ALDI: Analysis of Market Position and Strategic Recommendations

This report provides a comprehensive analysis of ALDI's strategic position in the retail industry. It begins with an introduction outlining the company's objectives and the report's structure. The core of the report evaluates ALDI's current market position using strategic frameworks such as Porter's Five Forces, technology life cycle, and the Abernathy-Utterback Model. Porter's Five Forces assesses the competitive forces impacting ALDI, while the technology life cycle examines the evolution of technology adoption within the company. The Abernathy-Utterback Model explores product innovation, competitive environments, process innovation, and organizational structure. The report also includes a SWOT analysis to identify ALDI's strengths, weaknesses, opportunities, and threats. Finally, a mind map is presented, offering strategic recommendations for ALDI to regain and strengthen its market position. The report concludes by summarizing the key findings and providing references for further research.

Report A
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TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
Evaluation and analysis of current position of ALDI..................................................................3
Porter five Force..........................................................................................................................3
Technology life cycle..................................................................................................................4
The Abernathy – Utterback Model..............................................................................................6
SWOT Analysis...........................................................................................................................7
Mind map that can be used by firm to regain strategic position..................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
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INTRODUCTION
Every organisation is build in order to earn large amount of profit margin and market
share by satisfying needs of customers. Therefore company need to prepare appropriate strategy
to get desired positioning in the market segments. It will helps in growth and success of company
for long term and build strong brand image in the market thus attracting number of customer to
choose products and services of particular company. This report is about ALDI that is operating
is business that worldwide offering products and services such as home, food products and cloth
to meet requirement of customers. It also uses various model and theories of strategic framework
to evaluate current positioning of firm and the way firm can achieve its desired goals.
Evaluation and analysis of current position of ALDI
Continuous analysis and evaluation of market position of firm helps in finding new and
innovative method to gain opportunities and face challenges for effective operation of business
and achievement of predetermined goals (Rowe and McLaren, 2017). Therefore various strategic
frameworks that can used to evaluate current market position of ALDI are as follows:
Porter five Force
It is powerful tool that helps company in gaining competitive positioning in the industry
through identification of potential profitability strategy. Porter five forces evaluate various forces
present in environment effects firm operation and productivity thus that it promote growth and
expansion of business.
Degree of Existing Rivalry: It analysis availability of number of competitors in the market
company operate its business and quantity, quality of products offered by them to customers.
ALDI operates in retail industry that has large number of competitors with wide varieties of
differentiate products to satisfy need of people in most effective manner (Scott, 2019). Degree of
existing rivalry is high among retail industry so ALDI provide qualitative, unique and innovative
products to charge competitive pricing from customers. Therefore it helps company in gaining
competitive advantages and expansion of its market share in retail industry.
Threat of potential entrants: Company operation is also effected by threats of new entrance
within market to run and operate its business in the industry. It is not easy for new company to
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enter into retail industry of Australia as high amount of investment and capital is needed to offer
wide varieties of products. ALDI has patent its technology and products so that it is difficult for
other competitors to offer similar types of products at reasonable rates thus helps in creating
strong brand image and customer loyalty. Thus, it can be stated that threats of potential entrants
is low in the industry ADLI operate its function.
Bargaining power of suppliers: Company needs input to manufacture finished products so
supplier may have power to increase price of raw material. But ALDI operate in such industry
where there are large number of supplier that offers quantity and qualitative products at
reasonable rates. Therefore power of supplier is less that provides opportunity to firm to grow
and expand its business across nation (Samad, 2018). Strong brand image is another strategy that
is used by ALDI to cater large number of supplier so that customer needs can be meet within
limited time.
Bargaining power of buyers: It refers to ability and capabilities of buyer to drive price of
product to lowest by bargaining with company. Customer have high bargaining power as there
are large number of retailer that offer quality products to people in order to expand their market
share (Bayraktar and et.al., 2017). Therefore due to high power of customers ALDI has planned
to provide innovative and attractive products at reasonable rates thereby helps in increasing
customer satisfaction and loyalty.
Threats of substitute products: These possess high threat to company products as substitute
products are similar and can be place in case of firm products and services. ALDI manufacture
high differentiate and qualitative products so threats of substitute products is low as customer are
ready to pay high price for quality of products and services offered by ALDI. Thus, it helps
company in increasing its profitability and sales volume through retention of new and existing
customers.
