Business Environment Analysis and Strategy Report for ARU Cambridge

This report provides a comprehensive analysis of the UK food retailing industry, examining the competitive forces at play, including an analysis of Tesco and Sainsbury's using Porter's Five Forces. It delves into the competition dynamics in Mill Road and the ARU campus in Cambridge. The report compares the strategic resources and capabilities of independent food shops near the ARU campus and in Mill Road, utilizing the VRIN model for competitive advantage assessment. Furthermore, it includes a stakeholder analysis for the Cambridgeshire Fire and Rescue Service, identifying key stakeholder relationships and their importance. The report also analyzes the strategic changes undertaken by Sainsbury's, assessing the motivations behind these changes. The report concludes with a summary of key findings and recommendations.

Business Environment
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Table of Contents
1. Introduction............................................................................................................................2
2. Business Environment............................................................................................................3
2.1 Analyse the competitive forces in the food retailing industry.........................................3
2.2 Explanation of the competition in food retailing which exists on Mill Road and in the
ARU in Cambridge................................................................................................................5
3. Strategic Resources & Capabilities........................................................................................5
3.1 Comparison between the resources and capabilities of the independent food shops near
the ARU Campus in Cambridge and in the Mill Road..........................................................5
3.2 Usage of the VRIN model................................................................................................7
4. Stakeholders.........................................................................................................................12
4.1 Prepare a stakeholder analysis for the Cambridgeshire Fire and Rescue Service..........12
4.2 Identify two or three stakeholder relationships you consider are particularly important
for the service.......................................................................................................................17
5. Business and Corporate Strategies.......................................................................................18
5.1 Analyse the change in the scope of Sainsbury’s as a corporate entity...........................18
5.2 Assess the motivation for this acquisition......................................................................18
6. Conclusion............................................................................................................................19
References................................................................................................................................20
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1. Introduction
The main motive and the objective of the study is to describe the condition of the external
market scenario of the food industry in the United Kingdom. In the first part of the study, the
competitive forces of the large organization or the small business corporations have been
described. In this study, the Tesco and the Sainsbury Plc have been taken as the two
organizations of the food retailing industry of the United Kingdom. Moreover, the
competition in the Mill Road and in the ARU campus of the Cambridge have been discussed
with the help of the table. A VRIN analysis also has been presented for representing the
competition between the chosen organizations with the other large companies and the small
food retailing organizations of the United Kingdom (Apăvăloaie 2014).
In the latter part of the study, a stakeholder analysis has been developed and represented in
the study for the Cambridgeshire Fire and Rescue Service. Along with the core preparation of
the stakeholder's analysis, the relationships among the stakeholders has also been described
for the Cambridgeshire Fire and Rescue Service. Moreover, there are some of the
recommendations that have also been given for the managers to maintain the long term
relationships with the managers.
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2. Business Environment
2.1 Analyse the competitive forces in the food retailing industry
In this section the competitive forces in the food retailing industry of the United Kingdom has
been discussed. Among the small independents and the large organizations of the retailing
industry, the Sainsbury PLC and the Tesco are one of the largest organizations of the country
and the core competitive forces of the industry has been determined with the help of the
Porter's five forces analysis.
Threats from the new entrants in the market: In case of the new entrants in the retailing
market of the United Kingdom, it can be further observed that there are many prominent
countries in the country and they have exceeded the market barriers in the recent years. Thus,
due to this particular reasons, the existing market giants have discouraged the new entrants
for entering into the retailing market of the country. On the other hand, it can be noticed that
the presence of the Tesco and the Sainsbury Plc has reduced the ratio and the percentage of
the new market entry of the retailing organization in the United Kingdom (Bah and Fang
2015).
Threats of the substitutes: In case of the threats of the substitutes, it can be further observed
that the percentage of the threat is considerably high as there are many large companies as
well as the small organizations are present in the retailing industry. It can be noted that in
case of the large organizations like Tesco and the Sainsbury Plc, the threats of the substitutes
is much low as they offer unique products to the customers and in a diverse price range.
However in case of the small organizations in the retailing industry, the threats of the
substitutes is considerably high as they offer same kind of product in inferior quality and in
the low price at the same point of time (Botha et al. 2014).
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Bargaining power of the suppliers: Considering the large organizations as well as the small
independent companies of the retailing industry of the United Kingdom, it can be observed
that the bargaining power of the suppliers is high as there is many organizations in the market
and they offer different price quotations from different business corporations (Law et al.
