Competitive Business Strategy: Australian Supermarkets Analysis

This presentation analyzes the business strategies of Australian supermarkets, focusing on Coles and Woolworths, and their response to competition from Aldi. It identifies key strategic issues such as threats from new market entrants and marketing strategy weaknesses. Different strategic models, including Porter’s five generic strategies (cost leadership, differentiation, focused, and integrated strategies), are explored to mitigate these issues. The presentation recommends increased investment in research and development, offering high-quality products at low prices, and implementing suitable business strategies to improve sales and brand image. The conclusion summarizes the concepts of various business strategies, potential threats in the Australian market, market positions of Coles, Woolworths, and Aldi, strategy formulation and implementation, and relevant recommendations. Desklib provides access to similar solved assignments and study resources for students.

Business Strategy
of
Australian
Supermarkets

Table of contents:
• Slide 3: Introduction
• Slide 4-14: Discussion
• Slide 15: Conclusion
• Slide 16: References

Introduction
• Currently all business organizations
implement strategies to improve
business
• Strategies help to gain competitive
advantages
• Business strategies are a set of
commitments to improve structural
and financial position
• Business strategies help to manage
competition
• Influences the business performance

Discussion
• Background of Australian Supermarkets
• The number of supermarkets in Australia are increasing with the increase in
public demand
• Market is very competitive
• The most dominant supermarkets of the country: Coles and Woolworths
• Dominant supermarkets faced competition from Aldi, a German organization
(new entrant in Australia)
• Aldi provides high quality products to customers
• Aldi increases the amounts of competition
• Aldi captured a huge share in the Australian market

Identification of Key strategic
Issues
• Threats from new entrants in the
market (Aldi posed threat to Coles and
Woolsworth)
• Woolsworth faced a loss of about $1
billion
• This had put 7000 jobs at high risk
• Senior management took business
management strategies such as
proper pricing strategy to improve
market position of the country
• Woolsworth had poor marketing
strategy, which affected profitability

Identification of Different
Strategic Models and Theories
to Mitigate All the Issues
• The companies need to increase sales by reducing
price
• They can also reduce cost
• If production cost and demand is high, prices will
increase
• Acceptable pricing needs to adopted to tackle with
high competition

Five Generic Strategies of
Australian Supermarket
• Porter’s five generic models helps to identify the position of the
organization in the market
• Long-term business and financial profits caters to provide competitive
advantages to the company
• The model is based on: differentiation based and cost based
• Achievement of lower cost and high quality products than the market
competitors is signified by cost based model
• Differentiation based model, differences products as a unique or a
higher value to the commanding higher price rate

Cost Leadership Strategy
• Lower costs help the companies to gain more number of
customers
• High quality products at low prices
• The companies need to find out: low-cost suppliers, low-cost
raw materials and others
• Use of effective technology
• Value chain analysis helps the firms

Differentiation Strategy
• Important strategy for the business organizations
• More investments on R & D
• Different products than competitors to grab attention

Focused Strategy
• Set of actions to manufacture products to serve specific
competitive advantage
• Effective research of market
• Focus on small markets
• Creation of value

Integrated Strategy
• Combination of differentiation and low cost strategy
• Increase of product demand
• Woolsworth needs apply this strategy to improve brand
image

Formulation of Strategies
• Effective research of the market
• Identifying the issues to make use of the strategy that
matches the organizational requirements
• Proper application of the strategies