Analyzing Competitive Forces in the Food Retailing Industry

Business Environment
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Running Head: Report
Table of Contents
1. Introduction............................................................................................................................2
2. Business Environment............................................................................................................3
2.1 Analyse the competitive forces in the food retailing industry.........................................3
2.2 Explanation of the competition in food retailing which exists on Mill Road and in the
ARU in Cambridge................................................................................................................5
3. Strategic Resources & Capabilities........................................................................................5
3.1 Comparison between the resources and capabilities of the independent food shops near
the ARU Campus in Cambridge and in the Mill Road..........................................................5
3.2 Usage of the VRIN model................................................................................................7
4. Stakeholders.........................................................................................................................12
4.1 Prepare a stakeholder analysis for the Cambridgeshire Fire and Rescue Service..........12
4.2 Identify two or three stakeholder relationships you consider are particularly important
for the service.......................................................................................................................17
5. Business and Corporate Strategies.......................................................................................18
5.1 Analyse the change in the scope of Sainsbury’s as a corporate entity...........................18
5.2 Assess the motivation for this acquisition......................................................................18
6. Conclusion............................................................................................................................19
References................................................................................................................................20
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Running Head: Report
1. Introduction
The main motive and the objective of the study is to describe the condition of the external
market scenario of the food industry in the United Kingdom. In the first part of the study, the
competitive forces of the large organization or the small business corporations have been
described. In this study, the Tesco and the Sainsbury Plc have been taken as the two
organizations of the food retailing industry of the United Kingdom. Moreover, the
competition in the Mill Road and in the ARU campus of the Cambridge have been discussed
with the help of the table. A VRIN analysis also has been presented for representing the
competition between the chosen organizations with the other large companies and the small
food retailing organizations of the United Kingdom (Apăvăloaie 2014).
In the latter part of the study, a stakeholder analysis has been developed and represented in
the study for the Cambridgeshire Fire and Rescue Service. Along with the core preparation of
the stakeholder's analysis, the relationships among the stakeholders has also been described
for the Cambridgeshire Fire and Rescue Service. Moreover, there are some of the
recommendations that have also been given for the managers to maintain the long term
relationships with the managers.
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Running Head: Report
2. Business Environment
2.1 Analyse the competitive forces in the food retailing industry
In this section the competitive forces in the food retailing industry of the United Kingdom has
been discussed. Among the small independents and the large organizations of the retailing
industry, the Sainsbury PLC and the Tesco are one of the largest organizations of the country
and the core competitive forces of the industry has been determined with the help of the
Porter's five forces analysis.
Threats from the new entrants in the market: In case of the new entrants in the retailing
market of the United Kingdom, it can be further observed that there are many prominent
countries in the country and they have exceeded the market barriers in the recent years. Thus,
due to this particular reasons, the existing market giants have discouraged the new entrants
for entering into the retailing market of the country. On the other hand, it can be noticed that
the presence of the Tesco and the Sainsbury Plc has reduced the ratio and the percentage of
the new market entry of the retailing organization in the United Kingdom (Bah and Fang
2015).
Threats of the substitutes: In case of the threats of the substitutes, it can be further observed
that the percentage of the threat is considerably high as there are many large companies as
well as the small organizations are present in the retailing industry. It can be noted that in
case of the large organizations like Tesco and the Sainsbury Plc, the threats of the substitutes
is much low as they offer unique products to the customers and in a diverse price range.
However in case of the small organizations in the retailing industry, the threats of the
substitutes is considerably high as they offer same kind of product in inferior quality and in
the low price at the same point of time (Botha et al. 2014).
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Running Head: Report
Bargaining power of the suppliers: Considering the large organizations as well as the small
independent companies of the retailing industry of the United Kingdom, it can be observed
that the bargaining power of the suppliers is high as there is many organizations in the market
and they offer different price quotations from different business corporations (Law et al.
2015).
Bargaining power of the buyers: In the retailing industry of the United Kingdom, the
bargaining power of the buyers is considerably high as the buyers or the consumers of the
market has the option to shift from one store to another store if they will not feel happy with
the product and the price quotations of one organization (Menychtas et al. 2014).
Competitive Rivalry: In the retailing industry of the United Kingdom, it can be further
observed that the competitive rivalry within the large organizations like Tesco and the
Sainsbury Plc is considerably high. On the other hand, it can be further observed that the
competitive rivalry within the small independent companies of the country is considerably
low in the present external market scenario.
Figure 1: Porter's Five Forces of the food retailing organizations in United Kingdom
(Sources: Chenchehene and Mensah 2015)
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Running Head: Report
2.2 Explanation of the competition in food retailing which exists on Mill Road and in the
ARU in Cambridge
It can be further opted that there is a high competition of the food institutions or the
organizations present in the Mill Road and in the ARU in Cambridge. There are two retailing
supermarket stores of Tesco and Sainsbury Plc in the Mill Road and in the ARU in
Cambridge and that is why there have been a sheer competition between these two
organizations. It can be further observed that in the Tesco supermarket store in the Mill road,
the customer attraction is more because in that area, many new people are the regular buyers
and they get attracted to the quality of products and services delivered by Tesco (Moroni et
al. 2015). On the other hand, the Sainsbury Plc has also increased their volume of customers
by 2.3 per cent within one fiscal year, whereas Tesco Plc has increased their customer base
by 3.9 per cent from the supermarket located in the Mill road. It can be further recognized
that the Sainsbury Plc supermarket in the ARU in Cambridge has mainly attracted the
teenagers and the college students by keeping a variety of goods and services of their choice
(Cheung 2014).
3. Strategic Resources & Capabilities
3.1 Comparison between the resources and capabilities of the independent food shops
near the ARU Campus in Cambridge and in the Mill Road
It has been discussed earlier that in the ARU Campus in Cambridge, the supermarket food
store of the Sainsbury Plc is located and near the Mill Road, the supermarket of the Tesco has
been located. A brief comparison on their internal resources and capabilities have been
described in the table below
Features Tesco Sainsbury Plc
Products and Services The Tesco has been one of The Sainsbury Plc has been
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