Organization and Leadership Report 2022

Running head: MANAGEMENT
Organizations and Leadership
Name of the Student:
Name of the University:
Author Note:

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Executive Summary:
The objective of the report is to provide an insight into the cost-effectiveness of the
Australian retail industry. The firm chosen for this particular report is Woolworths which
is one of the most reputed retail firm across Australia. The report undertakes a macro-
environmental analysis through a PESTEL framework that helped in portraying the
impact on the present and the future performances. The report also undertakes analysis
of the porter’s five forces which helps in determining factors that contributed to the
profitability of the firm. The report further identifies the futuristic changes of these factors
and their influence on the firm’s profitability.

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Table of Contents
Introduction:.......................................................................................................................3
Macro-environmental Variable that Impact Current and Future Performance: PESTEL
Framework.........................................................................................................................4
Porter’s Five Forces Analysis and Determination of Profitability of the Industry:.............7
Change of Factors in Future and their Impact on Profitability of Industry:......................14
Conclusion:......................................................................................................................15
Reference:.......................................................................................................................17
Appendices:.....................................................................................................................18
Appendix 1: Organizational Structure of Woolworths..................................................18
Appendix 2: Food Strategy of Woolworths...................................................................18
Appendix 3: Profitability of Woolworth for the Year 2018............................................19

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Introduction:
The aim of the report is to provide an insight into the profitability of Woolworth.
Woolworth is a part of Australian retail industry and is a major retailer of Australia.
Introduced in the year 1924, Woolworths in addition to Coles formed a duopoly within
the Australian supermarkets and accounted for close to about 80 percent of the market
of Australia (woolworthsgroup.com.au 2019). This merchant has close to 995 stores
across Australia and employed approximately 115,000 employees thereby ensuing that
the customers are provided with convenience and greater level of service. Woolworth
works with the Australian growers and the farmers in order to ensure best quality
products to the customers. Woolworth is also known as the innovative retailer since it
had a better understanding of customer need. According to the records published in
2008, Woolworths is the nineteenth biggest retailer across Australia (Akbar and Ahsan
2014). The retailer not only specialized in selling groceries like fruit, meat, packaged
food and vegetables but also sold DVDs, magazines, beauty and health products,
household items, baby supplies and stationery. The retailer has the mission of
delivering the best in terms of value, quality and convenience of the customers.
Woolworth also believes in the value of being environmentally responsible, imparting
fair working condition and in producing quality goods. In the year 2018, the profits of the
retailer rose by 37.6 percent which has been close to $969 million.
The report commences with an insight into the macro-environmental variables
demonstrated by the PESTEL framework and the ways it impacted the present and the
future performance. The report also conducted a Porter’s five forces and identified the
present profitability of the industry along with factors that drove the profitability. Further,

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the report also shed light on how the factors might change and the impact that it might
have on the profitability of the industry.
Macro-environmental Variable that Impact Current and Future Performance:
PESTEL Framework
Political Factors:
The political scenario of Australia has been that of a liberalized and capitalist
democracy. Here state plays a major role in being intrusive with the economy through
adoption of various roles (Fowler 2013). It is however the parliament that undertake a
decision on important taxes for the protection of national economy or implementation of
the protection law in relation to environment for protection of national heritage
In other words, Australia represent a harmless destination for making any
investment due to the presence of stable as well advanced political and regulatory
environment within the country that acts as a means of certainty and confidence to
investors. The efficient, transparent, open and lower levels of corruption pose will pose
very little threat to the supermarket chain like Woolworths thereby casting an impact on
the current and the future performance. This allowed the business to flourish in a better
manner.
Economic Factors:
Australia represents the biggest economy around the world and remains
dominated by the service sector. Economic growth in Australia is primarily dependent
on the mining and the agricultural sector (Storey 2016). Australia has a prosperous
mixed market economy. The market economy of the West experience a higher level of

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GDP and lower level of poverty. The free market of Australia is considered amongst five
most developed countries across the world and has four key components that includes
manufacturing, trade, finance and services. Besides, the country stands at the tenth
position in index which offer ease of performing its business to the retailers. In addition
to this, the GDP figures of the country in fourth quarter of the 2019 has been $343,469
million which marks the country in the thirteenth position in terms of the GDP. The
quarterly GDP per capita has been found to be higher in comparison to the previous
year. All these factors have a positive impact on the present and the future
performance of retailers like the Woolworths.
Social Factors:
Australia refers to a multiracial multicultural country with present population close
to 20 million. The population is expected to experience a projected rise to 3.7 million by
end of 2026 due to rise in the number of aged population, increase in the number of
separation or divorce cases and the delay in marriages. The economy is thus diverse
without no such official religion (Jacobs 2016).The people of Australia is educated and
accepted English as a primary language.
The rise in the population of the country provided positive boost to the current
and future performance of retailers like Woolworths in terms of increase in sales and
enhanced profitability.
Technological Factors:
In the recent year, Australia has been a front runner when it came to technology.
The introduction of the new technologies of communication like internet and e-