Mydin Expansion And Growth Strategy Analysis

Mydin Expansion And Growth Strategy AnalysisMydin Mohamed Holdings Bhd is a local produce line scheme in retail industry under the leadership of principal(prenominal) executive, Datuk amir Ali Mydin. The business starts its operation since 1957 in retail and sell. In the scotch environment, Mydin face challenge from other tell players such as Giant, Tesco, intersection and Econsave. Currently Mydin has 4 hyper markets and its total stores are 55 which located at Klang Valley, Terengganu, Kota Bharu, Seremban, Nilai, Johor, Alor Setar, Melaka, Penang, Pahang and Kelantan. To compete, the company plans to expand their business and wrench organically. Mydin imposed low determine strategies and leave alone economically price goods to its clients. Surely, the expansion and ontogeny leave alone decide the business objective. Below is the comparison data of retailers with its number of stores in Malaysia.retailerNumber of storesGiant.40(hypermarket/superstores)Total Giant sto res 100Tesco.35(hypermarket)Carrefour.23(hypermarket)Econsave.38(supermarket hypermarket)Mydin.4 hypermarkets.Total Mydin stores 55Hypermarket list is not exhaustive. dividing line Times , Saturday, July 31, 2010Therefore I would like to wonder whether Mydins expansions and harvest strategy is viable to the business to gain market parcel of land and emerge as market leader.RESEARCH BACKGROUND.This commentary will be based on these get hitched withing supporting documentsMYDIN EXPECTS 10pc RISE IN PROFIT,QA with Datuk Ameer Ali (Mydin)/SKORCAREERMydin to built its biggest hypermart in Kota Baru/Business Times.New logo,motto for Buy Malaysian discharge/mydin.com.myINTERNAL CENTRE OF LEADERSHIP(ICLIF)-2009/MYDIN CASE STUDY.Microsoft Supports Malaysian Retailers Aggressive Plans to Expend.Malaysia mulls bar-code system for halal, intersection points Business TimesMARKETING.Marketing Planning.As a retail company in Malaysia, Mydin had implement several merchandising planning to b oost their sales and obtaining larger market share. Therefore, this commentary will examine the marketing mix approached by Mydin to successfully market their product and formulate their marketing strategy. Therefore, Mydin crowd out moves towards fitting a market leader.Marketing mixProduct.Mydin has a wide scarper of product line such as food line, soft line, difficultline and household items. Due to the wide range of product, Mydin will benefits from larger customer base. This will give positive service to Mydin as its customer can obtain all products needed here at lower and cheapjacker price. As a local player, Mydin provide items that are complement with its customers need. Majority of Malaysian are Muslims. Therefore, Mydin provide local prayer mats, prayer garment for women and traditional product which are rarely found elsewhere. However, Mydin should consider its non-Muslim customers due to the propose of the stray where only Muslim shops.Place.Besides, Mydin is currently expending their business into antithetic format namely hypermarkets, emporium, and My Mart (24 hour convenience stores). As referred to growth of Mydins chain by the year 2009 to 2020, the business forecasted to have 26 Hypermarket, 60 Convenience Store, 20 Emporium and 5 My Mart1. This investment appeal the business a large amount of specie which is RM 200 jillion for supermarket and 60 million for the building of hypermarket2. The managing director tries to emulate the growth strategies of Kmart by having My Mart although Kmart vex bankruptcy. This expansion can help Mydin, reachable for its customers with various channel of distribution. For example, the choice to build the biggest hypermarket in Malaysia at Kota Baharu3is due to high demand and larger land available. However, Mydin should consider their large expansion as they whitethorn be affected by diseconomies of scale.Promotion.In terms of promotion Mydin apply me-to-promotion where Mydin follow and respon d to their rivals marketing strategies such as purchasing similar publicizing board and article from newspaper4. angiotensin converting enzyme of its outlets in Subang Jaya has a digital billboard, controlled digitally from its office. This provides fast response toward its rivals advertisement. Besides, Mydin should consider having other marketing strategies such as advertisement through website or radio to provide expand information and awareness of their existence.Price.Mydin is well-known for selling its product at wholesale price (40% of its business is wholesale). As compared to its rival, (Giant, Tesco and Carrefour) Mydin is a favorite place for shop especially in period of economic down turn. They gain RM 1.3 gazillion in 2009 from RM 1.1.in 20085. This proves that as Mydin grow organically, they gain strength in volume, thereof can sell cheaper as compared to its rivals. Therefore, the situation is inciting its marketing objective.Positioning.Market placement is cruc ial to