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Research On Management At Pak N Save New Zealand Business Essay

Paper Type: Free Essay Subject: Business
Wordcount: 3022 words Published: 1st Jan 2015

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The main purpose of the research report on PaknSave Group is that it is the demand of the subject. It will help us to gain vast knowledge about this particular organization. As well as we also come to know that what are the necessities and responsibilities to run a business. We will also get an Analysis of the Organization and Management in PaknSave Group. In this research report mainly we come to know the purpose of organization and roles of the management regarding that particular organization. We will understand the various management philosophies, management practices, influences of environment (internal and external) and application of change management theories.

Paknsave is a New Zealand discount supermarket chain owned by the Foodstuffs cooperative.

Founded in 1985, Pak’nSave was the last of the five current major New Zealand supermarkets (Countdown, Food town, New World, Pak’nSave, and Woolworths) to be founded. As of December 2009, there are 45 Pak’nSave stores operating across the North and South Islands of New Zealand.

Pak’nSave’s key policy is to provide everyday food and groceries at low prices. Stores are large and have a no-frills environment, often with unlined interiors and concrete floors. Customers are also asked to pack their own bags, and charged for plastic bags in most stores.

Source (http://en.wikipedia.org/wiki/Pak’n_Save)

Every day paknsave group aim to make a difference to people’s lives by making the desirable affordable. paknsave group will continue to make

Clear improvements in product quality and choice for our customers but, at the same time, paknsave group will always remain true to our core value proposition of delivering bargain prices.

The organizational structures of Pak’n save


In organizational structure of Pak’n save there is interaction model. There is chief executive, foreign divisions and coordinator of SP at the top level. At the middle there is director of admin and HR and chief operator and chief finance officer who control operations of company. Then there are general managers in each department. At the below level there is team members and factory managers. Due to transaction model the bottom level people cannot share their information and problems directly with the top level employees. For example if Gen managers in operation want to share some information’s of below level they will talk to chief operations officer. He cannot speak to C.E.O directly. There are four departments in Pak’n save the admin and HR department, operations department, and consulting and finance department. Below it there are senior and assistant managers. Below it there is team leaders and workers. This is centralized organization everyone has to report to the head office online. If there is any information then head office provides to every store. It is a formal organization. All the operations like timing, relate to stoke, sales and customer services control by head office. Every employee has to work according to company’s rules and regulations. Store managers cannot change anything related to their stores by themselves.

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Purpose of pak’n save

The name probably originates from the cost-saving practice of requiring that customers pack their own groceries. Pak n Save provides the cardboard boxes used for shipping products to the store, or plastic supermarket bags can be purchased at the checkout for 10 cents at North Island stores. South Island stores charge customers 5 cents per plastic bag. Customers are encouraged to purchase longer-lasting bags or to bring their own.

The stores are laid out as supermarket aisles, but with minimalistic design. Extra products that are not on shelves are stacked above the shelves on the pallets they were delivered in. This means that the floor space can be used for retail and storage. The stores are supplied daily from their co-operative distributor Foodstuffs.

Pak n Save stores often buy stock in bulk. This process means that stores don’t offer a wide variety of products as full-service supermarkets – a Consumer magazine survey noticed this especially in the pet food and toilet paper categories

Some stores have self checkout self scanning facilities, where the customer scans each item as they put it in their shopping cart trolley. This reduces waiting time at the checkout, as payment is the only thing that occurs (apart from random re-scans). Conventional checkout operator scanning is also available.

Pak’n save management roles and skills

PAK’nSAVE follows a Food format unique to New Zealand supermarket shopping. They buy and stock a range of everyday basic products in bulk, and because we can do this in such large volumes it means that they can pass the savings on to customers, in the form of New Zealand’s lowest overall food prices.

Customers will always find great specials in store – they pride themselves on getting the best deals by taking advantage of opportunities to negotiate in the marketplace.

They are also working hard every day to reduce costs in store – so customers will find that their plain style stores have no fancy floor coverings, extravagant shelving or expensive lighting.

In pak’nsave, they offer a practical and functional environment with wide aisles, where the grocery items are stacked on the shelf in their boxes so that it’s easy to shop, and there are lots of checkouts to get customers on their way as quickly as possible. Pak’n save company does ask customers to pack customer’s own groceries, as they know that customers don’t want to pay for any extras hidden in the price of the goods.

