MGT4023 Strategic Management

Introduction: 

The aim of the report is to provide an insight into strategic management of the retail industry with specific reference to Woolworths Supermarkets (woolworthsgroup.com.au, 2018). It is a chain of grocery stores in Australia owned by the Woolworths Limited that represents a compilation of chains, brands and divisions. Woolworths Limited had its inception in the year 1924 under the name ‘Wallworths Bazaar Ltd’ that was an internationally acclaimed play in the name of F.W. Woolworth. Later on, the company was renamed Woolworths Limited.  The increase in the number of branches of the company across Australia led to the growth of the customer interest.

Woolworths primarily sold grocery items that included fruit, vegetables, packaged food and meat. Besides, the company also sold DVDs, magazines, beauty and health products, stationary items, baby and pet supplies and household products. The supermarket chain now has close to 1000 stores across Australia. Woolworths in fact represents the largest retailers of food in Australia. The target market of Woolworth represents the high-income groups with a living standard measure between eight and ten. The retailer also plans targeting two other market groups that includes the group with lower measure of living standard and the increasing middle class black population.

Macro Environment Analysis of Retail Industry

Political: 

The political situation helps in shaping the business environment of the retail industry (Bason, 2018). The industry experiences growth when there is political stability and the trading partners and the foreign investors’ shows immense interest in carrying business and activities related to business. Political disturbance however discourages business in entering the market. Since, Woolworths operates in a stable market so there are lesser chances of experiencing business loss.

Economic:

The financial crisis at the global level had serious impacts on the financial aspects of retail business (Shin, 2014). The financial crisis had a major impact on the total sales of the retail industry. However, the retail industry of Australia maintained greater stability and thereby supported Woolworth to continue with the business despite suffering a setback in UK market.

Social: 

The customers act as the vital revenue source of the retail industry and hence the identification of their needs ensures sustained profitability (Juan Ding et al., 2014). In this aspect, Woolworths recognized the significance of customer experience and introduced necessary means for need fulfillment thereby emphasizing the aspect of the customer delight that increases the profitability and sales.

Technological:

Introduction of newer forms of technology like usage of Radio-frequency identification (RFID) and the integrated service oriented architecture enhances the customer shopping experience in a retail outlet. Woolworths in order to gain a stronger market position adopted self-service checkout (Dunn, 2018).

Environmental: 

The environmental friendly practice that reduces environmental harm has a positive impact on the retail industry (Ferguson & Souza, 2016). Woolworths being a part of the retail sector not only ensures minimizing carbon footprint, ensures reduction of natural resource like water and undertake recycling activities.

Legal: 

The policies of taxation and the regulations of employee and recruitment management represent one of the key frameworks of legal aspects for the retail sector. Besides, requirements of food licensing also holds importance in this sector (Charlebois et al., 2014). Woolworths abides by all the legal policies while opening newer outlets.

Conclusion: 

To conclude, one can say that Woolworths has a remarkable business strategy that helps it analyzing the various external factors. From, the macro analysis it is visible that the retailer makes use of every opportunity in determining its future growth.

References: 

Bason, C. (2018). Leading public sector innovation: Co-creating for a better society. Policy Press.

Charlebois, S., Sterling, B., Haratifar, S., & Naing, S. K. (2014). Comparison of global food traceability regulations and requirements. Comprehensive Reviews in Food Science and Food Safety, 13(5), 1104-1123.

Dunn, M. (2018). New technology from Aussie company will make it impossible to steal from self-serve checkouts. [online] Available at: https://www.news.com.au/technology/innovation/inventions/new-technology-from-aussie-company-will-make-it-impossible-to-steal-from-selfserve-checkouts/news-story/dd4ed934c1d17242bfd09bc3c4a7624c [Accessed 2 Aug. 2018].

Ferguson, M. E., & Souza, G. C. (Eds.). (2016). Closed-loop supply chains: new developments to improve the sustainability of business practices. CRC Press.

Juan Ding, M., Jie, F., A. Parton, K., & J. Matanda, M. (2014). Relationships between quality of information sharing and supply chain food quality in the Australian beef processing industry. The international journal of logistics management, 25(1), 85-108.

Shin, H. S. (2014). The second phase of global liquidity and its impact on emerging economies. In Volatile Capital Flows in Korea (pp. 247-257). Palgrave Macmillan, New York.

woolworthsgroup.com.au. (2018). Retrieved from https://www.woolworthsgroup.com.au/page/about-us/our-brands/supermarkets/Woolworths