Our Publix SWOT Analysis investigated the Strengths, Weaknesses, Opportunities and Threats of the retail company and its operations.
Imagine you just woke up and went to the kitchen to make breakfast, and that's when you realized you were out of groceries. In this case, what's the first place that comes to your mind when you think of doing groceries? It must be Publix.
Publix is one of the most accessible supermarkets for the residents of Florida. Around every corner, a Publix outlet provides you with all the products you would need. After every block or so, there is an outlet for Publix. This is what makes the supermarket chain so successful.
Today's article will all be about Publix and its operations because, in this article, we will be conducting a Publix SWOT Analysis. However, before conducting any brand's SWOT analysis, it is essential to have some know-how about the brand.
Jim Makos
To have a better understanding of Publix, let's have a look at the history of Publix. The traces of Publix can be traced back to 1930 when a guy named George Jenkins opened a food store named Publix in Florida.
People liked the building and the food store concept, which made Publix famous. After some time, the owner of Publix thought to further expand the operations by entering the supermarket industry. In the 1940s, Publix opened its first supermarket in Florida that was loved by customers.
At the end of the 1940s, the supermarket had expanded to 20 locations. As Publix entered the decade of the 1950s, it further expanded its operations. At that time, Publix decided to introduce Publix-branded products.
People liked the brand's merchandising idea, further strengthening Publix's expansion. By then, Publix had been spread to 55 locations within Florida.
Soon, the supermarket brand opened its 100th store and started paying attention to the outlook of the stores by placing neon lights that would glow at night. In 1972, Publix experienced innovation.
Publix became the first supermarket chain to replace keypunch registers with computerized scanners. By the end of the 1970s, Publix had established 231 stores and had hired 26,000 employees.
The decade of the 80s brought a lot for the supermarket chain. While celebrating its 50th anniversary, Publix decided to open a dairy plan and Publix pharmacy. By the end of that decade, Publix had established 367 stores which were operated with the help of 62,000 employees.
In 1991, Publix opened its first store across the state in Georgia. From there onwards, the supermarket brand kept expanding its operation to other states. In the 2000s, Publix showed a bit of diversity by opening a cooking school and a liquor store.
Later in 2010, Publix also opened stores offering organic and natural items. Currently, Publix has spread its operations in seven states of the US. It currently owns more than 1,200 stores with more than 220,000 employees.
Publix is a renowned brand in the US, and people find it very convenient to shop from there. Due to its popularity among customers, Publix managed to generate revenue of $48 billion in 2021.
Now that we have discussed Publix's history and current operations let's look at what SWOT analysis is. The SWOT analysis is a technique that enables us to highlight the strengths, weaknesses, opportunities, and threats faced by an organization from both internal and external environments.
A SWOT template is used to identify what factors impact an organization's operations.
In this article, we will carry out Publix's SWOT analysis to identify what are the internal and external factors that impact the operations of Publix.
Publix Strengths
Strengths are the strong points that a company possesses. A company should have more strengths than weaknesses if it wants to succeed. This section highlights some strengths Publix possesses and enables it to compete in the market.
Strong Geographical Presence
Brands that have more stores tend to generate higher revenue. This is why brands give great importance to geographical presence. Publix is one of the brands with a great geographical presence in the US.
As of today, Publix is present in 1,326 locations all over the US. It has the highest number of stores in Florida. Although its operations are only spread in 7 states of the US, the number of stores in these seven states accounts for a strong geographical presence.
High Revenue
The main purpose of doing business is to generate money. Therefore, every brand aims to generate maximum revenue. However, only some brands manage to generate as much as Publix. Although Publix is a supermarket chain, yet in 2021 it generated revenue of $48 billion in 2021.
Such high revenue provides financial security to the brand. Moreover, it provides an opportunity for Publix to innovate and spend money on R&D, which benefits the supermarket brand in the long term.
Good Reputation
Brands with a good reputation have a higher customer base, which helps the brand earn more profit. Companies try hard to earn a good reputation. However, it doesn't come overnight. Publix has been fortunate to have an excellent reputation in the market.
In 2010, Publix was mentioned in Fortune's top 100 best companies to work for. This improved the reputation of Publix in the market. As a result, more workers and customers get attracted to the brand.
Moreover, earlier, the brand was also mentioned in Forbes. This spread Publix's good reputation, which affected the brand's image positively and helped it build a good reputation.
Publix Weaknesses
Every company has some weaknesses which hinder the growth of the company. Weaknesses are the shortcomings companies possess that act as barriers to a company's growth. In this section, we will analyze some of the weaknesses possessed by Publix.
Lawsuits
Brands always avoid lawsuits because they are bad for the company's reputation. However, some brands are mostly involved in legal actions. Unfortunately, Publix is one of them.
