Kudler Fine Foods is a Gourmet food store where one can buy all the freshest ingredients, and tools that a gourmet chef could want. Kathy Kudler, the President and owner of Kudler Fine Foods, wanted to provide an environment of convenience, and reasonable price. What started as a one store operation has grown to three stores within the San Diego area, with a fourth opening soon. Kudler is currently considering contracting with local growers of organic produce to enhance the produce options already in place at the store. This paper will explore the impacts this decision could have within the company.
Marketing strategies will need to be adjusted to include the addition of local organic produce offerings. This will be an increase to operating costs, especially upon initial launch of the offerings. Kudler will need to identify the local growers that will be approved for purchase from the stores.
Part of Kudler’s strategy for the upcoming year is to reduce cost to the customer. The locally grown, organic produce that Kathy Kudler is looking to introduce would actually add to the cost for these items. Organically grown produce is on average, higher than mass market growers, as they are able to produce, and therefore sell in bulk. This will have to be managed carefully to be sure that the company is able to meet their goals in the organic produce sales market.
The organizational structure of Kudler Fine Foods is such that allows for each store to independently determine and order their product needs for the upcoming period. In general, there is a list of approved vendors that the store managers are able to deal with. To include the local organic produce growers, which may vary from store to store, and to manage this list may be difficult. Without having the same inventory tracking, purchasing and potentially different vendors, the concern becomes the ability to trend store over store when they may be getting items from a different vendor at a...