Because pak’n save reduce their costs by these methods, they can pass the savings directly on to clients, without reducing the quality of the products what they offer. Customers only need to check out pak’n save’s fresh food departments to find great quality fruit and vegetables, meat, seafood, deli and bakery items, all at competitively low prices.

For your convenience, some PAK’nSAVE stores have fuel pumps located on-site. When you buy groceries at these stores you receive discounts on every liter of fuel that you purchase from PAK’nSAVE Fuel.

The value of your discount is tied to the amount you spend in store – so the more you spend, the more you save! At the moment, PAK’nSAVE Fuel is only available at the following stores in the region: Botany Downs, Manukau,, Pukekohe and Lincoln North.

Problems faced by paknsave and their solutions

Paknsave has to face 2 types problems:-

Structured :- Those problems which have already decided or definite solution is known as structured problems. For e.g. the problems regarding customer complaints and reduction in product rates already have some solutions.

Unstructured: – Those problems which have an uncertainty and no definite format for the solution is known as unstructured problems. For e.g competition of market


Pak’n Save’s main competitors are stores owned by Progressive Enterprises, a division of Australian company Woolworths Limited. The main competitor is full-service discount chain Countdown, and to a lesser extent, Food town and Woolworths. Pak’n Save also faces a small amount of competition from Foodstuffs’ full-service supermarket, New World.

Problems are as followings-


Customer complaints.

Damaged products.

Arrange products according to customer needs.

More staff required during busy period.


The first problem that organization is facing is that tax is increased so that firm is found very hard to keep its promise of lowest prices.

This company is not selling all the food products that we need.

People can see many things have charges which are lower than Pak’n save products. People find some goods have lower find nearby small shops.

How organization might make decisions.

‘Brainstorming’ is a method of extracting a large number of ideas within a formal setting.The key features are as follows-

All the staff is drawn from the team.There is a chairperson and a note maker who makes the note of the whole ideas given.

Management Philosophies and practices of Pak’nsave groups:

Task focus: Various tasks- The management has various tasks to focus on. The Management needs to decide that what tasks needs to be done in between a specific period of time. This helps the management o make easy to achieve the goal. It also helps the management to make follow on the rules and policies.

People: Recruitment training performance appraisal- It all includes the hiring of new staff. This all can be known as recruitment. Some people on job give more preference in building relations with other workers or people but some people gives more preference to achieving the targets and goals of the company.

People orientation

(Relationship with people)

Task orientation

(Target achievement)

Efficiency and effectiveness: The main factors on which the efficiency and effectiveness of the paknsave depends are as following:

Location: The location of a paknsave plays a very important role in its efficiency. It should be situated on well localized place. So that people have not to face any type of problem while reaching there.

Workforce: Most of the success of any business depends upon the workforce of the organization that how effective all the workers do their work at their positions. Same things implement here in paknsave group.

Quality of products: If the quality of products in the paknsave would be admirable then everybody try to get stuff from here.

Impact of internal and external environment:

Internal environment’s influences:

People:Customer satisfaction: All profits of a company/organization depend on the satisfaction of customers. If customers will be satisfied with the products of the company then it will enhance the sales and if sales will increase then it will also raise productivity as well as as employment. Eventually profit will automatically increased by these factors, same thing implement on Paknsave group.

System:Quality: customer will only feel satisfied if the quality of the product will be reasonable. So this is also a core factors for the success of Paknsave group.

People:Staff turnover: it is also a countable factor for the development of business. If this problem occurs in Paknsave group then it will lead this business to loss of productivity, as new staff will take some time to get up to speed, particularly in complex jobs. As well as customer dissatisfaction will also occur.

The influence of PESTEL forces on Pak’n save

Economic effect

1) Food stuffs in New Zealand’s largest retail organisation and the second largest commercial organisation by revenue in New Zealand. Due to recession they are still employed employing more than 30,000 people nationwide. But due to recession it is going to be reducing in future.

2) Due to inflation because inflation is increased there is effect on consumer goods. So the prices is going to be increased but Pak’nsave prices is still lower than other retail stores .But due to great effect of inflation on the food products ,now Pak’nsave is going to lose their customers too.

Environmental effects

Pak’n save constantly strive to serve the community better. It understand the needs of our customers, and are big supporters of their local communities through various environmental and community initiatives.

