Economics of Coles Supermarket

ECONOMICS.
COLES SUPERMARKET
Name:
Tutor:
Course:
Date:

ECONOMICS.
Table of Contents
1.0. INTRODUCTION................................................................................................................1
1.1. Background Information................................................................................................1
1.2. Overview of the groceries industries...........................................................................1
1.3. Australian Economic Condition....................................................................................1
2.0. Market structure.................................................................................................................2
2.1.1. Limited Number of sellers......................................................................................2
2.1.2. Interdependence.....................................................................................................2
2.1.3. Advertising...............................................................................................................2
2.1.4. Competition..............................................................................................................2
2.1.5. Entry and Exit Barriers...........................................................................................2
2.1.6. Lack of Standardization.........................................................................................2
2.2. Competitors performance based on the market........................................................3
3.0. FACTORS OF DEMAND AND SUPPLY........................................................................4
3.1. FACTORS OF DEMAND..............................................................................................4
3.1.1. Choices and Favourite products of the Consumers..........................................4
3.1.2. Individual’s Income.................................................................................................4
3.2. FACTORS OF SUPPLY................................................................................................4
3.2.1. Input Cost.................................................................................................................4
3.2.2. Government Policy.................................................................................................5
4.0. ELASTICITY AND FACTORS OF ELASTICITY...........................................................6
4.1. Elasticity...........................................................................................................................6
4.2. Factors determining elasticity of demand...................................................................6
4.2.1. Total Spending........................................................................................................6
ii

ECONOMICS.
4.2.2. Duration of time.......................................................................................................6
5.0. MARKET ANALYSIS.........................................................................................................7
6.0. CONCLUSION....................................................................................................................8
References.....................................................................................................................................9
APPENDICES..............................................................................................................................11
Appendix 1: GDP of Australia from 2016 to 2019..............................................................11
Appendix 2: Inflation Rate of Australia from 2015-2019...................................................11
Appendix 3: Unemployment Rate in Australia from 2018 to 2019..................................12
Appendix 4: Foreign Exchange Rate in Australia from 2018 to 2019............................12
Appendix 5: Coles Supermarket re-usable Containers....................................................13
Appendix 6: Coles Supermarket...........................................................................................13
iii

ECONOMICS.
1.0. INTRODUCTION
1.1. Background Information.
Australian Coles supermarket was among initial supermarkets to be operated in
the country. George Coles established the supermarket 1914. These Supermarkets is
among the titan’s supermarkets with major market shares, operating in Australia (Keith,
2012). Wesfarmers operates a group of Coles Supermarkets which include over 750
supermarket store, 790 liquor outlet, 90 hotels and 627 fuel and convenience sites.
Among various portions of the Coles Group, roughly 18 million client traded every week
in the fiscal year 2011/12 with more than 100,000 workers. In the year 2011/12, the
business received over 23.6 billion dollars in terms of income from their business.
Presently, the business is found in almost every part of Australia. The products which
Coles offers is convenient to its customers (Johnston, Stafford, Pierce, & Daube, 2017).
1.2. Overview of the groceries industries.
The grocery sector is one of the greatest significant sectors in Australia
economy. The cost of food has daily influence on the lives of buyers. The sector hires
an important percentage of the workers and has relations to several additional sectors
in the Australia economy, comprising of agriculture sector, manufacturing sector and
transport sector. For that reason, grocery sector is a sector of great importance to
strategist and the government (Wong & Joshi, 2015). New market entrants including
Costco and ALDI which has extended its operation from the time it entered the market
more than eighteen years ago. The relations amongst supermarket and fuel sectors
have been returned to normal state. In reaction to fears that prices of commodities were
upsetting peoples during the 2008 recession, the Government of Australia ordered the
concerned sector to evaluate the sector (Azavedo & Walsh, 2018). Different
Supermarkets have come up with their own pricing and marketing approaches. For
instance, Coles has a pricing and marketing campaign known as “Down Down” which
has been there since 2010. Their main competitor Woolworths has a pricing and
marketing referred to as everyday low prices. Lastly, other supermarkets like IGA has a
pricing and marketing approach known as Locked Down Low Prices (Nwankwo, 2018).
1.3. Australian Economic Condition.
In the fiscal year 2018 the Coles Supermarket made a revenue of 39.29 Billion
AUD (Pulker, Trapp, Scott, & Pollard, 2018). The Australia yearly price increase
rate in dropped to 1.3% in the 2019 from 1.8% in the preceding year and mislaid market
opportunities of 1.5%. The rate of jobless among young individual between ages 15 and
24 years is 12.7 percent in the year 2016 in addition to the total jobless rate of over 5.0
percent (Khemka, Roberts, & Higgins, 2017). The Australian dollar against the United
States dollar is the major currency duo traded in the Australia Stock exchange market
contributing to 45 percent of the overall foreign exchange income (Manalo, Perera, &
Rees, 2015).
1