INSTITUTE OF BANKING STUDIES GUILLERMO SUBERCASEAUX

MEMBERS:

Karla Concha.
Bernardo Montenegro.
•María Verastegui.

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INSTITUTE OF BANKING STUDIES GUILLERMO SUBERCASEAUX

INDEX

Introduction 3
Brief History 4
Misión y Visión---------------------------------------------------------------------- 5
SWOT 8
PORTER 9
-
Org chart 16
Tottus Hypermarkets 17
Tottus Locations 18
Tottus Competition 19
Problem 20
Solution 21
Flowchart 22
Additional Information 23
Market share 24

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INTRODUCTION

We have carried out this work on the company S.A.C.I. Falabella due to
To be one of the most successful Chilean economic groups, with greater
Presence outside the national territory and that shows a development
Sustained and growing in its activity in recent years, which is
It is extremely interesting to analyze its evolution.

On this occasion, we will analyze the Tottus supermarket.

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BRIEF HISTORY

Tottus is the hypermarket chain of the Chilean family of businesses.

Falabella, with presence in ChileyPeru. Although the company is of capital
Chileans, this is based in Peru where it was founded in2002This idea
it started as a way to break into the supermarket market
in Chile, when in the2004, Falabellahe/she bought the supermarket chain
San Francisco, at 62.5 million dollars, the growth projection was
capture 10 percent of the market in the medium term, from a base in
returns to 3%. The first Tottus hypermarket in Chile was inaugurated inBridge
High, Chilein December 2005, following the supermarket model
that the Solari and Del Río family has maintained in Peru since 2002, after
inaugurate the first Tottus Hypermarket in Mega Plaza, inIndependence,
Peruthat same year. The first Tottus supermarket in regions outside of
Santiago was built in the NewMall PlazaofAntofagastaand in the same
city inaugurated a second branch (this time in the center) during the
second semester of2007.

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MISSION: We work day by day to satisfy the consumption of the

homes of our clients, offering the best service
delivered by our work teams and the products
more convenient with the best quality.

VISION: To be the supermarket chain that consolidates development

harmonious of our work teams with our
clients, the community, and their environment-

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SWOT ANALYSIS

At this point, we will see the study of the SWOT analysis where
make an internal analysis and an external one.

The internal analysis allows for the identification of the strengths and weaknesses of the organization.

conducting a study that allows understanding the quantity and quality of resources
and processes that the organization has.
To carry out this analysis, different techniques must be applied that allow
identify within the organization which attributes allow it to generate a
competitive advantage over the rest of its competitors.

Internal analysis:

STRENGTHS:

They are the positive characteristics of a company and on which it is based.

has full control. These strengths are the pillars on which
supports the organization in achieving its objectives.
Among the strengths that Tottus highlights, we can mention the
next:

. Commercial Alliance with CMR

. Company known in the field.
. Continuous training of staff since
They always have to face new challenges.
. Use of private labels.
. Good image.
. Safe environment compared to the market.
. Schedules suitable for the availability of the clients.
. Wide geographic coverage in Chile.

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WEAKNESSES:

These are the negative characteristics on which control is exerted, in this

point out the deficiencies of the organization that are necessary to
overcome.

. Lack of positioning in the brand.

. Its organizational culture and concept of supermarket do not
has allowed him to have great acceptance.
. Low attendance.
. Internal operational problems.

External Analysis:

OPPORTUNITY:

They are positive conditions that provide the environment for the
organization, that can help achieve the objectives, however
There is no control over them.

. It is located in a commercial area.

. Enter new segments besides B and C
. Expansion of the product and service portfolio.
. Rapid market growth.
. Take advantage of the economic situation to pay off debts
earrings.

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THREATS:

They are negative factors for the organization, the same ones that prevent achievement.

of the objectives, they are also environmental factors that cannot be

make no changes, but if it happens, they can affect the operation of the
system and hinder the fulfillment of the mission.

. Competition, Santa Isabel, Leader, Jumbo.

. Competitors' innovations in service approach and
additional services. E.g.: Accumulate points.
. Deceleration of economic growth.
. Change in needs and tastes.
. Intensification of competition due to the arrival of large
foreign capitals in the coming years.

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Analysis according to Porter's 5 Forces model for Tottus

Clients

The customers of Tottus supermarkets in Chile are mainly

the citizens living in the areas close to such supermarkets. This
the first condition does not exclude audiences located in more remote areas. The
socioeconomic level is varied. In addition to the care of individuals,
There is also a service for legal entities. In summary, it is about audiences.
they value their time, safety, and comfort a lot.

ii. Suppliers

The main suppliers are:

§ Spring
VIP Water
§ Razzeto
§ Segoviana
San Fernando
§ M & J (Grocery Distributor)
Procter & Gamble
§ M. G. Rocsa S.A.
§ Megamarca (Glory)
Olaechea (Chifles)
§ Crickets
Swiss Chemistry (Distributor)
§ Icebox
Stereo (Pepsi)
§ Backus
Logistics Transport
Covi (Noodle Distributor)
§ Alicorp (Food Distributor)

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Deprodeca S.A.C. (Food Distributor)

§ Punto Blanco (Grocery Distributor)
§ D & R (Distribuidora de abarrotes)
§ Fruits and vegetables (Wholesale fruit and vegetable market)
§ D'onofrio
Lamborghini
§ A1 (jams, preserves)
§ Demakis (Grocery Distributor)
§ Alvarez Bohl (Grocery distributor)
§ Sodales (Grocery Distributor)

···················.

