The Super Plus Story, The Good, The Bad and Lessons Learnt – Part 1

The recent news of the financial difficulties facing the Super Plus chain of supermarkets comes as no surprise to me as the signs have been evident for some time.  I would like to look at the Super Plus story in three articles, firstly what was done right, secondly what went wrong and finally what lessons should the financial sector take from Super Plus.

From my perspective the success of the Super Plus chain was built on three main factors.  The first factor was the recognition that many rural areas lacked a supermarket where one could go and buy all of the things that were needed; indeed most areas were still operating the concept of small shops where one can buy the basic items.  Super Plus recognizing the need set up supermarkets in many rural areas where there were no existing ones.  They later expanded the concept to the major urban areas.

Secondly, Super Plus paid attention to the need for providing excellent customer service.  One could always count on finding what you needed at Super Plus who often had items that no other supermarket carried.  When the time came to check out one could be sure that there would be sufficient cashiers to handle the customers.  I have experienced this service many times in the past and was always pleased with the staff at Super Plus.

The third and probably the most important factor was the fact that Super Plus had the lowest prices of all the supermarkets.  I can remember leaving the heart of Kingston and driving up to Stony Hill Square just so that I could take advantage of the lower prices that were there.  The savings more than compensated for the additional Gas that was used in driving to the location.

If you were to have done an informal survey of Super Plus stores five years ago you would have gotten the same response from everyone, Super Plus is the place to go for lowest prices, best quality and superior service.

So what went wrong? Look out for part 2 of this interesting series.

Feedback Question:  What has been your experience with Super Plus?

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14 Responses to “The Super Plus Story, The Good, The Bad and Lessons Learnt – Part 1”

  1. ghazwaz says:

    When your business is selling commodities be careful how near you go to politics and the people you hurt. Easy come easy go. Po!

  2. Ian says:

    I am not sure how the three factors you identified above are positive factors. Evidence in the US and UK has shown that large supermarket chains that emphasise low margins tend to undermine small family owned businesses and disrupt communities. Secondly, it is not true that superplus had the cheapest prices. My experience is that the notion that the prices at superplus were less than elsewhere was more a marketing myth than reality. Interstingly, the recent survey by the CAC confirms them as very pricey.

    What went wrong? You ar correct that we are largely a society of small shopkeepers and despite superplus’ best efforts the fact that we can go to our community shop and ‘trus” till pay day makes them far more attractive than the superpluses of this world. Look around where super plus is closing and see if you dont see small ventures still existing or in fact creeping up .

  3. Freespirit says:

    I actually never really frequented Super Plus much. Really sorry they are closing however.

    But I’m curious…do you think that some of the difficulties they now face is fallout from the Cash Plus debacle. After all there was rumour of a boycott because of their association with NCB (the supposed cause of the demise of Cash Plus).

    Would love to hear what others think.

  4. Steve says:

    It was a business model predicated on sustained economic growth. However from all indications, there was not enough market research done on the areas where they placed their stores. It is always nice to walk in get service when you the customer wants it. It is not a practical thing to have an overstaffed business. It is profits that creates solvency, not perception. All of the fluff they went with created excessive overheads which drove up their expenses and reduced their profits to zero. We are not even talking about other fixed costs such as utilities and fuel.

    The low price business model is one that relies on volume to sustain growth. If the population is not large enough or have enough disposable income to sustain this model then they were bound to operate below break even point.

    They should have made their stores smaller which leads to smaller, more manageable inventories. Low price business model is a recipe for failure in Jamaica particularly when you are operating with a local currency that is unstable.

    Good idea, just not good enough for areas with low population densities.

  5. Charlie says:

    The three points are excellent portals for any business to stand on. In fact the timing was right and it was an idea whose time had come. However did Superclubs anticipate the global financial crisis and make prudent moves to (a) set aside reserves, (b) renegociate with its banks and (c) avoid the trap of rapid expansion which would lend too much exposure to its accounts receivables. I am anxious to see your next article.

