Business Strategy for Asda: Analysis, Directions, and Competitive Environment

BUSINESS STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................3
PART A...........................................................................................................................................3
Macro Environment Analysis.................................................................................................3
Internal Environment Analysis...............................................................................................4
PART B............................................................................................................................................7
Different Strategic Directions.................................................................................................7
Competitive Environment Analysis.......................................................................................8
Strategic Plan........................................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Strategy is high level plan to achieve one or more goals under different condition of
uncertainty. Asda is the second largest retail supermarket chain store in UK. Asda was founded
in the year 1949 by J.W. Hindell and Noel Stockdale. This reports highlights internal and
external current position of the business with the help of different type of tool and framework.
After that the report highlights the Different strategy theory which can be used by Asda. After
that the report highlights the recommendation and strategic plan which is best suitable for Asda.
PART A
Macro Environment Analysis
PESTLE ANALYSIS
Pestle Analysis is a framework which is generally used to analyse the macro environment
factor which may have impact on organizational performance.
Political Factor: Political factor are at positive side for Asda, as there is good political
stability in the UK. This eventually help company in staying with the same organizational policy
for longer period of time in the stable political situation (Perera, 2017). On the other hand
political decision like Brexit has created some sort of uncertainty in organization as it will get
difficult for company to export the different product that cheaply in UK from neighbour nation.
Economic Factor: Economic factor is also at favourable side, as Inflation rate and
Interest rates in UK are at favourable side, which help company in getting good amount of
finance to run operations of business. At the same time, Increasing Labour cost and Fuel cost in
UK used to impact profit margin of company in long run of business. Also increase in the cost of
the water consumption in the UK has also impacted the business in long run of the business, as
this has increased the cost of the company in the market to carry out different operation of the
business.(Rastogiand Trivedi, 2016).
Social Factor: Social factor used to impact ASDA, as need of customer and trend in the
market used to change on frequent basis. This eventually drive company to adopt different
operation as well. To overcome the same issue Asda used to invest heavily in research and
development program to make a product which can satisfy need of the customer in the market.
Generally, customer in UK are looking to consume healthier food (Christodoulou and Cullinane,
2019.)

Technological Factors: Technological factors are variables that are being used for
evaluating available alternatives with respect to technological capabilities In rapidly changing
environment, technology to carry out operation generally used to change on rapid basis. This
used to create variety of difficulties for an organization. As it gets difficult for the company to
decide the best technology which can be used by organization to carry out the operation of an
organization (Achinas and et.al., 2019). At the same time this factor also used to impact the cost
structure of the company as they has to invest good resources of organization to procure
technology in the organization in long run.
Environment Factor: This factor is on favourable side of Asda, as Asda generally uses
recycled raw material to developed different packaging material in the organization. Also,
organization always used to check the quality of product before offering same to consumer. At
the same time factor like hazardous waste, carbon footprint are factor which need to be
considered by Asda (Perera, 2017). Also climactic change in the UK used to create the variety of
the different issue for the organization, as it used to delay the operation of the business in the
long run.
Legal Factor: This factor looks at different legal laws and regulation through which
organization has to dealt in the organization. Legal Factor are not favourable side for Asda, as
Asda has to compile the operation of business with many type of legal policy (Rastogi and
Trivedi, 2016). This eventually used to impact the efficiency of business as it sometime takes
more than usual time to take different permission to compile with different laws and regulation.
Internal Environment Analysis
SWOT ANALYSIS
SWOT Analysis is the framework or tool which is used to show the internal position of business
in the market.
Strength
Product Line: Asda used to offer good number and variant of product in the market, this
eventually help company in attracting the eye of good number of customer toward organization.
Asda generally used to manage their product line on the basis of seeing the need of product in the
market and offering the same, so that consumer finds it easy to satisfy their need (Gürel and Tat,
2017). Product line of the company includes the retail, technology and childcare product in the