Report on Aldi: Strategic Management and Competitive Advantages

This report provides a contemporary analysis of Aldi's strategic management, focusing on how the company builds and sustains its brand image and competitive advantages. It examines Aldi's strategic planning, including market segmentation, targeting, and positioning strategies. The report also explores the implementation of these strategies at different organizational levels, including the roles of leadership and employee training. Furthermore, it presents an analysis of Aldi's external environment using PESTLE and SWOT analyses, highlighting political, economic, social, technological, legal, and environmental factors. The report concludes with recommendations for Aldi's continued success and provides insights into how Aldi can navigate challenges and capitalize on opportunities in the market.

Contemporary Analysis

EXECUTIVE SUMMARY
Contemporary analysis is the process, that is used to identify the exact situation and
strategy which is used by the company. Report present the aim and describe how strategic
management and core competencies help to sustain the company's brand image in market.
Further, report cover different strategy formulation process utilize by a company and plan that
help to develop those strategy into a market.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
AIM..................................................................................................................................................1
DISCUSSION..................................................................................................................................1
Presenting how strategic management can build and sustain competitive advantages...............1
Presenting different strategy use by Aldi....................................................................................2
Implementation of strategy for different organizational level....................................................2
Presenting external environment with capabilities that enhances market opportunity...............3
CONCLUSION................................................................................................................................5
RECOMMENDATIONS.................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Contemporary analysis is the simple process that help to determine the exact performance
of the company. Report mainly focus to provide the skills as well as knowledge related to the
strategy that is used by the company in order to operate their business at further level of success.
Chosen company for this report is Aldi which is one of the most largest retail company in
Australia. Report further explain how strategic management helpful the company in order to
sustain the brand image in market. It also critically evaluated various strategy formulation
process that can be used by Aldi and through effective plan that strategy will be helpful for a
company. Moreover, report also describe the external environment of Aldi as well as describe
capabilities that enhances market opportunity.
AIM
The aim of this report is to develop some skills and knowledge related to strategy which
Aldi uses in order to sustain their brand image in market.
DISCUSSION
Presenting how strategic management can build and sustain competitive advantages
Strategic management is the simple process of planning, monitoring and assess that
whether the company is meet out the goals or objectives in well defined time or not. It has been
analysed that through effective strategic management the company can easily attain their high
performance in market. There are so many strategies which are actually used by many different
company at various level and at that time, this strategy are more effective if the research and
development system of the company is well structured (Doz, 2017). Because this management
system will help Aldi to present different strategy which can be used into the working
environment so that it become more efficient in order to meet out the demand of their customers
and as a result, the production level of the company maximizes and profitability increases. In
addition to this, another management planning includes such that basic financial planning and
Aldi also manages the financial planning of the company and through effective planning related
to finance will be more helpful for a firm in order to build high competition. As the company
have many rivals, but if the strategic management system is good and effective then it will be
more beneficial for a firm to gain high competitive advantages in market and sustain their brand
image in market too.
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Strategic management also includes the forecasting based planning that helps to meet out
the demand of their customers. If the product are meet out need of their customers then it will be
more effective to gain high competition in market. It has been concluded that Aldi have good
strategic management that helps to sustain their customer base that further help to gain or build
image in market.
Presenting different strategy use by Aldi
Aldi also uses market segmentation process in order to reach with each and every
customer so that they will enjoy the products which are offered by their company. In this market
segmentation process Aldi differentiate it on the basis of three segments such as:
Segmentation: Through this, Aldi split a market into smaller groups so that their
customers will enjoy the best brand products as well as services (Hitt & Duane Ireland, 2017).
By using segmentation process, Aldi chooses the people based upon geographic region so that
company will provide best market opportunity to their customers and fulfil all demands and
hence, the profit is also maximizes. Moreover, the people also looking out in order to purchase
the products at competitive prices.
Targeting: Targeting is a process of which a company is selected for a suitable market
and also have the intention that actually focus on the firm's that offer in the market (Wheelen and
et.al., 2017). Hence, in the case of Aldi, the target market is in Australia where all age group
people are actually uses the offered products. The target people of Aldi is families and individual
so that they will purchase the products and raise the profit margin of the company. The
Positioning: As company wants to establish its brand image at global level and therefore,
the places where the brand is already establish, people uses different products and also uses the
products just because of the brand image. As there are many countries where Aldi is already
establish and hence, the company is actually now trying to positioned itself at international
market.
