Strategic Management: Analysis of Wesfarmers, Coles, and Woolworth

strategic management

Executive summary
With the increasing cutthroat competition in the industry, Woolworth and Coles suffered due
to technological advancement of Aldi. While analysing all the competitors, it can be said that
Coles and Woolworth suffered from a huge loss but Wesfarmers who already operates in
other several business apart from supermarket. The below report is based on the given case
study which have analysed that how Aldi affected the operations of Woolworth and Coles.
Wesfarmers always enjoyed a market share and it contributes a good sum of return on equity.
To the existence of Coles and Woolworth, Aldi became a threat in the industry. It affected the
profits of the Woolworth and Coles. Undoubtedly, Wesfarmers will win as its earning and
market share will not be affected much due to diversified offering.

Contents
Executive summary...............................................................................................................................1
Introduction...........................................................................................................................................4
Macro-environmental analysis...............................................................................................................4
Porter`s five forces model......................................................................................................................6
Company analysis..................................................................................................................................7
Competitor analysis...............................................................................................................................8
Business level strategy..........................................................................................................................9
Recommendation and suggestion..........................................................................................................9
Conclusion...........................................................................................................................................10
References...........................................................................................................................................11

Introduction
Wesfarmers limited is a renowned retail supermarket that is engaged in several business
operations such as liquor, convenience stores, home improvements, coal mining, energy and
fertiliser, office suppliers, supermarkets and hotels. Wesfarmers operates its business through
eight reportable segments named as Coles, Kmart, Resources, WIS (Wes farmer industrial
and safety groups), Chemical, fertilizers, and energy of the same group. The company
operates in Australia, UK, and New Zealand and it is headquartered in Australia. The report
is based on the given case study. According to case study, several competitors in the retail
industry are compared and this case study explains how Aldi (a German outlet) outperformed
Coles and Woolworth by attaining a competitive advantage through technology (Marketline,
2018).
Macro-environmental analysis
Political and legal factors- Legal implication imposed on the emission of carbon has
restricted the production of certain products across Australia. Carbon Tax (fair tax policy)
affect the performance of Wesfarmers. Political stability in the country is necessary that have
impact on Australian supermarkets. Wesfarmers has increased competition among small
retailers, different businesses, and created dominance of individual retail supermarkets.
Rights to the shareholders and laws has restricted monopoly in market. Similar decisions such
as removal of barriers on interest rate for electricity and lucrative side in coal industry was
favourable for Wesfarmers. Although among the competitors, Woolworth enjoys political
stability in both New Zealand and Australia. Various governmental campaigns urged big
companies such as Wes farmers and Woolworth not to affect small existing supermarkets by
conducting any unfair competitive activities (Australian food news, 2014).