Business Strategy: Analysis and Strategies for Sainsbury
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This report provides an analysis of the business strategy of Sainsbury, a leading food retailer in the UK. It includes a company overview, PESTLE analysis, stakeholder analysis, VRIO analysis, SWOT analysis, and more. The report also discusses the competitive moves and strategies of Sainsbury in the UK market.
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Contents INTRODUCTION...........................................................................................................................4 MAIN BODY..................................................................................................................................4 Task 1...............................................................................................................................................4 Company overview......................................................................................................................4 PESTLE Analysis........................................................................................................................5 Stakeholder analysis....................................................................................................................7 Task 2...............................................................................................................................................7 VRIO............................................................................................................................................7 SWOT analysis............................................................................................................................9 Task 3.............................................................................................................................................10 Porters five forces......................................................................................................................10 Task................................................................................................................................................11 Strategic plan.............................................................................................................................11 CONCLUSION..............................................................................................................................14 REFERENCES..............................................................................................................................14
INTRODUCTION Business strategy is the respective course of action for the companies to have the achievement of specific business objectives in perfect manner.In addition, business strategy considered the competitive moves to have specific customer interaction in strengthening the performance and organizational goal achievement (Nandonde, 2019). Sainsbury is the leading food retailers in UK by owing more than 800 stores in term of supermarkets and convenience store. The company is in the retrieving positions for expansion in global market share. In this report there will be clear discussion of their external ad internal analysis by the understanding the business activities and different business strategies. In addition to that’s the report will deal with competitor’s analysis by concluding the different activities and strategies which is order to be more competitive in market. MAIN BODY Task 1 Company overview Sainsbury is the leading food retailers in the UK by the owning more than 800 stores which have the clear inclusion of the supermarkets and convenience store by having the 16.3% of the share in market. The largest level of shareholders with using the facilities, transportations. The firm have the clear level of aims of the reducing the carbon emission despite the growing in the super market space. On the other hand, the firm have been criticised for the links in between with government and related promotion of genetic engineering, excessive transportation of products, promoting intensive farming, paying producers low prices, and undermining small businesses. Vision The firm have vision to be art of most retailers where the people have love to work and shop. This is about harnessing the talents with creativity and diversity in order to ensure the customer for receiving the greater services every time. Mission The firm have the mission to be the consumer first choice for the food in way of delivering the products with outstanding quality and greater services at the competitive post through working faster, simple and together. Value and Culture 4
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Sainsbury have the culture to be heart of everything which have inclusion of team working together, bring new ideas with the best experience for customer and colleagues which the inclusive environments that values community. PESTLE Analysis The firm is the largest level of supermarket chains which is being established 150 years who have sought their tough level of competitions with other brands which is leading Tesco a close level of comparison in perfect manner (Hayes, 2018). The firm have the needs to pay close level of competition for immediate the business environments which might the affecting the internal operations.In order to have the identify the potential impact by reviewing the Political, Economic, Sociocultural, Technological, Legal, and Environmental factors affecting a business. Political factors The biggest level of political factor which