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Makro was a famous cash and carry store in the Philippines. It was a haven for imported foods and other products. But as time passed, Makro was quickly forgotten and people switch from them to other cash and carry stores and supermarkets like SM. SM Group bought and now hold 100 per cent of Makro in 2007 and all branch were converted as SM Hypermarkets. But there is one interesting branch of SMHypermarket that is situated in Mandaue–its distance to SM City Cebu is just a mere 1.1 kilometres. Why does SM need to maintain that outlet when people can go directly to SM City Cebu and with that, people who will be going to supermarket at the basement of SM City can be tempted to buy clothes, shoes, or watch movie? It can increase SM’s profit. What is the logic behind this?
One big reason for that is the diversification of SM. We all know that they love to invest in different kinds of business—from retail to housing. They want to capture a bigger market share in the supermarket business. The SM Hypermarket is like the AirPhilippines of Philippine Airlines. It also decongests the daily number of visitors going to SM City as it’s quite annoying for buyers to go in SM and see floods of people at every floor. Another reason why SM decided to rebrand MAKRO into SM Hypermarket and put it near SM City is because people have different buying patterns. It would be hassle-free for consumers if their only purpose is to go buy foods and other basic necessity goods rather than visiting SM City wherein they need to conquer plenty of mazes inside the mall before reaching the supermarket.
That is why SM maintained the former MAKRO because SM Hypermarket competes with outdoor markets like Carbon and not to compete with its sister chain. Most of its products are fresh meat, seafood, fruits, and vegetables. What’s different to Hypermarket to SM Supermarket andCarbon is they sell goods directly to the customers, who are hooked on the concept of choosing the items they want, at the quantities they prefer, and at the price they can afford. It also give buyers the convenience of a first-rate indoor wet market, food and general merchandise store to provide one-stop shopping convenience for shoppers everywhere.
One advantage of SM Hypermarket compare to SM Supermarket is some products are cheaper like fish which is P10-P20 cheaper than in SM City Cebu. They like to introduce new concepts to enhance the positive shopping experience in the stores: the chicken rotisserie stall, the bakery stall that sell thousands of freshly baked pan de sal and other types of bread daily, and Taste Asia, which offers dampa-style dining.
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