Competitive Strategy 2022 Analysis

MANAGEMENT

COMPETITIVE STRATEGY 1
The process of summarizing, evaluating and analyzing the business environment of the
organization is called strategic management. It is essential for the organization to analysis the
macro or micro environment. There are various strategic tools in the organization to analyze the
business such as Resource Based View, PESTLE Analysis, SWOT Analysis, Value Chain
Analysis and the others. The company develops the strategy to achieve the objective in the
organization. It is required for the company to analyze the internal or external environment so
that the company develops the strategies to attain the higher level of success. The report is based
on strategic management tools of the business (Ansoff, Kipley, Lewis, Helm-Stevens, and
Ansoff, 2018). For the analysis, Woolworths has been taken into consideration to evaluate the
business environment. Although, there are numerous tools that an organization use to analyze the
factors that affects the growth but in this report, Porter’s Five Forces Framework, SWOT
Analysis, and Resource Based View will be discussed.
Woolworths is an Australian supermarket that offers the various services to consumer in store
chain. The company provides the all consumer goods to consumer. It has strong supply chain
network due to which it distribute the products or services in 100 stores across Australia. It has
been evaluated that the organization has 976 supermarkets within the convenience stores around
19. The stores are located in different locations with the similar logo of the company. The
company operates the business online with the name of “Home Shop” (Woolsworth, 2018a).
SWOT Analysis is a strategic framework that is used to evaluate the areas of strength,
weaknesses, opportunity and threat. It is a strategic tool which helps the organization to improve
the weakness by working on them so that the organization grabs the opportunity. This tool
examines the internal and external factors of the corporation. As per this tool, the areas have

COMPETITIVE STRATEGY 2
been identified such as weaknesses, opportunity, strength and threat due to which the
organization has can grasp the new opportunities by using their strength (Mind Tools, 2018a).
Strength: Strength defines the areas of capability of the company. In the case of Woolworths,
the main strength of the organization is its high brand image in the market. It has been evaluated
that the company also have high percentage of market share such as 34% in the grocery market
(Woolworths Group, 2018b).
Weaknesses: It refers to areas where the organization needs to improve. According to the
analysis of Woolworths, it is observed that the company has less presence in online market due
to which it is losing the large number of consumers. The other weakness of the company is its
price competition with its competitors as the similar companies offers the different prices to
consumers in order to attract them.
Opportunity: Opportunity refers the areas that the organization can grasp for future growth. In
the case of Woolworths, the organization has the opportunity to expand the business in online
market. It is observed that the organization can enter the new market with the merging or
acquisition methods as its financial position is better as compare to its competitors. The company
does not provide the credit services due to which the cash inflow and outflow is appropriate.
Threat: Threat states the risk that the company will face in future. Woolworths has high degree
of threat of competitors in the market as there are huge numbers of firms that provides the
similar services to consumers. It is also observed that the new entrants also has the chance to
enter the consumer goods industry as it requires less capital due to which the business has higher
degree of threat of new entrants.

COMPETITIVE STRATEGY 3
Resource Based View is a decision-making framework that is used to studies the strategic
resources of the organization. These strategic resources help the organization to attain the
competitive advantage in the market. It is a way to evaluating or analyzing the organization to
develop the strategies. This framework helps to make the resources different from the other
organization so that it can gain the competition. Resources defines the capabilities,
organizational processes, firm attributes, assets, human resources, information and knowledge.
There are certain resources in the organization that are able to being an input to creating strategy
to gain the competitive position in the market. The resource of the organization is classified into
four attributes that helps to gain the competitive position and these are valuable, rare, inimitable,
and Non-substitutable. It is observed that the combination of these four attributes is called VRIN
Framework. This framework or model is applied on Woolworths
Valuable: Valuable refers the resources those are able to bring value for the organization or to
assist to gain the advantage of competition (Jurevicious, 2013). In the case of Woolworths, the
local food products are considered as valuable resources as they are highly differentiated as
compare to the others. Human resources, patents, and distribution network of the organization
are the valuable resources for the company as it helps to take the competitive advantage.
Rare: The financial resources of the organization are considered as the rare product of
Woolworths. The high skills and trained employees, patents of the organization are not available
in the market that is why; these are called the rare products of the company (Woolworths Group,
2018c).
Inimitable: It refers the resources that cannot be copied by the competing organizations
(Rothaermel, 2015). It has been seen that the financial resources, distribution network and patent

