-based pay. Meaning, if GFS does well in profit, so do their employees.

3. Major Competitors for your Main Product:

a)     Identify your main product. If your chosen company has a broad line of products, select one specific major product for the balance of your report and role-play

GFS is a foodservice distributor. It has multiple product offerings and a wide array of food options such as quality meat, seafood, dairy, fresh produce, beverages, bakery, and tabletop/cleaning supplies. I am focused on selling the service through a consultative approach with value added services.

b)     Name top 5 direct competitors. Which competing products/services do they sell? Describe the top competing product in detail.

  1. Sysco Food service
  2. Summit Food service
  3. Wallace & Carey Food service
  4. Flanagan Food service
  5. Stewart Food service

All these distributors sell the same products: specialty meats, seafood, fruits, veggies, bakery, frozen foods, dairy, beverages, supplies and equipment, etc. Replicating products is simple and any distributor can do this. That is why making the service unique and adding value to the service is what makes all the difference in the success of GFS.

c)      Current market share of all direct competitors. Use graphics

Market Share of Competitors

 

d)     Identify any indirect competitors and explain impact on your business if applicable.

Indirect competitors of GFS would include local grocer’s such as Walmart, Superstore, Costco, No Frills, Metro, Food Basics, Loblaws, Sobeys, etc. When companies don’t order enough stock or GFS shortships items, companies may buy the same product at an alternative store for convenience purposes until the next delivery date. These grocer’s pose as an indirect competitor because even though they are not specifically distributing to companies, GFS still loses revenue to them.   

4. Your Main Product

a)     A description of your product/service in detail. Provide pictures. Why did you choose this as your “main product”?

Gordon Food Service is a leading food distribution company in North America. We deal with thousands of vendors on a regular basis to ensure we have all products available in our building for our customer needs. This can be very tricky as it needs to flow through the distribution channel seamlessly to get to our customers on time. Through delivery of products, receiving, warehousing, picking/selecting the correct products, purchasing and ordering the correct amount of each product, marketing,  choosing the correct products to house in our building, to customers ordering the correct product, customer service helps our customers through this process and sales ensuring we have the much needed customer base to ensure business success and growth. We need to ensure first and foremost that our customers feel like they are the most important part of our business. They are indeed, as without them we will not succeed.

At GFS one of our core values is “Customer is King” and we need to ensure this in each and every employee that devotes their time and energy to the success of our company and customers. Well rounded value add services keep customers and show that we are willing to go above and beyond for our customers. GFS offers night time deliveries to avoiding day time traffic, maximizing fuel, labour saving JIT program, online ordering, GFS connect, a mobile app, online payments, e-transfer, “where’s my truck” SMS messaging, etc. This is why businesses will choose us over other companies and we have seen major growth each and every year. We have finally become a billion dollar company at GFS Ontario alone in the last few years.

I chose to sell GFS Services because nowadays replicating products is simple and any distributor can do this. That is why making the service unique and adding value to the service is what makes all the difference in the success of the company.

b)     Its current “positioning” in the marketplace relative to competition. (Refer to your Marketing text to review the definition). Use positioning map.

GFS is higher in quality and higher in price than its competitors; GFS services all the Canadian provinces and over half of the United States. Whereas sysco is on an international basis supporting foreign distributors abroad.

c)      Identify the specific pricing strategy used for this product and compare the price point with each of the top 5 competitors. Use table format.

Due to food distribution varying by bulk sizes and transportation distances, price comparisons are not applicable. Also, in order to view price listings of products from competing companies, you must be an existing customer. Below is a sample of products offered from GFS. Unfortunately, I was unable to have access to other price lists.

d)     Table of 5 most important “FABs” for this one product/service. Do not use same benefit more than once. (See Selling text for examples)

Features

Advantages

Benefits

JIT program

less time in transit, less storage space needed, less waste produced

ensures to offer freshest products available resulting in higher food quality and building brand trust which one is the most valuable intangible assets in a business

Night time deliveries

Avoids high traffic, maximizes fuel

avoids delays, saves money by minimizing fuel usage and ultimately decreases the charges on the bill

Ordering online or on mobile app

on the go, anytime, anywhere, flexible ordering schedule, 24/7

fully integrated mobile app, improves the ordering process and seamlessly connects GFS to the retailer. This saves time by ordering anytime and on the move

Online payments/e-transfer

easily view invoices online, automatic payments

automatic payments are super convenient and requires no hassle at all. Online invoices and transactions also saves on paper wastage which cuts printing costs and ultimately is eco-friendly 

Where’s my truck

text message alert, estimated time arrival

relieves stress by not having to worry about where or when the delivery will arrive

e)     Now compare this table of “FABs” with either the market leader or the major competitor. Use table format. Identify if your company’s product has any major competitive advantages or distinguishing features.