Technology life cycle
It another model that helps in finding strategic positioning of firm through evaluation of
technology used by company in order to offer products and services to customers. Technology
life cycle is model that illustrated adoption, acceptance and decline of new innovation and
technologies. Therefore it is classified into four main distinct stages such as research and
development of products that can satisfy need of people (Krystofik and Gaustad, 2018). Ascent,
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maturity and decline are some of the stage of technology cycle that needs to analyse by each and
every firm to gain competitive advantages. ALDI has effective evaluated net return form
investment made in research and development of products in order to maximise its share of
profitability. Due to continuous innovation and development in technology ALDI has to bring
new and innovative ideas to meet expectancy of customers and enhance its market share.
Therefore technology cycle helps in evaluating time and effort spend to get particular result from
specific projects. Various stages of technology cycle are as follows:
Era of ferment: It is the initial stage where company launches new products and services or
enter into new market share to expand its operation. ALDI has continuously launch new products
and enter into new market to satisfy need of wide number of people. Strong brand image and
customers satisfaction helps company in quick launch of new products and service or to enter
into new market to meet needs of people (Waheed and et.al., 2018). Dominate design and quality
of products has been strongly established by ALDI to promote growth of enterprise for long run
and to make customer happy and satisfied.
Take off: In this stage products and service have gained dominate position in the market as
adopted by large number of people or majority. ALDI has dominate retail industry through
offering innovative products thus it state that company is continuous growing and expanding its
business. Therefore it helps company in gaining competitive advantages and enhancement of
market share of ALDI.
Maturity: Other competitors of ALDI by evaluating performance of company also planned to
innovate their products and services to provide products at cheaper rates. Increase in competition
level has lead to loss of strategy position of ALDI so it had to plan new innovation to regain its
competitive position in the market.
Era of increment changes: After dominant design and qualities of products ALDI plans to
innovate its products and services so that best and better experienced can be provide to people
(Ghauri and et.al., 2016). Continuous research and development, new marketing strategy used by
ALDI helps firm to increase its market share and profitability, retention of customers.
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The Abernathy – Utterback Model
It is another strategic model that is developed by Abernathy and Utterback which state
product innovation, competitive environments, process innovation and organisational structure
are interrelated with each others. Development of model have three phases that impact on
performance and productivity, resource, capabilities, market of ALDI that are required to
develop innovation. Therefore various phases of innovation are as follows:
Fluid stage: It stage where uncertainty related to market condition and technology that need to
be used by firm to satisfy need of customers. ALDI has high skilled, knowledgeable, qualified
employees and effective equipments to manufacture qualitative products and services to attract
large number of customers. ALDI continuous innovative its products and use patent, trademark
to protect itself from new entrance for long term growth and success of organisation
(Dimitrieska, 2016). Company has flexible organisational structure that helps in adopting various
changes as per requirement of environmental condition. It has manufacture different design
products, choose appropriate channel to distribute products and add continuous value to retain
maximum customer’s satisfaction.
Transitional phase: As ALDI expand its operation it is able to get to know about recent trends
and preference of customers therefore it is able to manufacture standardise products and services.
Market share and customer preference regarding various products and services of ALDI start
growing that helps in expansion and growth of organisation. ALDI has manufacture different and
innovative products design, marketing plan and maintain its quality of products in order to gain
competitive positioning. ALDI innovative and dominate products design helps in attracting new
as well as existing customer to prefer company product over another.
Specific phase: At this stage customer tend to compare products of ALDI on basis of
performance in term of quality and price of products. ALDI has timely formulated strategy to
target specific customers for particular products and services of firm. It has high skilled,
knowledgeable employees that are highly motivated and dedicated to work hard for render
qualitative products to customers (Affran, Mawuko and Oduro, 2019). At this stage ALDI has to
invest in its research and development department so that it can introduce highly innovative
products and improve its product quality, bring economic of scale. Therefore it will promote
sustainability and survival of organisation in the industry and achievement of goals.