Some factors associated with the second force are:

• Facilities or costs for changing supplier.

• Degree of differentiation of the supplier's products.
• Presence of substitute products.
• Concentration of suppliers.
• Solidarity of employees (example: unions).
• Threat of forward vertical integration from suppliers.
• Backward vertical integration threat from competitors.
• Cost of supplier products in relation to the cost of
final product.*

·······························
iii. Competitors

Jumbo Supermarket

Company data
Jumbo supermarket is owned by CENCOSUD, a holding company managed by
Hurst Paulmann, which offers a wide variety of products at a high price
and excellent service. Their stores are large and most are

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located where large crowds gather. For this CENCOSUD

has opted to create malls with its three anchor stores: Easy (company
dedicated to construction), Almacenes París (retail) and Jumbo.

Jumbo is aimed at the upper stratum of society and is consolidating itself in the
online shopping.

Vision
To become established as a leader in service in the retail sector. Contributing
with the economic well-being of the region through the total satisfaction of its
clients.

Mission: "Our goal is for you to shop comfortably, in a

a cordial environment, surrounded by specially trained personnel to serve you and
provide excellent service at all times.

Principles

Punctuality at Work.
Cleaning and order.
Quality in customer service.
Mutual respect among workers.
Commitment and professional competitiveness continues.
Practice of ethics and values.

Products and services

Among the main types of products they offer to their customers, we can
mention essential products such as rice, milk, sugar, etc.;
meat products (chicken, beef, goat, pork, etc.), fruits and
vegetables, cold cuts, drinks of all kinds, sweets, and a wide variety of
spirits, among others. Regarding service, Jumbo is characterized by being

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one of the highest rated supermarkets in customer service and it is the

supermarket with less complaints.

It is worth mentioning that customers have a strong acceptance of the private label of
basic products.

However, among its limitations is the large infrastructure of each location.

It makes going to buy a few things an odyssey since they are so
large that you lose a lot of time in covering it, in addition to the little
economic to buy there.

Leader Supermarket

Leader is a chain ofsupermarketsehypermarkets, that belong to the

groupChilean-AmericanD&S Wal-mart.

The Líder brand was originally created in1995howEconomicsLeader, in the Local of

General Velásquez, commune ofCentral Station, as an extension of the
at that time existing Ekono stores, which were basically a large
warehouse with low-cost products given the purchase volume and the large
size of sales formats. Subsequently, the stores are inaugurated.
Puente Alto and Pajaritos in Maipú. The latter is the first to carry the brand.
Leader as such.

In1996D&S buys the Fullmarket hypermarkets and one of them is

converted to Leader format.

In the year2001Leader enters the eastern zone of Santiago with a new

concept of hypermarket focused on service and product variety.
This hypermarket is named Leader Market.

That same year, it converts the larger Ekono locations, but

lower than those of a traditional Leader, in Neighbor Leader. This is a format of
compact hypermarket with a smaller selection of general merchandise for

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compete in areas where the presence of a hypermarket is not justified

traditional (residential neighborhoods and small towns).

In2003Market Leader will now be simply called Leader, and the brands
Econoy Almac is now called Líder Express (currently Express de Líder).

Leader Formats

Hyper Leader
Logo of the Leader in the city ofTalca.

It is the hypermarket format of Líder. Initially, they were divided as Líder.

(most of the hypermarkets) and Neighbor Leader (some locations in
Santiago), but sinceOctoberof the2007, they merged both lines to call it
only Leader Hyper. It has a large sales space of about 10 thousand
m²with a wide variety of products in home, appliances, electronics,
textiles, hardware, and toys, in addition to traditional lines of
groceries, all with an economic proposal.

It focuses on emerging segments of the population that seek to satisfy

all your shopping needs in one place. It is the format
Hypermarketthe company's economy, and it has existed since1995.

Líder hypermarkets are characterized by occupying strategic locations in the

intersection of important roads, for having ample spaces for
parking lots, and because they are developed together with a series of stores
complementary services that offer various services such asvideo club, food
quick, dry cleaners, pharmaciesycinemas, among others.

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Leader's Express

Manuel Montt Expressway,Providence.