2015).
Bargaining power of the buyers: In the retailing industry of the United Kingdom, the
bargaining power of the buyers is considerably high as the buyers or the consumers of the
market has the option to shift from one store to another store if they will not feel happy with
the product and the price quotations of one organization (Menychtas et al. 2014).
Competitive Rivalry: In the retailing industry of the United Kingdom, it can be further
observed that the competitive rivalry within the large organizations like Tesco and the
Sainsbury Plc is considerably high. On the other hand, it can be further observed that the
competitive rivalry within the small independent companies of the country is considerably
low in the present external market scenario.
Figure 1: Porter's Five Forces of the food retailing organizations in United Kingdom
(Sources: Chenchehene and Mensah 2015)
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2.2 Explanation of the competition in food retailing which exists on Mill Road and in the
ARU in Cambridge
It can be further opted that there is a high competition of the food institutions or the
organizations present in the Mill Road and in the ARU in Cambridge. There are two retailing
supermarket stores of Tesco and Sainsbury Plc in the Mill Road and in the ARU in
Cambridge and that is why there have been a sheer competition between these two
organizations. It can be further observed that in the Tesco supermarket store in the Mill road,
the customer attraction is more because in that area, many new people are the regular buyers
and they get attracted to the quality of products and services delivered by Tesco (Moroni et
al. 2015). On the other hand, the Sainsbury Plc has also increased their volume of customers
by 2.3 per cent within one fiscal year, whereas Tesco Plc has increased their customer base
by 3.9 per cent from the supermarket located in the Mill road. It can be further recognized
that the Sainsbury Plc supermarket in the ARU in Cambridge has mainly attracted the
teenagers and the college students by keeping a variety of goods and services of their choice
(Cheung 2014).
3. Strategic Resources & Capabilities
3.1 Comparison between the resources and capabilities of the independent food shops
near the ARU Campus in Cambridge and in the Mill Road
It has been discussed earlier that in the ARU Campus in Cambridge, the supermarket food
store of the Sainsbury Plc is located and near the Mill Road, the supermarket of the Tesco has
been located. A brief comparison on their internal resources and capabilities have been
described in the table below
Features Tesco Sainsbury Plc
Products and Services The Tesco has been one of The Sainsbury Plc has been
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the largest food retailers of
the United Kingdom and they
provide the best quality of
the frozen and the fresh
foods, baby milk and
powders to the customers
the second largest food
retailers of the industry and
they deliver the most fresh
foods in the packaged
groceries like tea and sugar
to the customers
Resources and Strength In the Mill road, Tesco has
developed their supermarket
comprising of 17,200 square
meter area with the separate
parking areas for the
customers. The main
resource of the organization
has been their employees.
The total number of
employees in the shop near
the Mill road is near about
2000, who are much devoted
to the organization
In the ARU Campus of
Cambridge, the Sainsbury plc
has developed their shop
with 15296 square meters
and within the past few
months they have attracted
more customers than Tesco
by delivering more varieties
of food products than all
other organizations in the
country. The total number of
strength in the shop is near
about 1500.
Capability In case of the core
capabilities of the
organization, it can be
observed that the trust and
the goodwill of the business
corporation among the
In the ARU Campus of
Cambridge, the main
capability of the business
corporation has been to
deliver the best quality of
food products to the
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consumers around the Mill
road has been one of their
core capabilities.
consumers so that the
customer can value for
money
Major Strength The major strength of the
Tesco in the shop near Mill
road is driving the top lines
of the business enterprise and
thus capturing the core
development and the growth
of the retailing market of the
country.
The major strength of the
Sainsbury Plc has been to
secure the highest scale and
the limit of the customer
service by delivering all the
best quality products to the
customers. On the other
hand, the organization also
delivered full assistance to
the customers in case of
eating healthy foods and also
in the field of shopping.
Table 1: Comparison between the resources and capabilities of the independent food
shops
(Source: Clarke et al. 2016)
3.2 Usage of the VRIN model.
The usage of the VRIN model has been explained, which is based on the struggle in the
competition with the other local organizations and the supermarkets of the area.
Resourced Valuable Rare Imitable Non-
Sustainable
Competitive
advantages
The flexibility Yes Yes It can be Yes Sustainable
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of the supply
chain
networking
observed that
the large
organizations
like Tesco
and the Plc
have same
kind of
supply chain
networking
flexibilities.
