Porter's Five Forces Analysis of Booker Group: A Study on the Food Wholesaler Industry

This article analyzes Porter's Five Forces model on Booker Group, a food wholesaler. It discusses the competitive rivalry, bargaining power of buyers and suppliers, threat of substitutes, and threat of new entrants in the industry. The analysis highlights the key issues faced by Booker Group and the market structure and size.

FOOD WHOLESELLER : Booker Group
INTRODUCTION
: Booker group is a Grocery chain which offers booker group stuff and founded in around
1835 by Richard rose Booker group in Wellingborough, Northamptonshire. They are
having strong revenue that makes them largest chain in entire the globe. Hence the firm is
having two major competitors as WALMART and TESCO and porter's five analysis is also
showing in it with market structure and size.
Competitors of booker group: The firm Booker group is very famous in the market place as
they have larger number of buyers who loved to be in the grocery store and also liked their
offered food items. Hence company is having more competition in the market and there are
more numbers of competitors for then. The two major competitors are known as WALMART
and TESCO (Weber, 2013).
WALMART: it is an American multinational retail corporation which operate outlets
of discounted department stores, hypermarket and grocery store. They are having
headquarter in the Bentonville, Arkansas, this firm has been founded in 1962 by Sam
Walton. WALMART has around 11 million buyers and also serves on 11,718 places in around
28 nations and acting in 59 different names. This is major competitor for Booker group as
they are also providing same kind of products and food but they have bit higher prices then
sited firm.
TESCO: they are the British multinational grocery and general merchandise retailer
and having headquarter in the Welwyn Garden City, Hertfordshire, England, UK. They are
considered as the ninth largest retailer in the world by their earn profit. TESCO has been
founded in 1919 by Jack Cohen as they are serving around 4600 places in approx. 12 nations
all of them are owned by franchisees that are more than 2100. Booker group seems it as
major competitor as TESCO is providing strong ambience or best quality food which makes
competition between them and Booker group
PORTER’S FIVE FORCES MODEL
Michael porter's five force analysis helps in determining the most relevant external
elements which make influences on the firm. In the evaluation of sited company, it
concentrated on food wholesaler’s industry. It helps in knowing issues and assist them in
resolving all of them. Competitive rivalry: Booker group is having harder competition
because larger number of booker group outlet is already existing in the market (Magure,
2015). This point reviles, all of booker group chains are coming with different sizes and
background like some of them are domestic or some are not but offering same item. It is
important to defeat those firms are which are already located. Hence Booker group needs
to keep their pricing low and maintain best stuff as compare to other so that it will be
harder for customers to make switch.
Bargaining power of buyers: Booker group required to access the signifying power of
customers. This point reviles how firm deals with influences and wishes of their buyers.
Customers have tendency to make switch to one to another firm cause of they are having
some of lower cost for the same product as Booker group itself has many substitutes that
are able to make attractive policies in order to capture more buyers in their firm hence it
is required for Booker group to frame strong strategy in order to boost their buyer's
loyalty. It retains their customers.
Bargaining power of suppliers: Booker group is also get influenced by suppliers. As there
are larger numbers of suppliers which minimise the effects of single or individual suppliers
on booker group. It is majorly cause of the minimum local or global connection in among
suppliers. The suppliers of Booker group are no have vertical intergeneration that means
they are not having control over distribution chain which link to Booker group facilities.
Hence this force of porter's model showcase that the power of suppliers is a minimal
hurdle for booker group.
Threat of substitutes: All the substitutes are very essential thing for booker group. Five
force examination evaluated the possible effects of substitute on the growth of firm.
Company is having many substitute for their product as buyers are also make their
desired food item at home hence it is easy move to switch on lower cost stuff. Some of
other grocery outlet are also a competition of Booker group therefore, all these substitute
are major roadblock that the firm have concentrated with the help of goods quality
improvement. Threat of new entrance: this will impact on the market share of Booker
group as it refers to the effects of new firms on current operated companies. Because of
lower rated goods are available in the market makes easy to switch form Booker group to
other firm. Hence it is expensive to retain their buyers for Booker group therefore they
need to frame effective policies which made them stronger them new entrance and build
effective relation with consumers so that they will remain loyal to them.
Market size: Booker group is having wider market size as booker group is becomes a
trend in UK. The number of using expenditure has been enhanced by around 9% which
are ranked in third position in the context of expenditure, all of them are used by their
consumers (Cheung and Gomez, 2012). The market size of booker group industry is
enhancing form year to year and it reaches to nearly 2,058.8 in recent year. UK firm is
shares also boosted in the recent year by 400 plus.
Booker group is having around 1249 Grocery s in the entire UK. And they are supposed to
begin their newer outlets of each business year. Therefore, it is a wealthy indicator for
Booker group to enhance their share of market in UK.
Competitors of Booker Group
Market structure: Booker group is having wider market structure in
the UK. Hence they are using monopoly in the market because it
helps in making them different form other firms. Its monopoly
makes them most prominent firm in the demand market.
Key issues: Booker group is having some hurdles which are
detailed in two manners such as Nutritional problems and
advertising issues.
Range of demanded product problems:
 They need to available all the goods which
are high in demand to their customers.
 Comparison of regular consumption and
goods of Booker Group.
Advertising issues:
 Higher expanses on advertising of the firm
annually.
 Sound involvement in the activities, events
and learning programme.