Sainsbury's Bakery Expansion Strategy

This report examines Sainsbury's Bakery's expansion strategy into the Indian market. It covers key aspects like methods of expansion, SWOT analysis, barriers to growth, relevant legislation, staff management, and options for growing the business. The report provides a comprehensive overview of the challenges and opportunities associated with entering the Indian market.

Planning the future
strategy for your new
business
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INTRODUCTION...........................................................................................................................4
TASK 1............................................................................................................................................5
LO1..................................................................................................................................................5
1.1 Methods of Expansions:........................................................................................................5
1.2 Key performance...................................................................................................................6
TASK 2............................................................................................................................................9
LO2..................................................................................................................................................9
2.1 SWOT Analysis.....................................................................................................................9
2.2 Barriers to Growth.................................................................................................................9
TASK 3..........................................................................................................................................10
LO3................................................................................................................................................10
3.1 Legislation relevant to employee others..............................................................................10
3.2 Legislation relevant to staff welfare....................................................................................10
3.3 Recruitment process.............................................................................................................11
TASK 4..........................................................................................................................................12
LO4................................................................................................................................................12
4.1 Management of Staff...........................................................................................................12
TASK 5..........................................................................................................................................12
LO5................................................................................................................................................12
5.1 Options for growing a new business....................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15
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INTRODUCTION
Expansion of any organisation is related to increasing its area of service and operations in
other area and regions in where a company haven’t reached yet. In order to expand a business it
is essential to take advantage of proper business plan in order to evaluate the process of
continues fulfilment of needs (Hiatt and Sine, 2014). In this report, chosen company herein is
Sainsbury’s which one of the largest retailing companies in UK is. In this present scenario
organisation is planning to launch their sister company in the market region of India. This report
includes, SWOT, business plan and methods of expansions. Further, legislations and key
performance indicators are also covered in this report.
TASK 1
LO1
1.1 Methods of Expansions:
There are numerous ways with the help of which a business can expand and broaden their
area of service. Mention below there are some mode of expansion through which Sainsbury can
expand their business operations in Indian Market Sector:
Franchising:
Franchising benefits Sainsbury to gain ever growing percentage related to the sales of
their products and services in the Indian Market. As India’s economy is one of the leading and
fast emerging markets. Thus, Sainsbury by granting right to other parties to engage in the
distribution of goods and services business offerings can gain more advantages in India.
Franchising is mainly related to trademark, trade name, service mark and other type of
commercial symbol that has been designated to an affiliate or a franchisor.
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Partnership and Joint Venture:
Sainsbury by joining their business with others in the process of expansion can perform
their operations is a structured agreement. This method of business expansion can be consider by
Sainsbury if they want to avoid related elements of franchising that include owner names,
marketing plan, marks, product line and more. Thus, by taking advantage of partnership
Sainsbury can expand their services through ventures and can further enjoy equal control.
Licensing:
It is a form of an agreement with the help of which Sainsbury can allow other parties in
India to sell company goods and services by bearing marks, names and other related proprietary
property. Example of Licensing, a sports team permits clothing manufacturer to use team logo.
Franchising can prove to be very beneficial for Sainsbury as by taking advantage of
energies and capital of formative motivated operators company can undergo their expansion
procedure in the market place of India.
Business Plan
Overview of Organisation:
Sainsbury’s is one of the largest supermarkets retailing organisation in UK. Company
owns more than 290 convince store along with estimated number of 502 supermarkets within
UK. Organisation has excellent financial performance as their pre-tax profit lead towards at
increase at the percent of 57.3% from 466 million Euros. Main products of company include
food and grocery.
Existing Customers:
Sainsbury’s have more than 1432 stores in UK and offer their places to the customers of
UK, U.S, and Japan, UAE, Argentina and more. With the help of company band influence
Sainsbury have strong chain management and suppliers.
Target new market:
Sainsbury is looking forward to launch their sister company Sainsbury bakery in the
market place of India as due to under developing retail market country have absence of
multinational and local competition (DaSilva and Trkman, 2014). As per the records company
will find profit in this region as there is a prospect of retail growth.
Introduction of new product and services:
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Sainsbury retail is launching Sainsbury bakery in India that will offer totally sugar free
products as individuals in country are moving towards lots of health consciousness.
