Strategy Evaluation of Sainsbury - Assignment
Added on 2021-02-20
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Strategic Report
Table of ContentsINTRODUCTION...............................................................................................................3Q1. External analysis...........................................................................................................3Discussion of the business environment and identification of a number of Opportunities.3PESTLE Analysis:..........................................................................................................4Industry analysis (5 Forces)............................................................................................6Porter Five Forces Analysis:...........................................................................................6Q2. Internal analysis............................................................................................................8VRIO ANALYSIS..........................................................................................................8Q3. Strategy Evaluation.......................................................................................................9CONCLUSION..................................................................................................................10REFERENCES..................................................................................................................11
INTRODUCTIONIn modern time, business environment is carrying ample number of uncertainties, and it is required for organisations to keep their focus on offering customers an aim of fulfilling their needs and requirements. This can be done through a range of business strategies that could help firms in enhancing their profit margins (Bansal and Song, 2017). For an example, a company has reached to a no loss and no gain situation, over here it will be required for the organisation to examine the environment, identify best possible opportunities and select the fruitful strategy in order to overcome all the issues and gain competitive advantages. In this context, a case of Sainsbury's where company has proposed to get merged with ASDA using merger acquisition as its strategy for growing their business faster (Proposed Sainsbury’s and Asda merger. 2018). This report is going to present external analysis, internal analysis of the business company and lastly, assignment is going to cover the strategy evaluation of Sainsbury's which will required to be adopted by them in future when will merge with Asda.Q1. External analysisDiscussion of the business environment and identification of a number of OpportunitiesAn external analysis is basically being done to analyse the situation of industry in which organisation is performing and it is also aid in looking business environment to a wider context. In this context, external analysis is going to be done of retail/grocery business sector, in which Sainsbury's is performing its operations. The report discusses about Sainsbury's strategy when they will merge Asda. It has been analysed that Sainsbury's UK's top leading supermarket that offer huge variety of products to its customers. Sainsbury's holds second position in overall retail industry whereas at same time Asda captures third position at same market in same industry. By observing each other's command on retail industry both the companies have decided
to get merged so that they can capture maximum customers and increase their market share with the support pool of resources of each other (Bansal and Song, 2017). Along with this, it also helpboth the company becoming leading company in retail industry by defeating TESCO with the collaboration. But, it has been seen that this merger is yet not executed due to stake made by Competition and Market Authority. This authority have declared that if this merger will be executed then it will affect customers a lot. This is because, merger of these two companies will increase prices of products in retail industry which will directly influence competitors to raise their prices as well. As a retail, this whole situation will affects customers at highest level. Therefore, the merger of both the companies that is Sainsbury's and Asda is still on hold (Brewster, 2017). By analysing overall situation, Sainsbury's manager has conducted an investigation for assessing external market in order to find out available opportunities and issue at marketplace. In this regard. PESTLE analysis has been conducted for analysing whole business environment in order to understand its influence over Supermarket. All of the main factor included in this framework are described as below:PESTLE Analysis:Political Factor – This factor is mainly related to various governmental legislations like tax policies, entry and exit legislations, political stability of the nation etc. With reference to Supermarket in retail industry, it can be bring opportunity as well as threat for the supermarket which are described as below:Opportunity: Political condition of UK is highly strong as the nation is already developed. This brings opportunity for supermarket's located in UK as they are aware about existing policies of the UK which makes it easier for them to execute their business activities in right manner.
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