Management Consultancy Report: Aldi's US Expansion Strategy Analysis

This report provides a comprehensive analysis of Aldi's proposed expansion into the US market. It begins with an overview of Aldi's current global presence and identifies the business problems and challenges associated with entering new markets, including competition, team building, and management. The report then outlines a consultancy strategy, including the selection of an expert consultancy model and the resources required. A detailed timeline is presented, breaking down the project into phases and tasks. The scope and target of the consultancy are defined, with a focus on whether Aldi should expand into the US. The report also identifies potential risks, such as financial and technical risks, and proposes mitigating strategies. The conclusion summarizes the key findings and recommendations, emphasizing the importance of consultancy in managing business expansion. The report reflects on the need for market analysis before entering the new market. The report recommends the use of expert consultancy to provide the best guidance.

MANAGEMENT
CONSULTANCY IN A
GLOBAL ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
DESCRIPTION OF A FIRM CONTEXT ALONG WITH BUSINESS PROBLEMS..................1
THE CONSULTANCY STRATEGY.............................................................................................2
Type of consultancy model..........................................................................................................2
Resources.....................................................................................................................................3
Timeline.......................................................................................................................................4
Scope and target...........................................................................................................................6
Deliverable...................................................................................................................................6
Risk..............................................................................................................................................6
CONCLUSION................................................................................................................................7
SELF- REFLECTION REPORT.....................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Management consultancy is defined as the practice of assisting company in improving
their performance. This will assist company in managing their performance and improving
market position. The present report is based on company Aldi which is a supermarket chain and
wants to expand its operations in some parts of US. For this whole management consultancy, the
advice will be given to Aldi that whether they need to expand their business or not.
DESCRIPTION OF A FIRM CONTEXT ALONG WITH BUSINESS
PROBLEMS
Aldi is one of the top supermarket who deal at retail sector. Currently the firm has over
10,000 stores within 20 countries that reflects it has a brand image at international level. In
1945, the owner of a firm established a food shop and soon opened another retail outlet nearby.
Initially, the company faces many problems which includes legal issues, political instability etc.
But, with proper support from their families, company is able to expand its business at
international market. Such that in 1967, Aldi acquired a grocery chain Hofer in Austria and then
opened next store abroad in Netherlands. Further, company established its many outlets at
different locations because of having strong management team and also uses innovative ideas
within a business in order to attract range of customers. Similarly, quoted firm has also increased
its business during last two years and this is possible with excellent work of their management
team.
Therefore, having a brand image and strong financial performance at global level,
company is expanding its business which is named as ‘coast to coast expansion’. This involves
expanding its business operations in Arizona, California, Florida and Northeast within US (Aldi
to open 100 new stores, add 500 curbside pickup sites in 2021, 2021). Currently, there are many
cities where company is operating its unit but now it offerings different products in new market
with an aim to become a leader at global level. Hence, the objectives of company reflect that
Aldi is going to expand its business by opening new branches at Northeast, Florida, California
and Arizona so there is a need to increase the fixed cost by 25% within next year. Moreover,
company is not only operating at large countries but it has established over small cities so that it
meets the need of customers easily.
To operate within new country, company may face many challenges which includes
external or internal issues. Apart from this, language error is also considered another challenge
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faced by Aldi, as headquarter of a firm is in UK and now to operate in other four countries
where different people speak in different language. So, it also affects the business performance
in adverse manner. Also, company have to conduct effective market analysis before entering
into new market and to solve many problems, company contact with consultancy company in
order to generate appropriate solutions. Thus, there are many problems which might be faced by
Aldi and some of them are as mentioned below:
Hiring employees and team building: In order to establish new business at four different
countries, it is essential for the firm to recruit employees who have strong capabilities in order to
manage the work appropriately (Sturdy, 2018). Also, sometime company delays in finding right
personnel because of new environment. Apart from this, it is not easy for Aldi to build a team
because individuals face adjustment issues, as they are not comfortable with different people
who belongs to various culture.