is affecting the Sainsbury with imminent Brexit which evitable have increase the product pricing of the respective brands. Hence there is the large numbers in order to loss of competitors by providing the cheaper wholesale alternatives. This have the Particular effects in Brexit which cannot to be gauged with expected the lead to adverse condition in brand.As due to the significant change in the policies due to the COVID 19 , the companies have the to maintain the proper measure as per the government measure in order to run the company which is creating the negative impact.Another level of relationship between Qatar and England in the near future. The largest level of shareholders of the company is Sovereign Wealth Fund of Qatar with any political feud for two nations to lead the drop market shares Sainsbury. Economic factors The firm have the highly dependent which is road-based transport in order to ship its products all across the UK. The issues are mean to the loss of lower incomes to have brand giving the look the version level of alternatives the to primary the economic factors which is affecting the firm. There is the high wage movement which is gaining more level of momentum to expected the demand of workers in order to retain the shareholders (Bentham, 2018). Brands such as Asda and Tesco have been old rivals of the company and newer ones such as Lidl and Aldi are proving to be a source of added competition in the current market.On the other hand at economic levels the cost have been increased due to the social distancing and safety measure to have the protection of employees.There is the weaker sale of the sales of fuel, general merchandise and clothing, 5
and lower financial services profitability despite surging grocery trade as the coronavirus pandemic takes hold. Sociocultural factors The people of the UK have the major shift towards the health-conscious level of diet to stay relevant current level of socio culture climates. So, the brand has the need to have change in the fast food menu by indulging the healthier options such as the salads and organic shakes. The next is changing behaviour as company is catering the fair level of trade movement as the products such as the chocolate and coffee which is affected the fair-trade movements in more ways t meeting the customer demands in behaviour.On the other have the firm have the case modelling assumes to for the lock down restrictionuntil the end of June that there business to have the working in continuations to be disrupted until mid-September Technological factors Sainsbury’s eCommerce store is considered to be highly catering the current level of tech friendly level of generations so the brand can have improvement to provide customer better level of experience. This modern data analytical systems such as big data and AI understand the demographical needs of the consumers to cater them. These is more analytical methods which helps to have the increasing the sales and run better level of marketing campaign. Legal factors These have the different layer in the decision making in order to have ensuring the systematic changes by delayed business structure. This have the changing needs customer base to meet the specific demands.Due to he COVIDimpact Sainsbury's has opted not to take up use the government's furlough scheme or delay making VAT paymentsAs per the continues change is demand of customers in regulatory to get regulatory approvals loss in market share to have the provingthebetterexperiencetocustomer(Naharandet.al.,2018).Therearethelegal ramifications which is ready to face by running the outlets by outside the economic and political sphere in Britain. Environmental factors The firm have the production in high level of carbon footprint which is adverse current environmentalcondition.Thereisthecurrent climatechangefor movementto gaining momentum to take active level of steps to curb the environment impact. So, the firm have the clear level of aims of the reducing the carbon emission despite the growing in the super market 6
space. This also added the pressures to make quick changes climate oriented needs to meet customer demands by catering the environment impact. 7
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Stakeholder analysis An organizationhave the stakeholders as the group have involvementswhere the different which have the informing of all the level of operational activitiesas the covering the log term strategywhich have the proper level of conveying the quality, worth and serviceswhich have lead to the good level of earningand sale of the per year development (Chenand et.al.,2019). So, the stakeholder sure such as Suppliers-as the firm have the supplier from Britain and international levels which have believingthesourcingwithintegritybyformingeffectivepartnershipandraisingthe environmental and social standards. The firm tends to provide the ethical training initiative with commitment to customers by adding more value. Managers- it is the ones who have managing the vision and goals of owners as the current level of growth rate which related to ability of company to the different level of harness for human and material as the needed to growth the team in perfect manner. They sit over the affairs on Sainsbury and make sure the shareholders have dividends annually Staff-There is financial level of dependence for the Sainsbury for more level of sustaining the growth of living.This is best to continues to meet the organization strategic goals to create more job training and training to its staff. On the other hand the company have the increase level of the cost in term of the maintaining the socials distancing and proper sanitation of the product and campus Customer-There is very important for the end users to have the online purchases for customer the for cutting the across the border in order to get good quality at fair level of price. Community– The economic situations is challenging with major economic impact to succeed the conditions. The firm have the local charity scheme to have supporting the local community to have completive advantage (Vargas-Hernández and Garcia, 2019). The firm have the providing the greater service quality, quality products to support the local charities. Task 2 8