portray a good integrated image and disunite Mydins product over rivals. The unique selling point (USP) of Mydin that makes the business digest out from others is the embracing the concept of proper (following the dietary law in Islam)6. As most Malaysian are Muslim and very special in Halal product, the USP is an added advantage.Mydin popular slogans Where everybody can buy7also provide a perception towards the customers that in retail industry, you can buy product cheaper at Mydin. But Mydin need to sustain the image by providing items cheap and not providing cheap items with low qualities. Mydin can perceive its brand to be a bargain brands (at high quality but with low price) although its hard to sustain. Therefore, with the growth and expansion strategies, Mydin is moving from prudence brands towards Bargain brands.8Quality gameyLowHighPremium brandsCowboy brandsLowBargain brandsEconomy brandsPriceFigure 1 Perception map showing family relationship between price a nd quality.The slogan is in line with governments campaign, Buy Malaysian9which educates Malaysian to buy local product (Mydin provide local product on its shelves). Mydins outlet at Subang Jaya has been chosen as the place for expounding attends by Prime Minister to launch the campaign10. Besides, Mydin together with Halal Development Council (HDC) organized Halal training program course for small- and medium-sized entrepreneurs (SMEs)11. The corporate social responsibilities (CSR) done by Mydin enhance its image and will disembowel customers to choose Mydin instead of others.OPERATION MANAGEMENT.Product Planning.As Mydin grow, the business may affected by overtrading due to stockpiling12. This situation can increment cost and later absorb on the price of product. Hence, Mydin decide on Microsoft Dynamics AX for Retail to applied Just-In-Time stock focussing13. The software provides information for its suppliers and decision-makers so that the distribution of stocks runs smoot hly from stores to supply chain14. By this, Mydin can be to a greater extent responsive to its customers, reduce their break-even point, and improve cash flow and the working capital cycle15. Consequently, provide competitive advantage towards its rival.HUMAN RESOURCES.Organizational Structure.Besides, Mydin interfere coordination problem of its managers as the business grow hierarchal taller and wider span of control. Communication across the organizational structure will become time consuming and in certain case may be distorted. To overcome this, Mydin decide on Microsoft Office SharePoint Server 200716that allows large information to be provided to all layer of the organization and its suppliers.Motivation.In enough a market leader, Mydin must have a productive employees to repay larger working capital.16.2% of its workers are foreigners and the remaining are locals17. To create ace of belonging to work and generate teambuilding between workers, the company provides financia l and stirred up support18. According to Maslows hierarchy of needs, people are motivated more than just money19. Mydin meets the social needs of its worker by conducting natal day parties, cultural dance and inter-branch sports.20CONCLUSION.Mydin has implemented huge expansion and organic growth of its company. They try to gain their market share by becoming more competitive toward its rival. In becoming so, a transformation throughout the organization is done. Based on the marketing planning carried out, Mydin is currently on the responsibility direction towards its corporate objectives. We can notice how Mydin develop strategic marketing mix to successfully market their product. However, there is some areas that should be modify and focus on. In terms of product, Mydin can try to attract non-Muslim customers by having a promotion or creating an image of Mydin as a place for anyone.Besides that Mydin has wide channel of distribution. However, Mydin should also consider dealing with diseconomies of scales. One of the choices is by introducing measures to remove productive inefficiencies. Mydin might count the effectiveness of each of the business format. The marketing strategies indicate that Mydin can gain higher market share from its competitive advantage in promotion and price.In view their product, Mydin had done it well through their USP, slogan and CSR played. They manage to give make it perception of the business to public. Hence, they can gain more customers in the future. In operation management and human resources, Mydin try to centralize their management to interrupt business runs at loss and to generate efficiencies. Their decision to cooperate with Microsoft Corp. is a right choice to place Mydin at top amongst other key players. Also, without neglecting its employees needs and demands.Overall, based on the analysis of marketing planning, operation management and human resource Mydin expansion and growth strategies is viable for the busine ss to be a market leader in retail industry.