 

                    Main Product:

 

              Gordon Food Service

 

                 Major Competitor:

 

               Summit Food Service

➔    Non-unionized

➔    JIT program

➔    Night time deliveries

➔    Online payments/e-transfer

    Advantage: Where’s my truck SMS

    Advantage: Mobile app ordering

➔    Unionized

➔    24 hour delivery

➔    Online ordering

➔    Online payments

➔    Flexible delivery times (customers can choose preferred delivery times)

    Advantage: Customer pick-ups (drop in for additional items, small orders)

f)       Four promotional strategies* (see text) used to sell to the BUSINESS buyers, incl: selling, advertising, sales promotions & public relations. How is each used by your company?

Selling: The GFS sales team will prepare a business pitch. They will set up meetings with potential partners and do a formal pitch. Businesses that want to partner with GFS can do so online by filling out a form.

Advertising: GFS does have a commercial for their grocery store that’s only available in America. They do not have locations in Canada, excluding distribution centres. They also offer flyers, exclusively to America, for their grocery stores as well.

Sales Promotions: GFS does offer sales in their grocery stores, contests to win prizes/money, surveys, email subscriptions, and product rebates.

 Public Relations: GFS manages their website which includes a blog. Available are tips on how to run a successful business, recipes, how food impacts health, and they have a loyalty program called Gordon GO exclusive only in America.  

g)     Describe the “selling tools” or methods that are typically used by the salesperson to present the product to potential customers. (You should use these in your role-play.)

GFS have recently taken a new approach to sales. The Consultative Approach is a selling method in which we spend most of the time with the customer to understand the problem the customer is trying to solve and then recommend a solution that will specifically address that problem. We are not only sales reps but sales consultants that can help our customers with every part of their business needs. Consultative selling techniques are all about the dialogue between the salesperson and the customer. In Solution-Based Selling and Needs-Based Selling, rather than just promoting an existing product, we focus on the customer’s wants/needs and then address the issue with appropriate offerings.

5. Buying Factors and Typical Objections

a)     What are the most important factors that business customers consider when they are buying this service from your company or its competitors?

Melissa explained the most important factor that business customers consider is the price of the products and service and how it will benefit them. As well as, her extensive knowledge, this shows she is well prepared and knows all aspects of the business. Business customers are also concerned about the ordering procedure, payment, price-point comparison to competitors, and if the value-added services are genuinely beneficial.

b)     Identify the top 3 typical challenges or objections for this product based on your salesman’s experience.

Melissa explains how customers first and foremost concern is pricing. How do the benefits outweigh the price? Next, is the ordering procedure and product availability. How to navigate through the site for efficiency? How can I guarantee I get the products that I order? And lastly, reliability on goods in transit. When will product be shipped? When can I expect delivery?

c)      Explain how he/she typically deals with the above objections. Be specific.

Melissa explains how pricing could be a bit higher than competitors but ensures the benefits are worth it. GFS offers so many convenient features that leaves businesses stress free. She ensures GFS has done all the work, so they don’t have to. By GFS handling all the small details businesses can focus on solely running their business.

Next, all companies have a customized order sheet. Therefore, the ordering procedure is seamless. With products only tailored to their company, they are not scrolling through endless pages and thousands of products. Businesses can also order online or from their mobile phone. This helps with efficiency and reduces ordering punch in errors. Product availability is not an issue as GFS Canada only has products from Canadian producers/farmers. Distances are not that far, and this keeps prices low.

Lastly, GFS offers a very reliable transit system. With more deliveries happening at night this reduces traffic and saves on fuel; another cost cutting factor. GFS offers next day shipping, so businesses can get their product within 2 days. They also have “Where’s my truck” SMS messaging which allows automated message updates on delivery ETA. It tells you an allotted time window, 30-minute alert, and arrival time.

d)     What kind of preplanning does your salesperson typically do to prepare for a meeting with a new prospect?

Melissa ensures she has extensive knowledge on GFS services and products. She also must ensure she knows who her competitors are, what they offer, how GFS is different, how they got to become a billion-dollar company. Melissa makes sure she listens to what businesses need and want. With the consultative approach, she needs to understand their expectations and what GFS can do to exceed them. She strongly focuses on catering to customers and makes them feel like they are a part of the GFS family. Melissa practices her sales pitch multiple times before meeting with the prospect so she knows exactly what to offer and be fully prepared for questions and concerns.

Appendix:

Bibliography:

Name of interviewee: – Team Sales Representative

October 1st, 2018 – Reached out for approval

October 3rd, 2018 – Face-to-face interview

October 4th, 2018 – Additional information through email

November 13th, 2018 – Additional information through phone call

November 21st, 2018 – Follow up

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