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SWOT Analysis
Swot analysis is used to identify internal strength and capabilities of firm that helps it to
gain competitive advantages through effective utilisation of available opportunities. It also helps
in finding out weakness of firm that need to be removed for growth and sustainability of
organisation for long period of time. Swot analysis of ALDI is done below that helps in
formulation of effective strategy and achievements of goals such as:
Strength: High reputation and strong brand image to offer innovative and quality products is
one of the strength of ALDI that helps in gaining maximum market share in the industry. Highly
skilled and trained employees provide qualitative services to customers thus enhance market
share and sales volume of company (Waheed and et.al, 2018). Use of innovative technology to
deliver service to customer within limited time period helps in making customers happy and
satisfied. Such strength helps ADLI in gaining competitive advantages and expansion of business
across worldwide.
Weakness: Company is highly depended on highly skilled employees and supplier that lead may
affect operation of company in longer run. Therefore it needs to formulate effective strategies to
removes such weakness and expand its business.
Opportunity: Innovation and use of recent technology in manufacturing and delivering of
services to customers is essential as it helps in effective utilisation of available opportunity.
ALDI can expand its business operation across various countries to satisfy need of number of
customers and maximise its share of profitability. Effective and innovative marketing strategy
such as use of social media and increase presence in social website provide ease and comfort to
customer (Pappas and et.al., 2016). At the same time helps in attracting new as well as existing
customer to make purchase of ADLI products as compared to other competitors in the market
such as Big W. Identifying recent trend in technology and preference of customer staying in
Australia will helps ALDI to gain competitive advantages and maximum market share.
Threats: Globalisation and digitalisation has increase competition level in retail industry thus
ALDI has to face large competition from number of company while operating its function. ALDI
need to continuous manufacture qualitative products in order to protect itself from threats of high
competition to grow and survive in market.
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Mind map that can be used by firm to regain strategic position
These are various strategies that can be used by ALDI to gain strategic positioning in the
market and satisfy needs of customers to earn large amount of profitability (Scott, 2019).
CONCLUSION
From the above report it can be concluded that various strategic models helps in evaluating
market condition that impact on organisation performance and formulating of effective strategy
that can be used to get maximum output. It can also be concluded from porter analysis that
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Innovation in
technology to
meet unsatisfied
need of people
Recruitment of
highly skilled and
qualified
employees in the
firm
Analysis
performance and
productivity of
competitors in the
market
Satisfy need of
stakeholder for
effective
performance of
business.
Expansion of
business across
different nation
Creation on own
website to offer
wide varieties of
products though
online sites
Use of social
media to market
products and
services of ALDI
Strategy that can be
used by ALDI to
gain competitive
positioning

despite consumer has high power company is able to expand its market share by producing
qualitative products. At last it can be explained that technology innovation is necessary for
effective operation of business and satisfaction of customer needs.
REFERENCES
Books and journals
Affran, S., Mawuko, D. and Oduro, R., 2019. Relationship Marketing: A Strategic Tool For
Sustainable Competitive Advantage. GIS Business, 14(3). pp.54-65.
Bayraktar, C. A. and et.al., 2017. Competitive strategies, innovation, and firm performance: an
empirical study in a developing economy environment. Technology Analysis &
Strategic Management, 29(1). pp.38-52.
Dimitrieska, S., 2016. How to gain competitive advantage in the
marketplace. Entrepreneurship, 4(1), pp.116-126.
Ghauri, P and et.al., 2016. Market driving strategies: Beyond localization. Journal of Business
Research, 69(12). pp.5682-5693.
Krystofik, M. and Gaustad, G., 2018. Tying product reuse into tying arrangements to achieve
competitive advantage and environmental improvement. Resources, Conservation and
Recycling, 135. pp.235-245.
Pappas, I. O and et.al., 2016, July. Social media and analytics for competitive performance: a
conceptual research framework. In International Conference on Business Information
Systems (pp. 209-218). Springer, Cham.
Rowe, J.E . and McLaren, D., 2017. Exploring competitive advantage in a regional community
context. Australasian Journal of Regional Studies, The, 23(2). p.152.
Samad, S., 2018. Examining the effects of environmental strategy and competitive advantage on
business performance. Management Science Letters, 8(9). pp.891-902.
Scott, D. A., 2019. Enhancing the Competitive Advantage of US Corporations by Incorporating a
Foreign Trade Zones Strategy.
Waheed, A and et.al., 2018. How Market Orientation Helps to Gain Competitive Advantages in
New Product Offering. IJAMEE.
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