Reference no: EM133672115

Question

Goya Foods Inc. produces and markets Hispanic foods sold mainly through supermarkets throughout the U.S., especially those that serve markets with large Hispanic populations. The company, based in Secaucus, New Jersey, has enjoyed strong sales growth in recent years. What is so different about the way Goya sells its wide range of food products, such as Spanish olive oil, beans, Caribbean fruit juices, soft drinks and desserts, is the company strategy for using shelf space in supermarkets: Goya displays all of its diverse food products together in one section rather than by category of product as is done for most food producers. Goya does this because the food brokers it uses to get placement for its products in the supermarkets have learned by working closely with store managers that this all-in-one section approach is consistent with how consumers shop. Some observers believe that Goya's shelf strategy causes the company to lose the so-called crossover market. That is, customers who are shopping for a particular product will not have the opportunity to compare the Goya product to competitors' products. But Goya is sticking to its guns, arguing that its store-within-a-store strategy has worked so well that it has never had to pay slotting fees to keep its products on store shelves.

If many of Goya's products represent high quality and excellent value, as the company claims, wouldn't a strategy of spreading the products all over the supermarket open up more opportunity for sales growth than confining all of Goya's products to one place in the store? Discuss.