MGT302 Strategic Management: A Comprehensive Case Study of Coles

This case study provides a strategic management analysis of Coles Supermarket, encompassing a macro environmental analysis, industry analysis using Porter's Five Forces model, company analysis focusing on resources and capabilities, and a competitor analysis. The study identifies key challenges facing Coles, including theft, competition, and the threat of substitute products. It proposes strategies such as cost leadership and differentiation to achieve a competitive advantage. Recommendations include investing in human resources and focusing on high-demand goods. The analysis concludes with a prediction of Coles' potential to emerge as a leading supermarket through strategic improvements. Desklib provides access to similar case studies and solved assignments for students.

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Executive Summary
Strategic management plan for the Coles supermarket comprises of the analysis of a
number of aspects such as the macro environmental analysis, the industry analysis where a
number of things have been looked at such as a description of the product lifecycle of the
industry and the porters 5 forces model, the company analysis where the resources and
capabilities of the company have been looked at. There is also the competitor analysis and
strategy analysis. Finally, the write up has some recommendations that have been made from the
position if Coles Company that has been established by the analysis of the above-mentioned
aspects. A prediction for the future of the company has also been included in the write-up.
Table of Contents
Introduction………….……………………………………………………………………………1
Macro environment analysis………………………………………………………………………2
Industry analysis ………………………………………………………………………………….3
Company analysis: Resources and Capabilities…………………..………………………………4
Competitor analysis……………….………………………………………………………………5
Strategy analysis…………………………………………………………………………………..6

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1. Introduction
There are various supermarkets in Australia that sell goods to the public. They do sell
various types of goods ranging from consumables to non-consumable goods. Some of the
supermarkets found in Australia are; The Woolworths, Coles supermarket, the IGA supermarket,
Star Mart supermarket, Shop-Rite supermarket, Friendly Grocer among others.
For our case, we are going to look at the Coles supermarket.
There are a number of challenges that are facing not only the Coles but also almost all
supermarkets in Australia, some of these problems are, theft and shoplifting by some of the
customers, competition from the continually growing retail ventures among others. There is,
therefore, need to carry out an analysis on various sections so as to determine the appropriate
way to deal with these challenges (Hill, 2017 p.67)
2. Macro environment analysis
The macro environment refers to all the factors without an organization that affects its
general operations and well-being. Some of these factors are; the demographic factors, economic
factors, political/legal\A factors, technological factors and social-cultural factors. The macro
environmental analysis provides a means of understanding each of these factors and identifying

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the existing trend in each of them. It is by identification of the trends that exist that actually
provides opportunities for the company (Hill, 2017 p.197)
For our case, for instance, we are going to look at these factors and identify the changes
taking place in each of them so as to notice the current trend. With the establishment of the
trends, then this would put the Coles supermarket in a better position of fully utilizing the
available opportunities (Robson, 2015 p.89).
Demographic changes -Some of the changes are; changes in rural-urban migration, changes in
the general ethnic composition of the population, changes in birth and death rates, changes in the
life expectancy etc. Economic Changes-Changes in interest rates offered by banks and other
financial institutions, changes in inflation rates, changes in the exchange rates etc.
Political/Legal Changes-Changes in the taxation policy of the country, changes in the
environmental protection laws, changes in laws regarding amalgamation and merging etc.
Technological changes-changes and increase in data distribution means and methods by means
of various communication systems (Freeman, 2010 p.45).
Social-cultural changes-Changes in gender and their involvement in the task force,
changes in concern for customers, changes in concern for the environment etc. The above factors
and each of the changes taking place in them have a great implication on the Coles supermarket.
The changes in the taxation policy for instance under the political/legal factors put the Coles
supermarket in a very uncertain position. When the taxes are increased this means that they
would be making much fewer profits than they already are. This will make them increase their
prices to cater for the extra fees. Increasing their prices, on the other hand, will tend to affect
their relationship with their customers (Moutinho & Vargas, 2018 p.212).

