Let’s take a closer look at two popular retailers, BJ’s Wholesale Club, Inc. They are very different types of retailers, but we are still able to look them and compare their different and similar retailing strategies.
BJ’s is a leading warehouse retailer that first opened its doors in 1984. It has 144 store locations in 15 states on the east coast and also in Ohio. A wide variety of products are sold. The departments of BJ’s stores are comparable to Miejer’s or a Wal-Mart superstore, but with a much more limited selection of goods that are constantly changing. BJ’s appeals to two target market groups, families and businesses by “Provide[ing] our members with high quality merchandise at prices that are consistently lower than any competitive format.” Families are able to save money and also time with fewer trips to the store. Businesses are able to get the quantities of product needed at reasonable prices as compared to other channels of distribution.
Home Depot is the largest home improvement retailer in North America. It operates over 1,500 stores in 50 states, 13 provinces and Puerto Rico. Stores offer a very extended line of home improvement products at competitive prices, over 35,000 to be more precise. Home Depot considers do-it-yourselfers, as well as home improvement, construction and building maintenance professionals as its target market.
When looking at location considerations we can see that BJ’s and Home Depot have a few differences. BJ’s is able to locate stores a bit out of the customer’s way. Stores are usuallly located just outside shopping hubs, but because customers come for qauntity and value they are willing to accept the inconvenience of further distance or poor traffic patterns. This location strategy saves BJ’s money and time beacause the land is a little cheaper, and regulations may be less demanding. Home Depot on the other hand, needs locations that are more convenient for their customers, because while prices are competitive, they aren’t much lower so competition is much stronger.