Competitors: It does not matter how great company offer the products at market, but
with the changing era it is essential for the business to conduct a deep study about their outer
market and analyzed the need of customers. Further, offer products accordingly which in turn
assists to make brand unique and different from others. For that, company have to establish right
strategy that helps to identify the actual competitor market so that company establish its brand
image at all the four countries.
Poor management: during start up, management team also faces struggles and this lead
to affect the sales as well. This is pertaining to the fact that when company will expand its
business operation in order country then they will require effective management. In addition to
this all the four countries have different types of management and Aldi need to focus on this for
proper expansion of store in these countries.
THE CONSULTANCY STRATEGY
Type of consultancy model
For any work to be accomplished there is requirement of consultancy from some person
or organization which is expert in that particular field. Consultancy method is a type of activity
which assist company in seeking help and advice relating to area in which company is intending
changes (Sharma and Soederberg, 2020). In case of Aldi company, it is planning to expand its
operation in US market and for this they will be requiring advice. Hence, for this there are two
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consultancy decision which they can select in order to have proper knowledge relating to
expansion in US. These method involves expert consultancy and process consultancy planning.
The expert consultancy is a system in which Aldi contact an expert who deals in business
expansion only. This will assist company in getting expert advice from the people who
continuously deal in expansion of business. on the other side process consultancy planning
means hiring a third person who evaluates process of company that is whether they are operating
in proper and effective manner or not (Sovacool and et.al., 2017). This in turn will help Aldi in
identifying the flaws within the process which company follows in order to meet their
requirement. For expansion of Aldi in US market use of expert consultancy will be done. The
reason underlying selection of expert advice is that this will provide better and effective advice
to viability of this idea of expansion.
Resources
For this consultancy advice, Aldi will have to arrange for many of the resources which
will assist these expert people in providing their services. The first and foremost thing required
by expert is data relating to the problem or issue on which they have to provide expert advice.
Hence, in case of Aldi, they want to expand their business operation in four areas of US and for
this expert consultancy will make use of data relating to supermarkets in US. This is necessary
as with help of this data expert, will analyse the trends among already established supermarket
and how well they are operating. This is essential as this will help Aldi in making their strategies
while entering these markets. In addition to this it will also require some human resource both
from the company that is Aldi and their own consultancy firm. This is pertaining to the reason
that with help of their own team the expert will evaluate data and assist human resource of Aldi
that whether they should expand their business in US or not.
Along with this it will require a team of five people which will include two members of
company and three of consultancy company. from Aldi two managers will be called who are
responsible in management of expansion. From consultancy firm a manager, one data analytic
manager and one assistant manager will be present (Salim and et.al., 2018). The reason for this
is that data analytic will assist in analysing trends from the data and will communicate to
managers of Aldi. In addition to this it is also necessary that employees of consultancy firm have
all the necessary skills required. These skills involve a combination of numeracy skill,
communication skill, interpersonal, team work, problem solving and other related skills.