This format, initially called Líder Express, started in2003Starting from

Februaryof2007a format change was initiated that included the change of
Leader Express Leader Express, inaugurating the first location with
this format inThe Dehesa. Este cambio también afectará a algunos locales
Neighborhood Leader.1

Your sales room is approximately 1,500 square meters in size.

the sales assortment is around 12,000 products of which 95%
corresponds to food items, emphasizing the quality of perishablesfruits,
vegetables, charcuterieymeat) and the prepared food, with a lower
proportion of non-edible articles.

Ekono

This name was reborn from the ancient Ekono that was turned into 'LEADER'
"NEIGHBOR" which was later called "HYPER LEADER". Today the new
The format uses small stores, but with stock, these already in Santiago are 100.
locales. Their slogan is "ekono your super discount".

Their stores do not exceed 1,200 square meters, their assortment is

mostly edible, but other elements are being included for the
home.

This format addresses more essential purchasing needs (offers greater

comfort and less time spent in shopping) and allows to serve areas
geographical areas of smaller size where the Leader Hyper format is not a
option due to distance.

Super Grocery Account

This new warehouse format expands Líder's reach to other areas of

fewer resources, their assortment includes all kinds of products. Their sales room

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does not spend on stans rather maintains its format by saving on expenses of
service. Along with its opening, D&S launches its PRESTO A account card.

iv. Substitutes
wine cellars
-markets
free fairs

Potential entrants

Entering the supermarket business in our country depends on the

location and size of it, as this will determine the cost. In the neighborhoods
we can find medium-sized supermarkets such as
"Puerto Cristo" offers low prices but with a service that is not up to par.
better.

The Carrefour supermarket attempted to enter the Chilean market a few

years, but had a poor strategy and left the country.

Wal-Mart entered the country by buying Líder but its strategy is different from that of
Carrefour buys existing supermarkets and often does not change them.
its name to wall-mart because Líder is already established in the country.

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TOTTUS HYPERMARKETS

Regions:

• Tottus Antofagasta Center

• Tottus Plaza Antofagasta
• Tottus La Calera
• Tottus Quillota
• Tottus San Fernando
• Tottus San Antonio

Santiago

• Tottus San Bernardo Plaza

• Tottus Puente Alto 1
• Tottus Puente Alto 2
• Tottus La Florida
• Tottus El Bosque
• Tottus Nataniel
• Tottus Fontova
• Tottus Kennedy
• Tottus Colina
• Tottus Buin
• Tottus Plaza Alameda
• Tottus West Plaza
• Tottus Bridge

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TOTTUS LOCATIONS

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Competencies and Threats

FLO
PROBLEM

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Steps to follow if a customer complains about price differences:

1- customer arrives at the register and tells the cashier that they charged him for a product.

greater value than he had seen it in the room.

2- The cashier informs the customer that they must go to Customer Service to
that they see your claim.

The customer arrives at customer service with their receipt and explains their problem.
the person in charge.

4- The customer service representative tells the customer that she will address
the room personally with the ticket to verify its price difference.
5- After verifying the price in the room and seeing that the customer is in the
correct, the customer service manager must photocopy the receipt and
fill out the "refund voucher for price difference", which remains
registered the monetary difference that will be refunded to the customer.
6- The person in charge goes to the corresponding register to request from the
cashier the amount in cash that will be returned to the customer.
7- After having done this, the person in charge approaches the client and
deliver the cash.
The manager goes to the store administrator to request the
signature of said voucher so that it is known about the return.
9- The person in charge must go to the cashier who requested the money and
give him that voucher so that his cash register balances.

At the end of the day, the cashier must issue the 'refund voucher for the difference.'
of price" to the treasurer so that he can give him the amount of the voucher in

cash.
11- The treasurer must submit this voucher to her system, to a petty cash fund that
called "expense control" and has a monthly available amount
of $500,000.

SOLUTION

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The best solution to the previous problem is that it should be implemented a

department within the premises specifically aimed at changes
price updates.

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FLOWCHART

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INFORMACION ADICIONAL

After the merger proposalFalabellayD&Sthe chains Tottus and San

Francisco was at risk, due to the National Economic Prosecutor's Office,
in charge of monitoring mergers and acquisitions of companies in Chile, suggested
the sale byFalabellaof San Francisco Buin S.A. supermarkets,
What Tottus and San Francisco control in Chile, being among the interested parties.
Ripley CompaniesyThe PolarAll of this due to the fact that Chile would be in
a supermarket duopoly, given thatD&Shandles about 45% of
market withLeader Supermarketsand Leader Express,Falabellawith Tottus
and San Francisco is around 8% National andCencosudwith Santa Isabel and
Jumbo close to 33%, leaving the new company (FalabellaD&S) with
more than 50% national. The mega merger was rejected by the Court of the
Free Competition (TLC) in Chile, with this Falabella resumes its plans to
organic growth for Tottus, after coming in fourth place in the
Supermarket industry in Chile being surpassed by Rendic-Unimarc.

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