Kaufland: Entry into the Australian Retail Market

Running Head: Kaufland
Kaufland
Report
System04104
5/2/2019

Kaufland
1
Executive Summary
Kaufland is one of the famous grocery retail stores in Germany, which is looking for
starting its business in the Australian retail market. The low pricing strategy of Kaufland and
better political and economic support from Australian government can help Kaufland to enter
in the Australian market, but a large number of competitors and lack in technology can be
termed as the major obstacle to enter in the Australian market. As people in Australia are
very price sensitive and switch quickly to other alternative options, the strategy of low
pricing might be effective in Australia for Kaufland, despite being its financial problem.
Although, the company has strong financial support from its parent company Schwarz Group
and it helps Kaufland to enter the Australian market. Apart from this, the attraction of people
towards online shopping of grocery products also provides an opportunity for the company to
expand its business and enhance its market share in the Australian retail market.

Kaufland
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Table of Contents
Executive Summary...................................................................................................................1
Introduction................................................................................................................................3
SWOT Analysis of Kaufland.....................................................................................................3
PESTLE of Kaufland.................................................................................................................4
Porter’s Five Forces of Kaufland...............................................................................................5
Value Chain Analysis of Kaufland............................................................................................6
VIRO Framework.......................................................................................................................7
Identify Kaufland’s Strengths and Weakness............................................................................7
Strategic Evaluation and Recommendation...............................................................................8
Conclusion..................................................................................................................................8

Kaufland
3
Introduction
Kaufland is a famous grocery retail market in Germany. Kaufland is a part of Schwarz
Group, which also owns Lidi and Hanadleshof. Kaufland was founded in Neckarsulm
(Germany) in 1984 and now it has more than 1300 stores with 150,000 employees across
seven European countries (Kaufland, 2019). This report presents a strategic report on
Kaufland and provides various analysis and evaluation of the company that helps in its entry
into Australia. The present report discusses the external environment of Australia and
identifies various threats and opportunities for Kaufland in the country. Further, the report
also discusses the strength and weakness of the Kaufland retail chain in the form of SWOT
analysis. Overall, this report helps to understand how Kaufland establishes itself in Australia
and what are the opportunities and threats for the company in future Australian retail market
(DW.com, 2018).
Kaufland is a chain of grocery retail stores in ‘Lifestyle and Retail sector' and the USP
of the company is ‘Quality within cost'. The company's tagline is "Where quality costs less."
Kaufland targets middle-class people and households by providing a number of varieties of
products within the low prices. It targets those customers and individual who are looking for
daily needs grocery stocks and visit frequently in stores (Kaufland, 2019).
SWOT Analysis of Kaufland
SWOT analysis helps to understand the Company's external and internal
environmental factors that show its capabilities to operate its business operations. SWOT
stands for Strength, Weakness (Internal factors or capabilities of the organisation), and
Opportunities and Threats (External factors of the organisation).
Strength: Kaufland covers more than 1300 stores in seven European countries and it
is one of the largest grocery retail chains in Germany. The company strategy is to provide
quality products to its consumers within low prices and offers a variety of choices of
products. The company is a brand name in European country including Germany and Poland
and it acquires various small stores that enhance its brand image in the country. The company
has more than 150,000 employees and has a strong financial position in various markets
where it operates its business.