Value Chain Analysis in Sainsbury: A Case Study

Business Environment -
Essay

Table of Contents
INTRODUCTION...........................................................................................................................3
Value Chain Model- ...................................................................................................................3
Sainsbury-...................................................................................................................................4
Internal Environment-.................................................................................................................5
Reflection on the Value Chain Model-.......................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES .............................................................................................................................10

INTRODUCTION
Value chain analysis is the procedure in which a company identifies its support and
primary activities that adds value to their final products and further these activities are helpful in
reducing cost or enhancing differentiation. It represents internal activities where a company
engaged in when the inputs and outputs are being transformed.
J Sainsbury Plc trade as Sainsbury it is the third biggest chain of supermarket in whole
United Kingdom. The company has market share of 15.3 % in supermarket share. The above
report includes description of value chain model. The brief overview of company and report ends
with the reflection on Value Chain Model.
MAIN BODY
Value Chain Model-
Value chain is also known as the Porter's Value Chain Analysis is the business
management concept which was formulated by Michael Porter. It is the model which helps for
analyzing specific activity by that company can develop competitive advantage and value for
them. It is the strategic tool that is used for analyzing companies internal activities. The main aim
of company is to recognize that activities that are most valuable for company and which can be
further improved for providing competitive advantage. The company which competes with
differentiation advantage they will better perform the activities as compare to their competitors.
Whereas if company competes by cost advantage, they will try to perform internal activities at
low costing than their competitors (Hernández and Pedersen, 2017). It represents all internal
activities company engaged for producing products and services. It is established by primary
activities which add value to finish product and support activity directly which add value
indirectly in it. Value is directly added by primary activities to production process, they are not
much important than support activities. Competitive advantage is derived from innovation or
improvement in technology in their business model or the process. Thus, this all support
activities such as 'research & development', 'information system' and 'general management'
which are usually most essential source of the differentiation advantages. The primary activity is
source of the cost advantages, where each and every activity is identified and properly managed
along with identification of cost for that as well. It is the formulation for breaking down business
function sequence into strategic relevant activities by which utility is to be added to goods and
services. The value chain analysis to be undertaken for understanding behavior of cost and