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Timeline
Task
Mode Task Name Duration Start Finish Predecessors
Auto
Scheduled Project initiation 31 days Mon
2/22/21
Mon
4/5/21
Auto
Scheduled
Generating idea relating to business
expansion 8 days Mon
2/22/21
Wed
3/3/21
Auto
Scheduled Checking idea feasibility 8 days Thu
3/4/21
Mon
3/15/21 2
Auto
Scheduled Developing team 3 days Tue
3/16/21
Thu
3/18/21 3
Auto
Scheduled Identifying main stakeholders 7 days Fri
3/19/21
Mon
3/29/21 3,4
Auto
Scheduled Brief outlining of project 5 days Tue
3/30/21
Mon
4/5/21 5
Auto
Scheduled Project planning 18 days Tue
4/6/21
Thu
4/29/21
Auto
Scheduled Setting up objective of plan 2 days Tue 4/6/21 Wed
4/7/21 6,2
Auto
Scheduled Developing milestone for plan 4 days Thu
4/8/21
Tue
4/13/21 8
Auto
Scheduled Selecting different resources 7 days Wed
4/14/21
Thu
4/22/21 9
Auto
Scheduled Making a communication plan 5 days Fri
4/23/21
Thu
4/29/21 10
Auto
Scheduled Project execution 18 days Fri
4/30/21
Tue
5/25/21
Auto
Scheduled Allocation of different resources 5 days Fri
4/30/21
Thu
5/6/21 11
Auto
Scheduled
Allocating responsibilities to
employees 4 days Fri 5/7/21 Wed
5/12/21 13
Auto
Scheduled
Installing various software and
technology relating to business
development
9 days Thu
5/13/21
Tue
5/25/21 14
Auto
Scheduled Project monitoring 15 days Wed
5/26/21
Tue
6/15/21
Auto
Scheduled
Monitoring implementation of
business activity within new country 5 days Wed
5/26/21 Tue 6/1/21 15
Auto
Scheduled Tracking cost of implementation 6 days Wed
6/2/21
Wed
6/9/21 17
Auto
Scheduled
Monitoring performance of all
business activities 4 days Thu
6/10/21
Tue
6/15/21 18
Auto Project closure 4 days Wed Mon
4

Scheduled 6/16/21 6/21/21
Auto
Scheduled Closing out the project 4 days Wed
6/16/21
Mon
6/21/21 19
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Scope and target
The scope of this consultant project involves engagement of company with the firm in
order to seek advice from the firm. The consultancy firm is using the data of US supermarket
and this is because of the reason that it will assist company in giving advice to Aldi. The major
reason underlying this fact is that when the company will inculcate the analysis of past data and
trends relating to supermarket chain in US. This will assist Aldi in managing its operations and
this will also assist other companies in complying with all these strategies.
Deliverable
The major deliverable of this consultancy project is the fact that whether Aldi must
expand its business in US region including area like Florida, California, Northeast and Arizona.
This is the major problem or the deliverable for which Aldi went for consultancy by undertaking
expert consultancy was to seek advice relating to its expansion (Lonsdale and et.al., 2017).
Hence, this was the only reason for which company went for consultancy and this resulted in
final answer that the expansion of business is advisable and beneficial for company. the reason
pertaining to the fact is that when the company will expand then it will increase it operational
efficiency.
Risk
This is defined as the risk which company might face at time of undertaking any change
or implementing any strategy within the business (Stone and Moloney, eds., 2019). In the
present case Aldi is planning to expand its operations in US market and for this it is essential
that company has knowledge relating to all possible risk which they will encounter in case of
expansion. The possible risk and their mitigating strategies by consultant are as follows-
Risk Impact Mitigating strategy
Financial risk- this is a risk
which might include the risk
relating to money.
High The mitigating strategy for
this risk is to analyse
requirement of finance in
every activity of business and
then comparing different
sources of finance. This will
provide a better alternate for
company to arrange finance.
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Technical risk- it is a risk
which involves changes in
technology and related aspect
which company is not
complying with.
Medium In order to mitigate technical
risk, Aldi must before enter in
US market must research
relating to latest technology
which is prevalent there. This
will assist company in
analysing their position in
respect to technology being
used by them.
CONCLUSION
The above report summarised that consultancy is very essential for the business in its
proper management of business and its proper management. For communicating the result or
summary of expert consultancy they have taken help of meeting for sharing information relating
to expansion plan of company. With the help of the above study it is clear that it is beneficial for
Aldi to undertake the plan of expansion of business in US market. Further it was evaluated that
in early years after expansion the profits of company may be low because of the new set up. But
as the business will get established it will increase profitability of company to a great extent. In
addition to this if Aldi faces any of the problem then they can again reach back to the
consultancy firm for assistance.
