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Case Study: Moving into the decade of the 2020s, Kevin Murphy reflected back over his two years as president of Publix Super Markets, Inc. Sales and profits had maintained their positive trend, established long before Murphy’s presidency, and comparable store sales continued to increase, despite the chain’s expansion of the number of stores. Publix continued to enjoy excellent publicity and a great corporate image, both internally and externally: it had been on Fortune’s 100 Best Companies to Work For, and Publix’s voluntary turnover rate was 5 percent, versus the industry average of 65 percent. The company was the largest employee-owned company in the United States and had never laid off an employee in its 89-year history.Although fiscal 2019 had shown net sales of a record $38.1 billion (an increase of 5.6 percent over fiscal 2018), and net earnings of over $3 billion, or 7.9 percent of sales, Mr. Murphy was concerned about the future. The grocery industry appeared to be moving rapidly from the traditional in-person shopping experience in which the shopper visited a favorite grocery and personally chose the week’s grocery items, to e-commerce with home delivery, or phone app-ordered pickup based shopping. Technology had provided the means for shoppers to select their grocery items from an app on their phones, and delivery and logistics improvements enabled quick delivery of the grocery basket to the shoppers’ door. Mr. Murphy believed that Amazon’s purchase of Whole Foods was a likely catalyst to cause faster than normal industry change in ecommerce grocery sales and delivery. Evolving lifestyles had resulted in a decreasing amount of food cooked at home, and an increased focus on sustainability, health, and natural organic foods. A new and powerful force that Murphy thought capable of causing significant and lasting industry effects was the COVID-19 pandemic sweepin

g the country. Cost control remained a major key to success, and private brands had emerged as a practical means of keeping costs low.Murphy was concerned that the rapid change in the supermarket industry was of sufficient magnitude to cause a major disruption in Publix’s positive trajectory if the company did not accurately identify the driving forces in the industry, and forecast and stay ahead of the industry’s path. He resolved to accurately assess the supermarket industry and keep Publix at its forefront.
History of Publix Super MarketsThe history of Publix began with its founder George Jenkins beginning his retail career in his father’s general store in Harris, Georgia. In 1925, Jenkins decided that Florida’s real estate boom offered better opportunities, and he moved to Tampa, Florida. Rather than working in the real estate industry, Jenkins took a job as a stock clerk in a Piggle Wiggly store. After two months, he was promoted to store manager, and a short time later, was transferred to Winter Haven, Florida, to manage the chain’s largest store. Jenkins held the management position at Winter Haven from 1926 to 1930. In 1930 he resigned from Piggly Wiggly and opened his own grocery store in Winter Haven and opened a second in 1935.page C-199 Jenkins closed his first two stores, and opened his dream store, the first Publix Super Market, in November 1940. The Publix was a “food palace” of marble, stucco and glass, and included innovations such as fluorescent lighting, air conditioning, electric eye doors, and terrazzo floors at a time when these items were considered luxuries not found in competing grocery stores. He acquired a warehouse and 19 All American stores from the Lakeland Grocery Company in 1945 and began replacing the small stores with larger supermarkets. He continued his aggressive expansion and brought the Publix brand to customers throughout Florida.