Competitive Strategies: SWOT, PESTEL and Porter's Five Forces

STUDENT DETAILS
COMPETITIVE STRATEGY

Competitive Strategies 1
In this assignment, there will be a discussion about the competitive strategy of the
business houses. Competitive strategy is the methods which help in outlining the
competitors of an organization. An organization gets competitive advantages when
they have the accessibility of other company’s information like details of suppliers,
their employee retention techniques, etc (Phadermrod, Crowder and Wills, 2019).
Selected competitive strategy for this assignment is SWOT analysis, PESTEL
analysis and Porter’s five forces. The SWOT analysis will be explained with the
business example of Woolworths, PESTEL analysis will be explained with the
business example of Coles supermarkets and Porter’s five forces will be explained
with the business example of ALDI supermarkets.
SWOT Analysis
SWOT analysis is the technique through which an organization can judge its
strengths, weakness, opportunities and threats. It helps in identifying the internal and
external business conditions which are favorable or unfavorable. Strength and
weakness focus on the internal factors while opportunity and threats focus towards
the outside factors (Dobbs, 2014). For the SWOT analysis, the business example of
Woolworths is considered. Woolworths is the well-established supermarket brand in
the Australian market. The growth strategies of the company include satisfying
customers and increasing the profit margins of the company (Tanwar, 2013).
Strength of Woolworths is their market leadership because they hold more than 80%
of Australian market shares (Dobbs, 2014). Their managing perception is also
excellent because they balance segments across the income strata of the people. It
helps them in increasing their business by 55% in the middle-class segment
(Tanwar, 2013). Woolworths pays attention while hiring employees and ensure that
proper training of employees is conducting. In addition to this, the company offers
bonuses and other perks to motivate its human resource (Tanwar, 2013). The
company has over 100,000 employees and 900+ physical stores (Dobbs, 2014).
Apart from this, the company is counted as the oldest company which introduce the
modern retail trade model. Strong brand positioning and effective operations are
other qualities of the Woolworths (Dobbs, 2014).
The weakness of the company included partial behaviour to specific markets. As the
company is known to be partial to higher-level income group people. The company is

Competitive Strategies 2
always in a price war with its competitors (Dobbs, 2014). Apart from this, the
company sends confusing signals in the market by targeting multiple income
segments by utilizing the same product pricing (Tanwar, 2013). The company has a
limited global presence as compared to their competitors (Tanwar, 2013).
Currently Woolworths have stores at the prime locations but still, in Australia, there
are many locations left which can boost the sales of the company if they occupy that
particular location. The company can promote their brands while using various
methods of advertising and promotions techniques (Tanwar, 2013).
Threats include the people's behaviour of focusing on health. As populations are
appreciating products which are 100% chemical-free and organic. However, this
creates major threats for the brand (Tanwar, 2013). The company needs to change
its products cycling in order to satisfy the demands of the clients. The biggest
competitor of the company is the Coles Supermarket (Tanwar, 2013). Apart from
this, increasing the cost of food materials and other items can impact the profit
margins of the company. Economic recession can act as a barrier for growth in the
market (Tanwar, 2013).
PESTEL Analysis
PESTEL analysis is the tool used to monitor the macro-environmental factor. By
using the PESTEL analysis an organization can judge their performance. This tool is
used in collaboration with the other tools like SWOT analysis and Porter’s five forces.
The term PESTEL stands for Political, Economic, Social, Technological,
Environmental and Legal. Selected company for the PESTEL analysis is the Coles
Supermarket (Pechey and Monsivais, 2015).
The laws related to the business have both positive and adverse effect on the Coles
Supermarket chains. Contract law directs that what Coles can conduct and what they
cannot conduct in the country (Trevena, et. al., 2015). On the other hand, many
times the government system has an inefficient amount of red tape which results in
discourages business houses. The company also have to offer the minimum wages
to their employees as described in the Wages Act of the country (Harvi, 2017).