VRIO The firm VRIO analysis which have the showing of the research and development inis not considered to valuable as theresearch and development if considered to be more costing the benefits by providing the sense of innovation. Sainsbury is the firm which tends to highly operating in the retail market which holds in the disproportionate amount of the power. The firm tends to have the sharing of second level of market share as gracing tough level of competition from the Tesco. The firm have the merges’ ASDA as holding company by providing the accurate level of service to the customer at arcuate level. The firm have the proper level of allocation of ware houses by deploying major level of activities through different resources to have the completion of the customer respective orders (Yudhistira,., 2016). these resources have been considered to have the high level of stimulation of the queen with version level of action in perfect manner. Valuable- the firm is seeking about to have the differentiations in the strategies to gains more level of competitive advantage which have the allowing them to have the production in democratise designing.There is production of effecting quality of foods with perfect branding which will be sustainable available at lower prices. Rare- in the competitive market, the firm is trying to have the innovation of the products in order to generate more level of product definition to take the customer enjoy the customer services on the other hand , it tends to have the finding out the variable level of combination of the Sainsbury products. Imitability there is more level of experience the right level of combination in terms of business skills tones of application in way of providing the training and development of the staff members in more towards the applicability if corporate culture. This have eventually led to make the immediate the way in longer term. Organization The firm have been recognized in the respective market for the longer period f times by making strong level of presences to make the firm more level of successful in different countries. In addition to that’s the firm have been established as leading food retailers in the UK by the owningmorethan800storeswhichhavetheclearinclusionofthesupermarketsand convenience store by having the 16.3% of the share in market (Lewis, 2017). The largest level of 9
shareholders with using the facilities, transportations. The firm have the clear level of aims of the reducing the carbon emission despite the growing in the super market space. SWOT analysis Strength The firm have the right expansion moves to have brad expanded convenience stores with dealing the merchandise the categorise delay to days need of customers with super market brands. The firm have the business philosophy for following a staining the low-cost strategy for product categories by attracting and retaining customers for income segment as brand loyal. There is the opportunity to have catering all types of customers with catering the economy segment. There are expensive products as well as speciality products with higher segments in income. The wholesale and retail banking to be the unrelated level of sector which is being followed the competitors to helped out the diversifying the risk across diverse sector. Innovation promotion strategies as brand are highly innovative which is against the competitors as the brand options to competing brands which indicated to be cheapest. Weakness Brandswitchinghavealsofacingthelotofriskformloyaltyprogrammesand promotions. The firm have the still level of finding the challenging in more retaining the customers. The low margins with growing the completion for the retail spaces for added risk in online retailers have the lost level of volume (Lüttgens, and Diener, 2016). The firm have been trying the cut down the level of cost well as to keep the recipes lowers which are low level of sustainability. Growing cost with procurement cost by having eh shopping experience with key level of differentiate for high income segment. There is technologies have support the self-services which is basic level of pre requite as well as spacious aisles, multilevel parking, educated and well-informed salespeople etc. each of which is an added expense. 10