However, the
local
organizations
of the
country have
less number
of suppliers
and they have
been trying to
improve their
supply chain
just like the
large food
retailers in
the external
competitive
advantage
has been
achieved
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market
phenomenon.
The specific
kinds of the
opportunities
and the
industries that
are adjacent to
the requirement
of the new
industries
The creation
and the
development
of the new
revenue
streams by
Tesco and
Sainsbury Plc
can be very
valuable
No It is purely
imitable by
the core
competitors
of the
external
market
scenario
Yes Sustainable
competitive
advantage
can be
pursued and
achieved
The
manufacturing
retail pricing of
the products
and services
Yes No It can be
further
observed that
the pricing
and the
quotations
are regularly
imitated by
the other
organizations
of the
industry
Yes The
competitive
advantage
has been
achieved
The cost of the In case of the No It can also be Yes, the Medium and
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distribution,
logistics and
the
competitiveness
Tesco and
Sainsbury Plc,
the delivery
cost of the
organization
has been
lowered
imitated by
the core
competitors
and the
rivalries of
the external
market
phenomenon
Tesco and
Sainsbury Plc
have
initialized for
the pricing
analytics
engine
the long term
Competitive
Advantage
can be
achieved
The chances
and the core
opportunities
related with the
brand
awareness and
the extensions
Yes, it can be
possible due to
the entry of the
new niches in
the market
No It can also be
imitated by
the core
competitors
and the
rivalries of
the external
market
phenomenon
Yes Medium and
the
temporary
competitive
advantage
has been
achieved
The local and
the global
presence of the
Tesco and
Sainsbury Plc
Yes, however
on the other
hand, it can be
observed that
diversifications
of the revenue
streams and
the isolation of
Yes It can be
purely
imitable by
the core
competitors
of the
external
market
Yes, it can be
recognized
that Tesco
and
Sainsbury Plc
have been
one of the
most
Strong
competitive
advantage
can be
achieved
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the core
balance sheet
of the
company from
the financial
cycles
scenario diversified
organizations
in the food
retailing
industry in
the country
The prior
economical and
the financial
resources of the
Tesco and
Sainsbury Plc
Yes No It can be
further
observed and
noted that the
market
liquidity and
the financial
instruments
are also
available to
the nearer
suppliers and
the
distributors
No Temporary
competitive
advantage
can be
achieved
Table 2: VRIN Analysis of the struggle in the competition with the other local
organizations
(Source: Downie 2018)
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4. Stakeholders
4.1 Prepare a stakeholder analysis for the Cambridgeshire Fire and Rescue Service.
In case of the Cambridgeshire Fire and Rescue Service, it can be further observed that there
are four stakeholders that have been identified. The four stakeholders for the organization are
human resource management officials, the local citizens of the Lancashire, the older people
of the BME communities and the training or voluntary associations of the business
organizations.
Stakeho
lders
Intern
al
External Power Interest Satisfacti
on
level
Closely
manage
d
Strategy
for
engaging
the
stakehol
ders
The
officials
of the
human
resource
manage
ment
Internal
stakeho
lders
It is much
understoo
d that the
managem
ent
officials
of the
Cambridg
eshire
Fire and
Rescue
The
officials
of the
human
resource
managem
ent team
has also
high
interests
towards
It can be
further
observed
that the
motivatio
nal level
or the
degree of
the
motivatio
n and
It can
be
underst
ood that
the
manage
rs of the
organiz
ation is
closely
manage
Conflict
Resolutio
n Strategy
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Service
has high
power
and
responsib
ility
the
Cambridg
eshire
Fire and
Rescue
Service
satisfactio
n of
Cambridg
eshire
Fire and
Rescue
Service is
much low
d and
they
have
high
level of
engage
ment
The core
resident
s and
the
citizens
of the
Lancash
ire
External
stakehold
ers of the
organizati
on
The
residents
and the
citizens
of the
Lancashir
e have a
high
power
over the
Cambridg
eshire
Fire and
Rescue
Service
It can be
observed
that the
residents
have a
low
interest
over the
activities
of the
organizati
on
Low
satisfactio
n and the
motivatio
nal level
They
have
the high
frequen
cy with
the
organiz
ation,
relation
ship
building
strategi
es,
behavio
ral
changes
, closely
Communi
cation
Strategy
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monitor
ed and
accessib
le
informa
tion
Elder
people
of the
BME
commun
ities
External
stakehold
ers of the
Cambridg
eshire
Fire and
Rescue
Service
The older
people of
the BME
communit
ies have
been
effectivel
y
engaged
with the
risks and
advantage
s of the
organizati
on
The
interests
of the
elder
people of
the BME
communit
ies is high
High
satisfactio
n and the
motivatio
nal level
They
have
the high