Increase Staff:
In order to gain large market area Sainsbury bakery plans to recruit highly skilled and
potential workforce range.
1.2 Key performance
It is mainly a measurable value with the help of which Sainsbury’s bakery can effectively
evaluate key business objectives in order to reach out success at high rates. In addition with this
it also helps company to put their focus on overall performance in relation to success of
company, meeting of objectives, employees and more. Mention below there are some KPI’s that
are required to be consider by Sainsbury’s bakery:
Figure 1Key performance indicators
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Values: Sainsbury bakery in order to expand their operations in market place of India is
required to have strong set of values. As this indicates an organisation overall image in front of
consumers.
Strategy: In order to gain advancements it is essential for Sainsbury bakery to take
advantage of numerous effective strategies. It has been seen that India have high level of
workforces that are effectively qualified in English speaking along with this it has been evaluated
that India holds 2nd position in relation to its potential of market entry.
Strategy Map:
Figure 2Strategy Map
Source: Strategic HCM, 2008
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Targets: Sainsbury’s is planning to target marketplace of India by launching its sister
company Sainsbury bakery that will offer sugar free products. It has been expected that retail
sector of India will increase at the rate of 10% by estimating its compound growth upto 1.3
trillion Euros. Company will target small, medium and large sector in the country.
Strategic Management System: Sainsbury’s by taking advantage of strong awareness of
their good quality of food offering to their customers can formulates best effective strategic plan
while ensuring quality assurance in the Sainsbury bakery products. In relation to this, it is
essential for company to formulate budget and investment strategy by evaluating marketplace of
country in an overall manner.
TASK 2
LO2
2.1 SWOT Analysis
STRENGTH OPPORTUNITIES
 India is developing with a fast phase
and is having large market size which
will expect to be increase by 1.2 billion
Euros in upcoming four to five years.
In addition with this, country is having
low labour cost (Teece Peteraf and
Leih, 2016). This will benefit
Sainsbury’s bakery to operate their
functions in a best effective way.
 Sainsbury bakery can take advantage of
localization to create strong brand
image. Like, company can chose Kerala
region of India as it is having optimal
investment environment. In addition
with this country is having literacy rate
upto 90% and have high rate of
economic rate 13.5%. This will help
Sainsbury’s to launch their sister
company in country.
THREATS WEAKNESSES
 There are several shortcomings faced
by entry mode this will made
multinationals to lose their control over
technology. In addition with this, India
is having restrictive commercial laws
 Sainsbury may face poor electric
energy while operating their sister
company Sainsbury’s bakery in India
and country is one of the biggest energy
consuming country. Along with it India
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this will hamper Sainsbury bakery to
conduct their operations in a smooth
way.
faces supply of energy in a poorer
condition thus; Sainsbury baker will
find difficulty in operating their stores.
2.2 Barriers to Growth
Skills Shortage: There is a shortage of information technology in some of the region of
India. This leads towards shortage in skill potential workforce (Jarzabkowski and Kaplan, 2015).
This factor acts a one of the most affected element for Sainsbury’s bakery which will harm its
operations.
Finance: Sainsbury’s is having less FDI experience in Asia. In addition with this it is
relatively hard for company to decrease their transaction cost in an effective way in India.
Competition: India is a high rate developing country it leads towards attracting lot of
multinational investors and companies. Thus, Sainsbury’s bakery will find some difficulties to
score high rate retail sales.
TASK 3
LO3
3.1 Legislation relevant to employee others
There are different types of legislations in India which is required to be consider by
Sainsbury’s Bakery while operating in order to operate their functions in best effective way:
Working Hours:
This legislation is mainly related to providing work hours in an exact and actual time
frame which will not exceed 9 hours in respect to an adult. As per the Labour Law of India, there
is an estimated time period of 8 hours per day working hours which is important to be adopted by
companies in respect of all business types.
Health and Safety:
As per according to Health and safety Act 2011, it is essential for Sainsbury’s bakery as to
operate their activities in Indian marketplace to provide proper health, safety and welfare
measures to all of their workers. In this regard, company is required to provide proper facilities
relating to refreshments, toilets, washing facilities and safe passageways.
