Situational Analysis of Woolworths: SWOT, PEST and Competitor Analysis

This assignment conducts a situational analysis of Woolworths, an Australian supermarket and grocery store, through SWOT, PEST and competitor analysis. It includes background information, strengths, weaknesses, opportunities, threats, external environment analysis, and competitor analysis.

Running head: MARKETING FUNDAMENTALS
Marketing Fundamentals
Name of Student
Name of University
Author Note

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MARKETING FUNDAMENTALS
Table of Contents
Background of the company......................................................................................................2
Situational analysis.....................................................................................................................2
SWOT analysis.......................................................................................................................2
PEST analysis.........................................................................................................................3
Competitor analysis................................................................................................................4
Bibliography...............................................................................................................................6

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MARKETING FUNDAMENTALS
Background of the company
Woolworths is an Australian Super market and grocery store that was founded in
1924. The company along with its Coles consist of a duopoly in the market that accounts for
about 80% of the market share (Woolworths.com.au, 2018). The specialisation of
Woolworths is the sale of groceries such as vegetables, fruits, protein products, packaged
food and many more (Woolworths.com.au, 2018). Apart from these items, Woolworths also
specialises in the sale of magazines, DVDs along with health and beauty products. Currently
Woolworths operates in 1000 stores across the country and own 976 super markets with 19
conventional stores. Like many of the modern day organisations, Woolworths also consists of
a home shopping delivery service that allows online purchasing of products to take place
(Woolworths.com.au, 2018).
The assignment conducts a situational analysis of the company in terms of its
strength, weakness, opportunities and threats. Along with this, an external environment
analysis is also conducted via the PEST method that takes into consideration key factors of
the external environment. A competitor analysis is conducted to identify and analyse the
threats that exist in the business.
Situational analysis
SWOT analysis
Strength
 Reputed in Australia
 Has a huge amount of labour force
 Strong brand and loyal customers
Weakness
 Limited global presence
 Excessive online brands has reduced
its growth

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MARKETING FUNDAMENTALS
 Pricing blunders
Opportunity
 Promotion of the brand through
advertising and social media
 Grow through strategy acquisition
 Establish stores in new Geographical
region
Threat
 Rise of raw material cost
 Economic recession
 Competition from international
companies
Table 1: SWOT analysis
(Source: Created by author)
The analysis show that the strength of Woolworths lies in the fact that it is reputed all
over Australia and consists of a large labour force with over 100,000 employees. At the same
time, it has a strong brand and loyal customers. However, determining proper prices of the
products is a weakness that has affected the growth of the market. Korableva and Kalimullina
(2016) observed that the rise of online brands has reduced the growth of the company and
Woolworths has failed to make a global impression. This has posed threats in a way that
competition is more from the internationally famous brands such as Tesco or Walmart. The
economic recession in Australia prompts the company to raise the cost of raw material and
with it the overall cost of the product. However, opportunities in the form of promoting the
brand though social media is present and Woolworths can establish its market in the global
area through acquisition of smaller brands.
PEST analysis
As stated by David, David and David (2017) certain factors affect the progress of an
organisation in the market and can pose a negative consequence in terms of its growth. Some
of the factors that Woolworths need to negotiate include:

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MARKETING FUNDAMENTALS
Political condition of Australia: It has been seen that the political condition of
Australia allows the growth of new industries for the economic development of the country.
This can be a negative factor for Woolworths as the company may fall vulnerable to the
intense competition from the internal market.
Economic fluctuations: The economic fluctuations in the market may be considered
as a huge threat as the imbalance in the economy may cause a drop of sales of the company.
Thereby the decision of the customers to purchase products from the company may be
influenced by the financial stability.
Social support: The social support of the community is needed for the development
of a company (Pan, Chen & Zhan, 2018). The popularity of Woolworths provides the
company with an advantage of gaining the loyalty of the customers and support from the
society.
Technological competence: In the modern world, technology plays a key role in the
progress of a market. For Woolworths, the application of online marketing can prompt the
customers to continue to remain loyal to the company and improve its decision to purchase
from Woolworths.
Competitor analysis
Attributes Weight Woolworths Tesco Walmart
Daily food
products
50% 4 4 5
Customer
satisfaction
50% 4 5 3
Table 2: Competitor analysis

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MARKETING FUNDAMENTALS
(Source: Created by author)
From the table it can be seen that the reason behind Walmart and Tesco is considered
as major competitors to Woolworths is because all three companies direct their focus to the
daily food products that purchased by the customers and the level of satisfaction obtained.
Equal importance is given to both the factors and it is seen that in term of daily food
products, Walmart is superior to the other two companies whereas in satisfying the
customers, Tesco is more superior.

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MARKETING FUNDAMENTALS
Bibliography
Chen, M. J., & Miller, D. (2015). Reconceptualizing competitive dynamics: A
multidimensional framework. Strategic Management Journal, 36(5), 758-775. DOI:
https://onlinelibrary.wiley.com/doi/abs/10.1002/smj.2245
David, M. E., David, F. R., & David, F. R. (2017). The quantitative strategic planning matrix:
a new marketing tool. Journal of Strategic Marketing, 25(4), 342-352. DOI:
https://www.tandfonline.com/doi/abs/10.1080/0965254X.2016.1148763
Jin, J., Ji, P., & Gu, R. (2016). Identifying comparative customer requirements from product
online reviews for competitor analysis. Engineering Applications of Artificial
Intelligence, 49, 61-73. DOI:
https://www.sciencedirect.com/science/article/pii/S095219761500278X
Korableva, O. N., & Kalimullina, O. V. (2016). Strategic approach to the optimization of
organization based on BSC-SWOT matrix. In Knowledge Engineering and
Applications (ICKEA), IEEE International Conference on (pp. 212-215). IEEE. DOI:
https://ieeexplore.ieee.org/abstract/document/7803021/
Pan, W., Chen, L., & Zhan, W. (2018). PESTEL Analysis of Construction Productivity
Enhancement Strategies: A Case Study of Three Economies. Journal of Management
in Engineering, 35(1), 05018013. DOI:
https://ascelibrary.org/doi/abs/10.1061/%28ASCE%29ME.1943-5479.0000662
Woolworths.com.au. (2018). Retrieved from https://www.woolworths.com.au/