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Threat The firm is facing the fierce level of coemption form the big player in the market such as Tesco, ASDA, Morrison’s, Lidl, Aldi etc. In addition to that’s Aldi and Lidl are changing the rules of the game as theboth the discounters are providing the customerswith as assurance quality of products at the lower prices. Opportunities Growth in villages are gonging the days where the rural areas which is using the branded products.Today the branded products which have the all daily categories which is even villages which have rustle n the growth of supermarkets culture have remoting it into villages for the respective opportunity for the retailers. In addition to that’s farm have the opportunity to expand in their emerging market such as China, India, Russia, Turkey, Brazil and others is also worth exploring. Task 3 Porters five forces Porters five forces have the strategic management toolsin order to have analysing the industry to have the understanding the level of profitabilityto makes the five competitive forces which have influenceprofitabilityon order to have development of the strategy for enhancing the competitive advantage for long term of profitability in retail industry. Threat of New Entrants As the new entrants in more way of retailing the innovations which bring the innovations by the new ways of doing the things by pouting the pressure on Sainsbury through the development of the lower pricing strategy, reducing threats and providing the new level of value propositions to the respective customer (Bıçakcıoğlu, Theoharakis, and Tanyeri, 2019). There is collocal level of knowledge with extreme crucial food retail sector with difficult foreign firm to replicate. Bargaining Power of Suppliers This is more complicated as the it is difficulty to categorise which is mutually the dependent level of relationship as suppliers for itself huge companies. On the other hand, 11
there is huge brand appeal to do not sell the products will shift level of loyalties making the suppliers more powerful. The relationship have the changing the depending on different situations as big brand level of suppliers to be successful through the campaigning as the sale level of volumes for the dependence of the different level of supermarket. Bargaining Power of Buyers The power of buyer is higher which the industry to simplify for the presence of the competitors by selling the same level of products (Chen, Eshleman. and Soileau, 2017). It is more level to be differentiated in terms of process and the level of customer loyalty by increasing the green level of credentials. Hence, the switching cost is low for the consumers as the economy have been the further level of recessions as the consumer needs to be likely given more weight increasing the power considerably. Threat of Substitute Products or Services The threat is low as the consumer view re necessity with developing world by increasing the emerging the markets which is trying to the converge with innovation to make the shopping experience more extremely pleasurable.This make people to have difficult to substitute as the internal industry which can one laps up the business and other respective supermarket. Rivalry Among Existing Firms The retail market is considered to very crowded as trying to more level of getting int there non-food sectors which is further level of intensifying the competitions. Sainsbury’s has a market share of 14.9%, steadily increasing since its restructuring programme. This have been recognized the level of positive trends as well it as lags the runaway the market leaders b covering the considerable level of distance. Tesco, Asda, and Morrison’s are the other three big supermarket chains in the UK retail sector. This is proving the level of companion in order to reach the convenience stores in order reach the large level of customer base. 12
Task Strategic plan VisionVision The firm have vision to be art of most retailers where the people have love to work and shop. This is about harnessing the talents with creativity and diversity in order to ensure the customer for receiving the greater services every time. MissionMission The firm have the mission to be the consumer first choice for the food in way of delivering the products with outstanding quality and greater services at the competitive post through working faster, simple and together. Value and CultureValue and Culture Sainsbury have the culture to be heart of everything which have inclusion of team working together, bring new ideas with the best experience for customer and colleagues which the inclusive environments that values community. ObjectivesTo provide high quality products to customer. To maximize the financial return towards the stakeholders. To have effective developments of the customer expectation Strategies (BasedonSuitability, Acceptabilityand Feasibility) Ansoff matrix is the marketing tools for the future growthin way of combination of the productsand services in perfect manner to lead more level of captive advantage in market. market penetration- this have the suggests that’s the company tends to sell the current product in current market which helps in increasing the markets shares (Holotiuk, and Beimborn, 2017). The firm have addoomed the strategy when Tesco have come into the fierce level of compactions. market development- this have the dealing in the business expansions in order to increase the sale of products. he company 13