Implementation of strategy for different organizational level
As the company wants to establish its brand image in market and therefore, uses many
strategy in order to reach at global level. As the company also have many rivals and as the
management process changes. Similarly in the case of Aldi too, the management level also uses
different strategy in order to implement those into working area. Hence, starting from the owner
the marketing strategy is also firstly granted by them and as in the production department or
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marketing/ sales department if this is applied then they all accept it with different perspective. On
the other side, leader or manager of the company should provide proper training sessions to their
employees in order to accept those changes into the working area (Meyer, Neck & Meeks, 2017).
As the company is dealing with different sectors and to fulfil those, it is quite necessary to gave
proper knowledge regarding the new implementation of this changes.
Currently company uses market segmentation as a market strategy in order to promote
their current business into further level of success and at different level of company, the
management process is also changes and it can be attain through effective training programs.
While implementation, the CEO of the company have different roles such that they will let
managers know about new product strategy (Hill, Jones & Schilling, 2014). In addition to this,
managers of the company is actually assign duties to different department and through effective
strategy and collaboration in their work will make their employees to accept or implement this
strategy into work area.
Presenting external environment with capabilities that enhances market opportunity
By using PESTLE and SWOT analysis, Aldi can easily determine the the external
environment and company's capabilities or opportunity. This is mentioned below:
Political Factor: High level of conflicts at global level makes the company more
threatened to invest amount for expanding the business at international level. If the company
wants to invest into some other country but they have to follow all the rules and regulations
mage by government which further help it sustain the brand image in market. If there is political
instability in a country then it will direct affect the company's financial performance and as a
result, the profitability also decreases (Wishart, 2018).
Economical Factor: Due to instability of the economy of the country it direct affect
company's profit because during the time recession, people will not purchase the products and as
a result, company's sales will not increases. Moreover, during the time of inflation, the market
also rose up to 3 percent but as Aldi offer their product with different discount prices, then it will
directly affect customers buying power and people purchase products because of cheap and
affordable products offered by Aldi. It has been analysed that because of rise in inflation that
directly affect that shoppers should have to be more aware related to their budget. By offering
the products at discount rates will also help Aldi to maximizes the profit.
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Social Factor: As Aldi is highest paying market having more than 2500 employees and
due to paying higher wages to their customers help to improve the standard of living and also
allow workers to afford better food and healthcare. Du to sudden change in the habit of their
customers buying power Aldi is also uses many marketing strategy in order to raw attention of
many customers towards them (PESTLE analysis of Aldi, 2018). But due to demographic change,
the quoted company is actually faces some problem and supply chain or operational
improvements also drive cost.
Technological factor: Now a days, customer needed more convenient products and high
quality services which is only possible when Aldi uses high techniques into their working area.
If the company uses online mode of selling their products then it will be more beneficial for a
company to maximizes the current business at internation level. As Aldi is also uses different
technologies such as wireless devices, intelligent scale and self- checkout machines that makes it
different from other company. Recently the company adopted EPOS which improved the
efficiency of distribution as well as inventory system and hence, it also saves the cost and time of
the company.
Legal Factor: when Aldi wants to invest into new market then there is a need to follow
all the rules and regulation of all the countries and it further also affected because of having high
scandals. Therefore, Aldi is also found itself in many legal disputes and as a result, the company
brand image is also affected. Therefore, there is a need to follow all the rules and regulations so
that it will help a company to sustain its brand image in market.
Environmental factor: the increasing stock of the products from the local market also
affect the company's brand image but Aldi also take some steps such as sustainability for the
environment (Shim, Kim & Altmann, 2018). This further help a company to sustain its brand
image. As Aldi is also make effort regarding the CSR such that it also contributes its portion for
the welfare of the society too. Aldi also launches new strategy in order to make sustainable
consumption in order to reduce the waste and also minimizes the environment damage also. This
makes company to sustain their brand image in market.