COMPETITIVE STRATEGY 4
rights of the company are difficult to be copied by the competitive companies. It is observed that
these resources are difficult to be copied just because they require high cost to copy them.
Non-substitutable: It defines the resources that should not be able to replace with the other
resources of the competitors organization. The skills of employees, financial resources, patent
and supply chain network are not capable to replace the resources of the other company. These
resources are rare, valuable, difficult to inimitable that is why; these resources are difficult to
replace.
Porter’s Five Forces Frameworks is the strategic framework that is used to evaluate the structure
of industry. This framework is especially use to evaluate the competitive position of the
organization in the market. The main focus of this framework is on industry key drivers that help
to analyze the structure of industry and these are suppliers, buyers, entrants, competitors, and
substitutes (Mind Tools, 2018b). It helps the organization to develop the strategy by evaluated
the business environment.
The threat of new entrants: The degree of threat of new entrants is moderate as there is less
capital is required to enter the industry. It is observed that the existing companies also have high
brand value in the market that is why; it can be said that the new entrants require to enter the
industry with some unique techniques and technology.
The threat of competitors: It is observed that the threat of competitors is high as there are huge
numbers of companies who operate the business in similar industry. The main competitors of
Woolworths are Aldi, Coles and Wesfarmers. As the company has high risk of new entrants due
to which the threat of competitor is increasing for Woolworths.

COMPETITIVE STRATEGY 5
The threat of substitute: The degree of threat of substitute is moderate as there are no products
and services in the market that can substitute or replace the products of consumer goods. It is
observed that the organization deliver the consumer goods in the market.
Bargaining power of buyers: Bargaining power of buyers is high as there are great numbers of
businesses in the market. There are many companies in the market they supplies the similar
services to consumers due to which the consumers have many choices to buy the product from
the other companies as per the offers (Lasserre, 2017).
Bargaining power of suppliers: Bargaining power of suppliers is high in the grocery industry as
compare to the others. It is observed that the raw material of the consumer goods is available in
the market due to which there are huge numbers of suppliers in the market. The company has
many options to switch with the other suppliers due to which the switching cost is reduces
(Madsen, and Walker, 2015).
At the end, it is concluded that the process of strategic management is essential for the company
in order to examine the internal and external factors. The uses of strategic management tools are
required in the process of analysis. As per the analysis, the uses of strategic management models
are essential for the company while developing or implementing the strategies so that it can gain
the competitive advantage. It gains the competitive benefits in the market by evaluating the
competitive position with the help of strategic management model. The strategic management
tool is useful for the businesses to operate the business effectively and efficiently.

COMPETITIVE STRATEGY 6
References
Ansoff, H. I., Kipley, D., Lewis, A. O., Helm-Stevens, R., and Ansoff, R. (2018) Implanting
strategic management. Springer.
Jurevicious, O. (2013) Resource Based View. [online] Available from:
https://www.strategicmanagementinsight.com/topics/resource-based-view.html [Accessed
20/08/19].
Lasserre, P. (2017) Global strategic management. Macmillan International Higher
Education.
Madsen, T. L., and Walker, G. (2015) Modern competitive strategy. McGraw Hill.
Mind Tools. (2018a) SWOT Analysis. [online] Available from:
https://www.mindtools.com/pages/article/newTMC_05.htm [Accessed 20/08/19].
Mind Tools. (2018b) Porter's Five Forces. [online] Available from:
https://www.mindtools.com/pages/article/newTMC_08.htm
Rothaermel, F.T. (2015) Strategic management. McGraw-Hill Education.
Woolsworth. (2018a) About us. [online] Available from:
https://www.woolworthsgroup.com.au/page/about-us [Accessed 20/08/19]
Woolworths Group. (2018b) Woolworths Supermarkets. [online] Available from:
https://www.woolworthsgroup.com.au/page/about-us/our-brands/supermarkets/Woolworths
[Accessed 20/08/19].

COMPETITIVE STRATEGY 7
Woolworths Group. (2018c) Our Customers and Community. [online] Available from:
https://www.woolworthsgroup.com.au/page/community-and-responsibility/group-
responsibility/environment [Accessed 20/08/19].