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should increase its services of banking, credit cards, insurance, holidays, and other services it is providing in United Kingdom. product development-this is considered to be growth strategy to have the introduction of new productswith new version in existinglevelofmarketcompetition.Thecompanyhave formulated the new level of stores in order to have increase the local experience ro the person two are travelling from nearby cities. Diversification- this is the risker ones which is more beneficial to company. There is increased level of investment is required fortherescananddevelopmentdepartmentstohave diversification in there financial merits by proving more linseed insurance. Tactics (Marketing Mix Product- Sainsbury is the leading food retailers in the UK by the owning more than 800 stores which have the clear inclusion of the supermarkets and convenience store by having the 16.3% of the share in market. The company have the product such as the fresh level of fruits and vegetables, fish, meat, chilled, dairy products along with bakery and wines (Yuan,and et.al.,2020). This have the additions to the health and beauty products. Price- the firm have the clear way of targeting the different value of money by the pricing different product belonging to different ranges.The firm want to sure the customer retentions an moisten its quality in the both local and international markets in order t maintain there reasonable and affordable prices to attract customer. Place- the firm have there more level of intributions other convenience store such as kiosk, self-services checkout by the countersuing the products Promotion- . The firm is also avails in there on lines internet spooning to the customer for products to appliable with version 14
offered such as the gift vouchers and gift cards.The firm also used the social media marketing to promote the products. Implementation/Control (ResourceAllocation and Control Measures On the other, the firm will have the implementation of the accrue level of distribution strategies with effective level of balance score cards to have proper evaluation of development of the various strategies in the organization.The balance score card have the proper perspective of the which can be term to the financial , translating the business process along with employee with gains more growth perspectives an customer. Evaluationthe valuation is needed to be done in the perfect mannered with the help of the implementing of the properly key performance indicators. This will, be helpful incensory there more stability by reassuringthestandardofperformancesinperfectmanner (Franco-Trigo,and et.al.,2020).this is help done company to gain control the deviation. CONCLUSION Business strategy for the companies to have the achievement of the specific business objectives in perfect manner. The company is the retrieving positions by expanding its global market share. In this report there will be clear discussion of their external ad internal analysis by the understanding the business activities and different business strategies.In order to have the identify the potential impact by reviewing the Political, Economic, Sociocultural, Technological, Legal, and Environmental factors affecting a business (Goerlandt, Khakzad, . and Reniers, 2017). As the firm have the supplier from Britain and international levels which have believing the sourcing with integrity by forming effective partnership and raising the environmental and social standards. The firm is seeking about to have the differentiations in the strategies to gains more level of competitive advantage which have the allowing them to have the production in democratise designing. The power of buyer is higher which the industry to simplify for the presence of the competitors by selling the same level of products. The firm have there more level 15
of intributions other convenience store such as kiosk, self-services checkout by the countersuing the products. Hence, balance score cards to have proper evaluation of development of the various strategies in the organization 16
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REFERENCES Books and Journals Online Nandonde, F.A., 2019. A PESTLE analysis of international retailing in the East African Community. Global Business and Organizational Excellence, 38(4). pp.54-61. Hayes, J., 2018. The theory and practice of change management. Palgrave Bentham, J., 2018. Business and Economics in the News–Sainsbury's and Asda-the decade's mega-merger.Teaching Business & Economics,22(3). pp.11-12. Nahar, N and et.al., 2018. The Globalization of Malaysia National Cuisine: A Concept of ‘Gastrodiplomacy'. Journal of Tourism, Hospitality & Culinary Arts, 10(1). pp.42-58. Chen, J.Jand et.al.,2019. Differential regulation of auxin and cytokinin during the secondary vascular tissue regeneration in Populus trees. New Phytologist, 224(1). pp.188-201. Vargas-Hernández,J.G.andGarcia,F.C.,2019.TheLinkbetweenaFirm´sInternal Characteristics and Performance: GPTW & VRIO Dimension Analysis. REBRAE. 12(1). pp.19- 30. Yudhistira, G.R., 2016. the Vrio Analysis of Corporate Strategy in Facing the Implementation of the ASEAN Open Skies 2015: the Case of PT. Garuda Indonesia (Doctoral dissertation, UNIVERSITAS BAKRIE). Lewis, R., 2017. Porter's Five Forces of competitive advantage. Lüttgens, D. and Diener, K., 2016. Business model patterns used as a tool for creating (new) innovative business models. Journal of Business Models.4(3). Bıçakcıoğlu, N., Theoharakis, V. and Tanyeri, M., 2019. Green business strategy and export performance. International Marketing Review. Chen, Y., Eshleman, J.D. and Soileau, J.S., 2017. Business strategy and auditor reporting. Auditing: A Journal of Practice & Theory, 36(2). pp.63-86. Holotiuk, F. and Beimborn, D., 2017. Critical success factors of digital business strategy. Yuan, Yand et.al.,2020. Business strategy and corporate social responsibility. Journal of Business Ethics, 162(2), pp.359-377. Franco-Trigo, Land et.al.,2020. Stakeholder analysis in health innovation planning processes: A systematic scoping review. Health Policy. 17
Goerlandt, F., Khakzad, N. and Reniers, G., 2017. Validity and validation of safety-related quantitative risk analysis: A review. Safety science, 99, pp.127-139. 18
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