Strategic Management : Analysis of Lidl

STRATEGIC
MANAGEMENT

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Executive Summary
In this report there will be analysis regarding the fact that China is a developing and stable
market in the world and hence gives an excellent opportunity to the people. The external
analysis of Chinese market has been done which illustrates the fact that the political and
economic environment of the China is highly stable. The internal analysis of the supermarket
industry has also been done where it is seen that there is higher competition in the market. In
this report internal analysis of Lidl has been done. The analysis depicts that they are using
technology in different aspects of the primary and secondary activities which gives them
competitive advantage over the rivals. This report illustrates about the competitive strategies
being used by the organisation where it is seen that they have applied porter’s generic
strategies in an appropriate manner to improve their competitive strengths. This report will
also highlight the strategic direction of the Lidl where it is illustrated that it can take use of
strategic partnerships to ensure higher growth in the market.

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Contents
Introduction............................................................................................................... 1
External environment................................................................................................... 3
PESTLE analysis..................................................................................................... 3
Porter’s five force analysis......................................................................................... 4
Internal analysis.......................................................................................................... 6
Competitive strategies.................................................................................................. 8
Strategic directions...................................................................................................... 9
Conclusion.............................................................................................................. 10
References.............................................................................................................. 12

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Introduction
In the modern day competitive business, it has become critical for the management to have
plans for the international expansion (Hamilton and Webster, 2018). For the organisations
that are aiming to expand in the external markets, it is critical to have an understanding about
the external and internal environment. According to which they can utilise their resources to
gain competitive advantage over the rivals. For the organisations that are able to manage their
resources in a better manner are able to achieve the desired goals in an appropriate manner.
Lidl is a global discount supermarket chain from Germany which is having more than 10,000
stores across United States and Europe (Lidl, 2019). This firm operates in all member states
of the European Union. Its stores are also present in Serbia, United States and Switzerland. Its
revenue is around 98 billion euro and its net income is 1,541,000,000 euro. Numbers of
employees that works under Lidl are 315,000. This is the fifth-largest retailer in the world.
This store was opened in 1930 where it started as fruit wholesaler which was further
developed as general food wholesaler. Its first discount store was opened in the year 1973
copying the concept of Aldi.
It is seen that EU food sector is growing at much faster rate and with the increment in the
numbers of SBUs of different firms the competition is getting fierce. However due to
emergence of online business there is also increment in the competition which is having
impact on the sales of the organisation (Ai-rong, 2011). With the emergence of Amazon as a
bigger firm there is a serious price competition that has arisen and this has impact on the way
an organisation is dealing with the strategies. In recent years highest level of competition can
be seen in the grocery market.