  6. Depressed Jamaican says:

    I don’t believe Super+ did anything wrong. Well if you take making an investment in a time when there is an unstable economy, and a government that played voodoo economics with the accounts of the country, then you can say they did that wrong.
    People just did not have money to patronize a relative modern supermarket chain. People were losing jobs right left and centre, so the market for foodstuff that would be normally consumed by working people, would have taken a big hit.
    I remember when i could shop in Super+ New Kingston, Half-way-tree and Cross Roads, but having lost my job through no fault of mine, I was unable to buy even the most basic stuff at those outlets.
    Super+ is merely a reflection of how badly the economy has been messed up and as a consequence the rapid failure of businesses.
    Where people have tried to point out where things went wrong for Jamaica and Jamaicans, others have defended, and refuse to acknowledge the serious mismanagement of a fragile economy.
    Super+ only mistake was to invest in a country where the management of the country was led by inept, ineffective and redundant kleptomaniacs.

  7. Gem says:

    When Super Plus opened on Trafalgar Road, I could have told them that they would not do well there. It was not a convenient location to do grocery shopping on a large scale.

    Whenever I stopped by there, the shoppers were mostly people who worked in the New Kingston area and came in on their lunch time to buy things like chewing gum, candy, sodas, etc. You hardly ever saw people with a trolley full of groceries as in other supermarkets. As a matter of fact, there were usually more Super Plus employees than shoppers.

    Their prices were not low either. Not to mention their big empty parking lot, and that’s valuable real estate in New Kingston.

  8. Delroy S. says:

    I noticed one, or two, interesting comments concerning the Super+ operation; however, from a business point of view, one should not believe every announcement to the media by a company.
    Therefore, without knowing the true reason behind closing some of their stores, a credible impression can not be determined.
    During some of my visits to Jamaica, I noticed
    that the Super+ Co. tent to over diversify.

  9. Delroy S. says:

    I noticed one, or two, interesting comments concerning the Super+ operation; however, from a business point of view, one should not believe every announcement to the media by a company.
    Therefore, without knowing the true reason behind closing some of their stores, a credible impression can not be determined.
    During some of my visits to Jamaica, I noticed
    that the Super+ Co. tends to over diversify.

  10. Clif says:

    A cause for more concern as now hundreds of Income tax paying Jamaicans now face the reality being out of jobs. Alot of whom are single mothers who aren’t really qualified for other fields not as if the job market is really booming. At times I wish that this whole global economic crisis is just a bad nightmare and Mom will wake me up for ice-cream or the like. However, this is not so the reality is that we need now more than ever to unite as a peopleand a region tighten our belts to face the possiblity of worst times yet to come.
    Additionally, I don’t think the current nor past administration that represent the people of Jamaica are at fault as they have inherited the socio-economic and social problems that our country face and these willnot be fixed overnight nor within this generation.
    Honestly, superplus is just a mere sad
    reflection of our country’s economic status, very sad.
    Hanging on Clif.

  11. Concerned says:

    I believe thatMr Wayne Chen’s comments during the Cash Plus debacle contributed to his demise. Depositors made a concerted effort to boycot the supermarkets. Why then is it that every where that a Super+ store was established that those supermarkets close by are still standing.

  12. Angela says:

    I think the Super+ stores as the writer said, in the early days was good – things were cheap, etc. but after a while you found that things were not “cheap” any more. In fact the little corner shop was selling much cheaper. So no wonder they had to close. Customer service also went out the window.

  13. terri-claude anglin says:

    i have hear all the comment that are made but in my view it was just some bad decision made by the power that be some store that were open should have never been open they cost millions of dollars and they never really materialize financially a lack of vision i guess they were on top so they took thing for granted but as the proverb says a hearty spirit goes before a fall

  14. ED says:

    Nice blog post – I found your site through Google.

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admin Posted by: admin April 16, 2009 at 3:25 pm