1.) Foodstuffs South Island is very disappointed to advise that due to the severe nature of the damage which has resulted from the earthquake, New World Kakapo will not be re-opening and will need to be re-built. Understandably, this is an incredibly distressing time for the local owners,

2) Andrew and Jacqui Palmer, and their staff. The supermarket currently has 34 full time and 52 part time staff employed who will all be affected.

3) After the earthquake in Christchurch Pak’n save reduces their prices more than before but government is not going to reduce its taxes so they have to reduce their profit. But it is just for short time.

4) They said if NZ government reduces tax on consumer goods then they can be able to give extra advantages to people about quality and price.

Technological effect

The new $70 million Foodstuffs Wellington dry grocery distribution centre in Palmerton North is a smart operation that makes clever use of next-generation computer technology.

By online shopping customers use to buy things .By using these technology sales of Pak’n save is increasing. Now people do not have need to go out .they can give order for things online. Now Pak’n save delivers goods at their customers’ home. That is way customers can save their fuel and time.

Now new machine of packaging are established .So people can pack their own things very quickly and efficiently.

Its automated system for handling small grocery items has already doubled productivity in what has traditionally been the most time-consuming operation of Foodstuffs’ warehousing.

Operations Group General Manager David Cooper says the distribution centre, which began operating in January, has been designed to meet the current demands and future expansion of Foodstuffs Wellington Cooperative Society.

The distribution centre on the corner of Roberts Line and Railway Road is huge. People are dwarfed by the size of the place which is the largest in Palmerton North and one of the biggest in the country south of Auckland.

Inside the building, the feature that rivets the eye is the huge complex that dominates the central area. This is Foodstuffs’ automated picking system (APS). The 10-metre tall, steel lattice storage system for loose groceries is a computer-operated machine that was designed and installed by Australasian logistics solutions company, Dalmatic.

High speed “intelligent” cranes are installed between each row of racks and they zoom in and out at high speed. They pick up totes from conveyor belts to store them and retrieve others for delivery to work stations.

Legal influence

By increasing the GST tax by 15% Pak’nSave has to increase its price rate in future. But Pak’n save has to lose its customer. But Pak’nsave is not going to increase its price. It has to reduce its profit.

Government also provide subsidy to some food products It will enjoy by people and services is provided by Pak’n save.

Socio-cultural Effect

With changes of life style of people, people want products with cleanness. Pac’s save provided products with cleanness and also provided wholesale prices .so people like to buy more products from that place.

Pak’s save also changes its infrastructure and interior decoration according to customers .So that customers can visit more to Pak’ n save.

Generally people spend more on Christmas days .So Pak’nsave also provides saving accounts offers to their customers so that customers can save more two months before for their shopping at Pak’ n save account. By this Pak’nsave will be going to open a account of their customers So that they can buy more at less money.

Pak’nsave brands have been designed and developed over the years to best meet our customers’ various needs – whether it’s for the week’s big shop At PAK’nSAVE; shopping for that special dinner party at New World, or picking up essentials from your local, neighbourhood Four Square store.

Source (


Application of change management frameworks:

Mostly these retail industries hire those workers who are inexperienced and not have enough skills to work in this particular job which create problems while dealing with customers. So, it should be change. Before hiring any worker a test or interview should be must.

In accordance with Levin’s theory an organization has to overcome 3 stages of change which are:

1. Unfreezing

2. Change

3. Refreezing


While making this change firstly paknsave has to stop following old procedures regarding recruitment procedures. In next step they should start new training programmers so that they can make their work more efficient and applicable. In the last step warehouse will have to apply this change on the company. (Mind Tools, 2007; Syque, 2007)

In accordance with Kotter’s Eight Step Model an organization has to overcome 8 steps which are:


The main reason of this change regarding recruitment procedure is that it is affecting the sales and profit of the paknsave because it doesn’t have effective workers. For setting new rules and regulations a team is must which involves those workers who can plan and set these goals effectively. Then this team should set some goals for the better future of the company. Afterwards, this change should be tell to the all workers so that they can understand the need of change and follow the vision which is set up by team. After that the team should be given the authority to implement this change on paknsave. A short term survey is must so that they can know the output of the company after the implementation of new procedure. At last this change should made permanent if it works efficiently(Chapman, 2006).


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