Strategic Planning and Management for Woolworths in Australian Retail Industry

Running head: STRATEGIC PLANNING AND MANAGEMENT
Strategic Planning and Management
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1STRATEGIC PLANNING AND MANAGEMENT
Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................2
Porter’s five forces analysis.........................................................................................................2
Resources and competencies of Woolworths..............................................................................6
SWOT analysis............................................................................................................................7
Conclusion:......................................................................................................................................9
Reference List................................................................................................................................10

2STRATEGIC PLANNING AND MANAGEMENT
Introduction
Woolworth’s supermarkets are referred to a highly reputed supermarket chain in
Australia. The supermarket chain belongs to Woolworths limited and the mentioned grocery
chain along with Coles has formed a duopoly in the Australian supermarket. The company
chiefly sales groceries that includes fruits, vegetables, packaged meat along with household
products, baby and pet supplies. Considering the fact that with globalization, the number of
competitions in the Australian retail industry is increasing it is highly crucial for Woolworths to
assess both its internal as well as external environment of the company in order to detect major
loopholes that bear the potential to decrease the revenue of the company. In this report, the
environment of the retail industry in Australia will be assessed with the help of Porter's five
forces. Along with that competitor analysis, SWOT Analysis and identification of the
competencies and resources of the mentioned organization based on the Resource-based theory
will be performed in this report.
Discussion
Porter’s five forces analysis
The Porter’s five forces framework is a tool that is used for analyzing the competition
that a business has to face in a certain industry. Considering the fact that the retail market of
Australia is highly saturated, the external environment of Woolworths has been assessed through
the mentioned tool below.
The threat from new entrants

3STRATEGIC PLANNING AND MANAGEMENT
Considering the fact that Woolworth is a highly recognized supermarket chain in
Australia, the threat from the substitute is low. Since the cost of establishing a new business in
the highly saturated market is high, it is highly difficult for the new grocery store to compete
with the recognized ones. The Australian retail industry is dominated by a few numbers of major
players, Woolworths being one of them. The expensive start-up can be considered to be another
major barrier for new competitors. Moreover, the local laws along with the leasing agreement
with the Landlords gave created an artificial scarcity of grocery store sites.
Rivalry among the competitors
As being discussed earlier, the retail and grocery industry of Austria is highly saturated due to
the presence of large retail firms like Coles, Mayer and Woolworths. Hence the rivalry among
the competitors is high. However, considering the fact that Woolworths have a huge amount of
market share in the Australian retail industry, the risk of losing competitive advantages is low for
the mentioned supermarket chain. Additionally, the new strategies implemented by the company
like selling fresh food items only, lower price range and 24 hours delivery service of the
company along with its subsidiaries like Safeway, Dicksmith and other have created an effective
competitive advantage.
Bargaining power of the suppliers
Considering the fact that a huge number of suppliers are present in Australia, the
bargaining power of the suppliers of the Australian retail industry is low. The vast market share
of Woolworth and Coles can be considered as another reason behind the lack of power of the
suppliers. The two mentioned company controls more than 80 percent of the total market. Hence
all the local producers have extremely limited intermediaries to select from. Hence the major