Piggly Wiggly Business Analysis

Introduction Piggly Wiggly has been known to many as the hometown grocery store since its debut in Tennessee back in 1916 (Piggly Wiggly, 2011). Clarence Saunders, the founder of Piggly Wiggly, developed a grocery store that was considered to be self sufficient and was considered the “first” for many of the things that patrons consider norms at any given grocery store now days. What patrons want the most from their shopping experience, though, isn’t the idea of supporting the small town grocer that paved the way for what is out there today. They want a store that is reliable, accessible, and affordable, regardless of what name is on the front of the building. This is one of the many reasons that the small business of about 600 stores across …show more content…
Greenbax Enterprise Inc. is the parent company that holds ownership of these 19 grocery stores and a number of other business related assets such as real estate ventures and ownership interests in a water bottling company. Greenbax Enterprise conducted an independent investigation in 2012 when they hired an investment banker to assist in evaluating future plans for the company (Darlington, 2014). During this investigation, Greenbax Enterprise was given the feedback that it should dissolve as a company and liquidate its business all assets. The decision was made due to a number of growing issues within the company and the majority of these issues stemmed from not being able to keep up with “deep pocketed rivals” (Darlington, …show more content…
Many of these stores had opened early on in small, undeveloped areas. But, as these areas started to increase in their development, larger more attractive businesses frequented the areas and affected the monopoly power that this small town business once had. The decline in sales took a hard knock on the economic profits of the company and shifted the demand curve to an unsettling low. Greenbax Enterprise was not able to keep up with the technology, low rates, and appeal that these larger, wealthier grocer businesses had coming into the market (Springer, 2014). Greenbax Enterprise is still a profitable company that brings in a net total of 6.1 million dollars a year after all expenses are paid, resulting in the accounting profits for the company (Darlinger, 2014). However, just the sale of the Wholesale Company would bring in 9.3 million dollars with the sale of all 19 stores and remaining assets to bring in much more (Springer, 2014). In 2011, 22 stores were sold across South Carolina and Georgia for a total of 35 million dollars, meaning if the sales were on par with these sales from a year prior then Greenbax would see a profit margin of 30.4 million dollars in a single transaction (Wise, 2013). This lump sum transaction would be the equivalent of 5 years worth of profits for Greenbax