SWOT Analysis:
Strength Weaknesses
 Aldi have brand image in market and
also offer top quality of products with
 For fighting in this competitive world,
it has been analysed that the company
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cheap.
 Company also provide the different
variety of products and have high rates
of portfolio in their store. As the
presence of the company is at world
level (Adem, Çolak & Dağdeviren,
2018).
 At international level, Aldi operates its
unit in more than 12 countries and also
have more than 9500 stores specially in
Europe also.
is actually offered low quality of
products as compared to other
companies.
 As compared to other companies, Aldi
has a small brand as compared to other.
 The company did not operates in
successful manner because there are so
many stores and it is quite difficult for
a firm to operate them at bulk level.
Opportunities Threats
 To sustain in this competitive world,
there is a need to invest some amount
in the company's promotional tool such
as advertising.
 Company can expand their current
business in Asia, and Africa.
 Aldi can re- position it self rather then
provide cheap rates product into
market. This will be helpful for a
company to sustain or raise its brand
image in market.
 Aldi faces high competition in market
such as it has a threat to its rival
companies such as Carrefour, LIDL etc.
 Many government policies and
regulation also affect company's overall
profit margin and as a result, the
company cannot be maximizes the
profit as well as sales (Bailey and et.al.,
2018).
CONCLUSION
By summing up above report it has been concluded that strategic management affect the
company's overall performance. As report concluded that through effective management related
to strategies will help to build or sustain its brand image and to beat other company in this
competitive world. Moreover, report also concluded that by using PESTLE analysis, Aldi can
easily determine the external factor and through SWOT analysis, company can determine the
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capabilities and market opportunities that affect company's to sustain their brand image in
market.
RECOMMENDATIONS
 To sustain the brand image in market, there is a need to enhance some strategic
management system so that it will be helpful for a company to sustain the brand image.
 It is also recommended to Aldi, use advance techniques in order to make the system more
effective and efficient so that it will be helpful for a company to maximize the profit.
 Moreover, if the company invest some amount in the advertising then it will be more
helpful for the company to promote all new products at different level of market. This
marketing promotional tool will further assist the company in order to maximizes the
overall production level and profitability too. So that it will also creates positive impact
upon the company (Starr, Ganco & Campbell, 2018).
 Opening online business will be helpful for a company as well as customer to save
money and time. Further, all the advance technique should also be used into the company
in order to maximizes the brand image in market.
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REFERENCES
Books and Journals
Adem, A., Çolak, A., & Dağdeviren, M. (2018). An integrated model using SWOT analysis and
Hesitant fuzzy linguistic term set for evaluation occupational safety risks in life cycle of
wind turbine. Safety science. 106. 184-190.
Bailey, C. and et.al., (2018). Strategic human resource management. Oxford University Press.
Doz, Y. L. (2017). Strategic management in multinational companies. In International
Business (pp. 229-248). Routledge.
Hill, C. W., Jones, G. R., & Schilling, M. A. (2014). Strategic management: theory: an
integrated approach. Cengage Learning.
Hitt, M., & Duane Ireland, R. (2017). The intersection of entrepreneurship and strategic
management research. The Blackwell handbook of entrepreneurship, 45-63.
Meyer, G. D., Neck, H. M., & Meeks, M. D. (2017). The entrepreneurship‐strategic management
interface. Strategic entrepreneurship: Creating a new mindset, 17-44.
Shim, D., Kim, S. W., & Altmann, J. (2018). Strategic management of residential electric
services in the competitive market: Demand-oriented perspective. Energy &
Environment. 29(1). 49-66.
Starr, E., Ganco, M., & Campbell, B. A. (2018). Strategic Human Capital Management in the
Context of Cross‐Industry and Within‐Industry Mobility Frictions. Strategic
Management Journal.
Wheelen, T. L. and et.al., (2017). Strategic management and business policy. pearson.
Wishart, T. (2018). Proteomic analysis for peripherally accessible biomarkers in Neuronal
Ceroid Lipofuscinosis (NCL).
Online
PESTLE analysis of Aldi. 2018. [Online] Available through:
<https://businessteacher.org.uk/pestel/aldi.php>.
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