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3.2 Legislation relevant to staff welfare
Health and Safety at Work:
The Health and Safety at Work Act states wide range of duties which is required to be
consider by Sainsbury’s Bakery. In relation to this act, company is required to protect health and
safety of all of their workers and other related individuals like, visitors, temps, self-employed,
clients, and general public and casual workers. In this Sainsbury’s Bakery is required to ensure
that they will control risk related to health and safety at workplace.
Facilities:
In relation to this Sainsbury’s Bakery is required to considerably provide relatable
facilities to their workers who will work for them in their different units in India. In this,
company is required to offer hand washing toilets, rest areas and changing facilities to their
workers.
3.3 Recruitment process
Recruitment process of Sainsbury’s bakery goes through a formative process that includes
numerous steps which is mention below;
Analysis of Job:
Proper evaluation of job requirement is consider in this step as with the help of this
company will able to get best effective candidate who posses actual quality and efficiency
against company job requirement (Cascio, 2015).
Job Description:
After the proper job evolution then the job description is required to be provided by
Sainsbury’s bakery with the help of which an individual can able to match their competencies
with actual job requirement of company.
Personnel specification:
With the help of personnel specification Sainsbury’s bakery can effectively able to
evaluate the personal attributes of potential individuals and match that with the requirement of
company job.
Advertising:
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In order to gain high skilled candidates Sainsbury’s bakery is required to conduct proper
advertising relating to their job requirement. They can advertise about their job on newspapers,
online mediums, magazines and other modes.
Short listing:
By analysing personnel specification Sainsbury’s bakery can effectively recruit potential
candidates by short listing them.
Interviewing:
After short listing Sainsbury’s bakery can take advantage of interview method in order to
recruit highly potential and capable individual as per according to actual job requirement of
company.
TASK 4
LO4
4.1 Management of Staff
Performance reviews: It is essential for organisations to review performance of their
employees on regular basis. This will help them to evaluate their actual skills and capabilities in
a best effective manner.
Motivation and Retention: It is important for Sainsbury’s bakery to understand the
concept of motivation as this will help them to retain their employees for long period of time.
Rewards: In order to increase performance level of employees it is essential for
Sainsbury’s bakery to further take advantages of rewards techniques in order to increase both
morale and performance of their workforce.
Training and Development: By providing proper and required training and development
programmes Sainsbury’s bakery can effectively increase capabilities and work efficiency of their
employees.
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TASK 5
LO5
5.1 Options for growing a new business
Understanding existing customers:
In order to effectively launch business in a new market Sainsbury’s can take advantage of
understanding behaviour of their customers. As this will allow them to analyse actual perception
and taste which is currently prevailing in a marketplace.
Target new Markets:
In order to gain as expected return it is important for Sainsbury’s to select target market
in order to offer their products and services in a best effective and estimated way.
Introduce new products and services:
Regular introduction of goods and services will benefit Sainsbury’s to encourage
attention of customers towards company in an influencing way.
CONCLUSION
As per the above mentioned report it has been concluded that, in order to expand a business
it is essential for an organisation to effectively consider different factors related to market
expansion. Along with this proper business plan will help a company to effectively fulfil their
goals and objectives. In addition with this proper understanding of legislations and acts are
required in order to conduct smooth functioning.
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REFERENCES
Books and Journals
Hiatt, S.R. and Sine, W.D., 2014. Clear and present danger: Planning and new venture survival
amid political and civil violence. Strategic Management Journal, 35(5), pp.773-785.
DaSilva, C.M. and Trkman, P., 2014. Business model: What it is and what it is not. Long range
planning, 47(6), pp.379-389.
Cascio, W.F., 2015. Managing human resources. McGraw-Hill.
Teece, D., Peteraf, M. and Leih, S., 2016. Dynamic capabilities and organizational agility: Risk,
uncertainty, and strategy in the innovation economy. California Management Review, 58(4),
pp.13-35.
Bocken, N.M., de Pauw, I., Bakker, C. and van der Grinten, B., 2016. Product design and
business model strategies for a circular economy. Journal of Industrial and Production
Engineering, 33(5), pp.308-320.
Jarzabkowski, P. and Kaplan, S., 2015. Strategy tools‐in‐use: A framework for understanding
“technologies of rationality” in practice. Strategic Management Journal, 36(4), pp.537-558.
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