Store24 summary

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					                                                                      Jennifer Smith
                                 Store 24 Case Summary

       Store24 is a privately held convenience store retailer in New England, the

4th largest in the region. Its stores are located across New England. The stores

are individually managed but homogenous in many aspects of their operations

including compensation, technology, management structure, and product pricing,

but they vary in size, geographic location, market demographics, and product

mix. Revenues totaled approximately $180 million in1998 (May 1, 1998 to April

30, 1999).

       Store24 adopted a "Ban Boredom" strategy in 1998 that focused on

providing an entertaining shopping atmosphere. “Ban Boredom” centered on a

large display case display that featured the promotional items for the current

theme. This strategy aimed to create a stronger sense of loyalty between

Store24 and its target customer base of young, urban adults between the ages of

14 and 29.

       Store24 abandoned the "Ban Boredom" strategy after two years based on

customer research, via a balanced score card, that showed customers identified

with Store24's traditional convenience-store strengths of fast and efficient service

rather than an entertaining shopping experience. The company quickly adopted a

new strategy, "'Cause You Just Can't Wait," which focused on speed and

efficiency. The theme refers to the stores’ ability to serve people quickly, to stock

the items or services needed and to present tasty high-quality foods in an

appealing environment.
       The Balanced Scorecard was used to measure Store24’s performance at

various levels of the organization throughout the year. Management collected

store-level financial performance metrics, including operating profit on a quarterly

basis, store manager and crew compensation, store-level profit and measures of

strategy implementation. The customer side looked at the likelihood of shopping

at Store24 rather than a competitor, name recognition of Store24 versus its

competitors, and for customers that have shopped at Store24 recently, items

such as quality of merchandise, price, and cleanliness of the store.

       The strategy for this was flawed in that it combined soft research with hard

financial facts tying customers to the corporate level. Although It is evident that

its not only the implementation but the overall strategy is weak, feedback showed

that customers were not identifying with the fun, enjoyable shopping experience

we were trying to create under Ban Boredom. Customers valued fast service and

good product selection. The strategy showed virtually no effect on profitability

across all stores. But the study also found that better execution of the "Ban

Boredom" strategy led to improved profitability in stores with more highly skilled

crews. Conversely, it found that better execution of the "Ban Boredom" strategy

led to declines in profitability at stores with lower skilled crews. For the "'Cause

You Just Can't Wait" strategy, better execution was associated with improved

profitability across all stores. This cause-and-effect analysis could be useful in

refining the strategy and considering whether employee skills should be

upgraded.