frequen
cy with
the
organiz
ation,
relation
ship
building
strategi
es,
behavio
ral
changes
, closely
monitor
ed and
Negotiati
on
Strategy
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accessib
le
informa
tion
Commu
nity
groups
and the
voluntar
y
organiza
tions
related
with the
organiza
tion
Internal
stakeho
lders
The
training
coordinat
ors and
the
voluntary
group
people
have been
effectivel
y
engaged
with the
risks and
advantage
s of the
organizati
on
The
interests
of the
elder
people of
the
training
coordinat
ors and
the
voluntary
group
people is
high
Low
satisfactio
n and the
motivatio
nal level
In case
of the
core
engage
ment of
the
stakehol
ders
with the
organiz
ation, it
can be
noticed
that
they
have
reduced
the
frequen
cy that
are
Motivatio
n Strategy
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related
with the
awarene
ss. The
practice
to gain
the
accessib
le
informa
tion
have
been
also
attached
with the
stakehol
ders
Table 3: Stakeholders engagement analysis matrix of the Cambridgeshire Fire and
Rescue Service
(Source: Georgescu and Popescul 2015)
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4.2 Identify two or three stakeholder relationships you consider are particularly
important for the service.
In the scenario of the relationships between the two and three stakeholders, it can be observed
that there is a healthy relationship between the human resource management team and the
older members of the BME communities in the Lancashire (Murphy and Greenhalgh 2018). It
is because the BME communities have been one of the oldest communities of the city and the
Cambridgeshire Fire and Rescue Service is also one of the most prestigious fire service
corporations in the city. Moreover, it can be further observed that the Cambridgeshire Fire
and Rescue Service is one of the oldest and the prestigious organizations and they have been
serving for the citizens for many years. Thus the human resource management team officials
have been much obliged to maintain good relationships with the dwellers of the Lancashire,
older members and the officials of the BME communities.
Recommendations for the Managers
It can be further observed that a brief suggestion has been presented for the managers below
 The managers of the Cambridgeshire Fire and Rescue Service, should be more prompt
in taking the emergency actions within the city of the Lancashire and thus helping the
members of the BME communities (Murphy and Greenhalgh 2015).
 On the other hand, the managers also should pay good remuneration to the voluntary
workers and the training personals as they are main part of the Cambridgeshire Fire
and Rescue Service (Kincaid 2018).
 The managers also should conduct a survey in the Lancashire for the core
improvement of the products and services (Kljucnikov et al. 2015).
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5. Business and Corporate Strategies
5.1 Analyse the change in the scope of Sainsbury’s as a corporate entity
The change within the Sainsbury Plc has been recognised after the corporate entry and the
acquisition of the Home Group retails or the Argos. In the recent years, it has been further
observed that the Sainsbury Plc has reached to the profit maximization of £1.3 billion after
they have entered into the corporate market in between the Argos chain. Furthermore, it can
be noted that after the acquisition of the Argos chain, the Sainsbury Plc has strengthened their
online retail chains and the home delivery market scenarios.
5.2 Assess the motivation for this acquisition
In the recent years, the Sainsbury Plc has been motivated due to the high profit maximization
within a limited time span. It can be recognized that after the acquisition of the Argos,
consumer credit business of the Sainsbury Plc has been increased by £500 million in cash and
thus they have covered more than £450 million in the cash cost. On the other hand, it can be
noticed that the business organizations have also stepped over to monitor their 800 stores in
the catalogue chain worldwide.
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6. Conclusion
It can be concluded that in this study, the business environment and the competition between
the Tesco or Sainsbury Plc and large or small food retailing organizations of the United
Kingdom has been presented with the help of analysing the competitive forces. In the latter
part of the stakeholders’ analysis of the Cambridgeshire Fire and Rescue Service has been
provided, along with some of the recommendations for the managers, which they should
follow for maintaining a long term relationship with the stakeholders of the organization. It
can be further observed that the core analysis of the change in the scope of Sainsbury’s as a
corporate entity which has been followed till the acquisition of Home Retail Group (Argos)
has been discussed in the study along with a description about the core motivational standards
for the acquisition.
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