SELF- REFLECTION REPORT
By referring to consultancy project of Aldi it was analysed that for business it is essential
to consult all the decision with respect to its growth and development. With help of this I learnt
that the use of consulting is very essential. This is pertaining to the reason that in consulting a
business can seek advice for growth and development of the business. In addition to this with
help of the whole report I evaluated that business developmental activities are very important for
the business. the reason underlying this fact is that business cannot be static and for this is
essential for business to undertake activities which involves growth and development. With help
of this project I learnt that the business development activities are the one which extend across
different types of department and try to develop them as this will result in better and effective
development of overall business (Tuczek, Castka and Wakolbinger, 2018).
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Furthermore, I learnt that the use of different skills and attributes are essential for the
person to grow and develop themselves. This is pertaining to the reason that for managing the
whole business it is essential that managers and decision makers are having all the required
skills and attributes. The most essential skills which need to be inherited by the managers for
business development is creativity, communication, analytical, negotiation, organizational,
innovation and many other different types of skills. When a person involves all the different set
of skills and along with this it requires market research, analysis of competitors as well.
Furthermore, effective time management is also a major skill that need to be inherited in
me. The reason underlying this fact is that when I will not be able to complete task on time then
this will affect my working efficiency. This is pertaining to the reason that when I will not be in
position to complete the work on time then company will not allot me any responsibility. The
reason being that I am not in position of completing my assigned duty on time. In addition to
this, team work and coordination skills are also necessary. In the corporate world, no person can
work in isolation and because of this it is essential that I inherit good and effective team working
skills. This is necessary so that I can work in better and effective manner with other employees
of the company.
On the other side, with help of this study it was also evaluated that researching skills are
also very essential to be possessed. The reason behind this is that there are many frequent
changes taking place in business environment and requirement of consumer (Hosseini and et.al.,
2019). Hence, if company will not comply with all these activities then it might result in
consumer not liking the product and services. Hence, for this it is essential that there is proper
and effective market research skill in me. This will assist me in finding out the recent changes
and trends going in present working environment. Hence, after evaluation of these changes,
these will be implemented within the business and it will run in accordance with the resent
changes.
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REFERENCES
Books and Journals
Hosseini, S.M., and et.al., 2019. Assessment of sustainable groundwater resources management
using integrated environmental index: Case studies across Iran. Science of the total
environment, 676, pp.792-810.
Lonsdale, C., and et.al., 2017. Knowing the price of everything? Exploring the impact of
increased procurement professional involvement on management consultancy
purchasing. Industrial Marketing Management, 65, pp.157-167.
Salim, H.K., and et.al., 2018. An investigation of the drivers, barriers, and incentives for
environmental management systems in the Malaysian food and beverage industry.
Clean Technologies and Environmental Policy, 20(3), pp.529-538.
Sharma, S. and Soederberg, S., 2020. Redesigning the business of development: the case of the
World Economic Forum and global risk management. Review of International
Political Economy, 27(4), pp.828-854.
Sovacool, B.K., and et.al., 2017. Political economy, poverty, and polycentrism in the global
environment facility’s least developed countries fund (LDCF) for climate change
adaptation. Third World Quarterly, 38(6), pp.1249-1271.
Stone, D. and Moloney, K. eds., 2019. The Oxford handbook of global policy and transnational
administration. Oxford University Press.
Sturdy, A., 2018. Promoting solutions and co-constructing problems–Management consultancy
and instrument constituencies. Policy and Society, 37(1), pp.74-89.
Tuczek, F., Castka, P. and Wakolbinger, T., 2018. A review of management theories in the
context of quality, environmental and social responsibility voluntary standards.
Journal of cleaner production, 176, pp.399-416.
Online
Aldi to open 100 new stores, add 500 curbside pickup sites in 2021. 2021. [Online]. Available
through: < https://www.supermarketnews.com/retail-financial/aldi-open-100-new-
stores-add-500-curbside-pickup-sites-2021 >
<><https://ohiostate.pressbooks.pub/drivechange/chapter/chapter-1/>.
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