Strategic Analysis for Coles Supermarket
Upon the determination of the attractiveness of the company in subsequent years, internal strategic decisions are taken to promote the operations of the supermarket. The evaluation through the Porters Five Forces Model and the Value Chain Analysis have significantly pointed to the place of the supermarket in the industry. Through a determined policy framework, the examination yielded a set of recommendations that could be adopted to enhance its operations. Some of the policies suggested were intensifying advertisement as well as integrating technology into all its activities. Table of Contents Executive summary 2 1. Internal analysis of Coles Supermarkets 9 3. The value chain analysis 10 3. Inbound logistics: 10 3. Operations 10 3. Marketing and sales 11 3. The proprietor opined during the early stages of the establishment that a contented staff, happy home life is the key to success (Coles, 2018).
By 1935, the company was listed in the Stock exchange. The success during the period before World War II was attributed to high quality, improved service delivery and value system. Upon listing, the company became a retail industry leader through enhanced value assurance to its customers. Driven by the urge of establishing ‘tomorrow’s shops, today,’ in 1960, Coles opened the first freestanding supermarket that would stock every merchandise and equipped with a car pack. Some of which are undertaken through rolling out of new format stores, charging lower prices which are achieved through the Down Down campaign, as well as inspiring teams to serve with personality. Today, the company has diversified its product lines to include a supply of fresh agricultural foods.
Moreover, the company maintains a healthy relationship with suppliers which has seen the intensification of its operations (Kumar, 2008). External Analysis of the industry It is critical to observe that strategic decisions are made in response to common internal and external factor directly or indirectly impacting the business. The prevailing macro-environmental issues influence these factors. Porter’s Five Forces Model Porter’s model uses five factors to evaluate the market conditions. These factors include; a threat from substitutes, competition level, bargaining power of customers, the bargaining power of suppliers, and a threat of new entrants. These factors are discussed in the succeeding sections. Threat of entrant of new retailers The Australian retail industry presents a slow entry owing to the policies in place.
The trend is least expected to change in the future. com. au is intensively influencing customer preference for given supermarkets. Such factors are likely to increase customer power bargaining power. The bargaining power of suppliers Suppliers have low bargaining power in the industry. The dominance of Coles and Woolworth supermarkets leaves suppliers with limited intermediaries to select. The Coles Supermarkets faces threats from many convenience stores, farmer markets as well as grocery stores. Today, the convenience stores are serving many customers, which means mounting competition for the supermarket (Dixon, 2007). Moreover, the shifting preferences towards a more healthy and organic products have seen customers buying directly from the farmer’s markets. The implication of the tastes is deteriorating demand for supermarkets. Evaluation of attractiveness of the industry to Coles Based on Porter’s model, the sector presents both a threat and benefit for the company.
The strategic success of the company entirely depends on how well it will employ its resources (both technology and finances) to meet customer needs. The core competencies are the key issues that contribute to its competitiveness. Coles Supermarkets has effective supply chain system, brand reputation and active management (Pierson, 2018). Moreover, the strategic issues in the internal environment are addressed by promoting sustainable advantage and the value chain analysis 3. The value chain analysis The value chain system enables Coles Supermarket to create value for its products. Operations The main activities involved in operations are quality assessment and inventory management. Quality assessment refers to standardization procedures that are used in detecting defective products especially when the goods are in the store (Wright and John, 2003).
Usually, the evaluation will involve tracking if the commodities meet minimum specifications. Inventory management at the Coles requires the use of the Point of Sales (POS) to check on stock levels. Besides, other advanced stock forecasting techniques are used to determine any changes in demand for products. Consequently, it serves as a resource for the company. The supply chain perceptively saves costs which are crucial to promoting the company’s competitiveness. The supply chain of the Coles comprises highly integrated technological system which is suitable for the variety of commodities it trades. In a bid to enhance profits, the company relies on other factors to improve its competitiveness because, in isolation, the supply chain is usually characterized by inefficiencies. The positive brand reputation of the Coles Supermarkets has undergone a transition since the conception of the retailer.
The advertisement should focus on the available products as well as its objective of “Down Down, Prices are Down”. This way Coles will be able to expand its market dominance. Moreover, the brand advertisement will see sales rising because of the increased awareness (Pierson, 2018). The advertisement may be run on social media platforms where the audience is large. Intensify the use of technology in service delivery to the customer. The overall impact will be increased cost saving and customer satisfaction, which will be replicated in the income streams. Works cited Barratt, Mark. "Positioning the role of collaborative planning in grocery supply chains. " The International Journal of Logistics Management 14. Dixon, Jane. U. S. , 2018, https://www. reuters. com/article/wesfarmers-results/update-2-australia-wesfarmers-coles-spin-off-in-focus-after-tepid-supermarket-sales-growth-idUSL3N1S31I6.
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