Over the years, Publix has been involved in different lawsuits. Earlier Publix was sued upon the claims of gender discrimination. This impacted the reputation of Publix negatively and spread bad word of mouth about the company.
Recently, a lawsuit was filed against Publix, where the supermarket chain was accused of religious discrimination. As a result of this lawsuit, Publix had to pay the penalty for compensation. In addition, this claim affected the image of the brand negatively.
Large Workforce
A large workforce can be considered a strength since it helps the brand carry out operations efficiently. However, having a large workforce can also be a weakness for the brand since it adds to the operational cost of the business.
If we look at the workforce of Publix, the supermarket brand employs 232,000 employees. So naturally, having such a large workforce increases Publix's operational costs due to its decreased profit margins. Besides that, managing so many employees can be a problem.
Less Geographical Expansion
Once a brand gets established, its priority is to expand its operations in all directions. If we look at the operations of Publix, we can see the brand didn't try to expand internationally or even all over the US.
Although Publix is present at 1,326 locations, it is restricted to 7 states only. Publix didn't channel its success in Florida and six other states by expanding its operations internationally or across the US. If Publix had expanded geographically, it would have been generating more revenue than it is generating now.
Publix Opportunities
Opportunities are the chances present for any organization to grow in the future. Of course, these opportunities may come and go. However, it is essential for a brand that wants to succeed to avail of the opportunities timely. So let's look at what opportunities Publix has to grow.
International Expansion
Brands always try to expand their operations abroad because by doing so, the customer base of brands increases, and they can tap more markets. Publix was established more than 90 years ago. However, still, the supermarket brand hasn't expanded its operations abroad.
Publix has the opportunity to move abroad for the first time. By doing so, Publix can target new markets and new customers. This will increase Publix's revenue. Besides that, the supermarket brand can hire cheap labor in developing countries. This will lower the operational costs of Publix and broaden the brand's profit margins.
Diversification
It is essential for brands to diversify their operations and not stick to just one operation. Diversification helps brands to increase their revenue streams and increase their customer base. For example, Publix has been operating as a supermarket chain for decades. However, the brand has gained recognition and is set to diversify its operations.
Publix can enter the food and beverage industry by opening a restaurant. This will decrease the brand's reliance on the retailing industry and help Publix generate revenue from the food and beverage industry. In addition, by doing so, the customer base of Publix will increase, which will be beneficial for the brand.
E-Commerce
Since we live in the technological development era, we come across something that makes our lives easier every other day. For example, recently, eCommerce emerged, which changed the retail industry completely. E-commerce provides online platforms for retailers and consumers to carry out online trade.
Publix, one of the biggest retailers in the US, has an opportunity to make the most out of e-commerce by adopting it. This can lower the operational cost of Publix since it may close some physical supermarkets once it starts getting traffic online.
Publix Threats
Every organization faces different types of threats. These threats must be immediately countered before they affect the organization's operations negatively. In this last section of Publix's SWOT analysis, we will discuss what threats Publix faces from the external environment.
High Competition
Brands avoid competition because price wars and cut-throat competition leads to minimum profits. As a result, competition in each industry varies. However, great competition exists in the retailing industry due to the similarity of products offered by every brand.
Publix is a supermarket chain that operates in the retail industry. In this industry, great competition exists. Publix has to compete with well-established brands such as Kroger and Whole Foods Market. Publix must constantly innovate and provide customer incentives to protect its market share from such brands.
Global Recession
Recessions always bring great pain to businesses since they lower the buying power of people. As a result, the demand for products in the market falls. Due to the pandemic and the conflict between Russia and Ukraine, it is predicted that we are close to a global recession.
Publix, a supermarket brand, would really get affected if a recession arrives because the buying power of people would decrease due to the recession. As a result, the sales of Publix would fall, causing the revenue of Publix to fall.
Fewer Barriers to Entry
The barriers to entry are the barriers new entrants must go through to enter the market. Barriers in each industry vary. However, the barriers in the retail industry are pretty low. Any brand can enter the industry and steal other brands' market share and customers.
This poses a threat for Publix since new entrants keep joining the industry. This can decrease the market share of Publix in the future, which can make Publix suffer financially.
Final Thoughts on the Publix SWOT Analysis
Publix is a supermarket brand that operates in 7 states of the US. It is one of the most renowned supermarket brands in the US. This article sheds light on the history of Publix. First, we discussed how the supermarket chain got established in the early 1930s and evolved over the years.
After gaining enough understanding of the brand, we learned about SWOT analysis. We then proceeded further to carry out Publix SWOT Analysis. In today's SWOT analysis, we highlighted the internal and external factors that impact the operations of Publix. The results of this SWOT analysis can also be represented more efficiently through a SWOT Matrix or a SWOT table. Besides getting insight into Publix, this article shed light on how to conduct a SWOT analysis. To learn more, take a look at some more examples of SWOT analysis.