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Changes in the rural-urban migration will also have an implication on Coles supermarket,
an increase in rural-urban migration will mean that a lot of people will be shifting to the urban
centers and since Coles supermarket is located in the urban areas this will mean an increase in
the number of customers. From all the above factors, it is important that Coles supermarket looks
at each of the changes and trends taking place in them so that they can take advantage and utilize
the available opportunity maximum by adjusting and changing some of their priorities so suit and
fit into the identified trends.
3. Industry analysis
The life cycle stage of the industry
When the performance of a product is plotted against time, it assumes various stages of
development that tend to change when the product is first introduced to the market to the time it
is withdrawn (Freeman, 2010 p.61).
Introduction stage -This is when the product is first introduced to the market, the customer has
no knowledge of the product and during this stage, the company makes no profit at all or they
may even make negative profits since the product is not purchase.
Growth stage-At this stage, the customers start to become aware of the product. Knowledge
about the existence of the product spreads and this increases its sales. The competition also
becomes aware of the existence of the product and start coming up with ways of countering the
product.
Maturity stage-At this stage, the customers become fully aware of the product in the market and
the sales of the product reach its peak. Performance curve of the product is usually at its peak

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during this stage the competition, however, considers your product as a threat and the come up
with ways of countering it (Eden & Ackermann, 2013 p.122).
Decline stage-The performance of the product starts to decline. There are no new customers
purchasing the product apart those from the category of laggards.
Porter’s 5 forces analysis
There 5 factors that were proposed that helps in this, they were referred to as porters 5
forces model. They are clearly explained below;
The threat of segment rivalry- This refers to a situation where each of the available
company tends to want to be known as the best producer of goods and services. They, therefore,
tend to increase their costs of operation. Increased segment rivalry has an effect of making the
cost of operation in a certain industry so high (Cohen &Roussel, 2013 p.301).
The threat of new entrants into the Industry-This refers to the entrance of totally new
members in the market. Well, new members tend to bring new products that are even much
developed and at a much cheaper price but still targeting the same market. This increases
competition and makes a certain industry undesirable (Hill, 2017 p.307)
The threat of customers increasing their bargaining power- This refers to a customer or a
group of customers acting individually or even collectively to advocate for changes in aspects
about the products being offered, some of these aspects are; the price of the product, the
packaging etc.
The threat of suppliers increasing their bargaining power- This refers to the suppliers of goods
avoiding and resisting to supply goods so as to demand things like contracts etc.

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The threat of substitute product-A substitute product in a product that serves the same
purpose as the product that exists in the market.
It is important to note that these were proposed by Michael Porter. They are used to
determine the attractiveness of a market of a particular market segment (Eden & Ackermann,
2013 p.102).
4. Company analysis: Resources and Capabilities
Cole’s supermarket has the available resources and the appropriate capabilities to aid in
achieving its goals and objectives of profit maximization. Cole supermarket does not only sell
food, it also sales home supplies and stationary which is a great advantage to them. Their prices
are not so high which attracts so many customers. Their stores are well organized and neatly
arranged (Freeman, 2010 p.108). It is also strategically located which is among one of its major
advantages. Its location plays a very crucial role in making Coles supermarket achieve its
strategies and objectives.
As far as environmental factors are concerned, it was noted that demographic factors such
as changes in rural-urban migration are likely to have a great impact of assisting Cole
supermarket to achieve its goals since a lot of people will be traveling to the urban areas thus the
company is likely to have so many customers.
5. Competitor analysis
There are some competitive threats that Coles supermarket needs to address. From the
Porters five forces model, it was noted that there are some threats that when not well handled
then they are likely to cause some serious problems (David, 2011 p.79). The issue of the threat of
substitute products, it was noted that a lot of substitute products are being introduced in the

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market and these newly introduced products are being sold at a considerably cheap price by the
competitors (Wheelen & Hunger, 2011 p.67). This brings about competition since almost all
customers are going for the new product which is way much cheaper.
6. Strategy analysis
There are a number of strategies that can be proposed for Coles Supermarket. Strategy
formulation is always conducted at the corporate level which consists of the top management
such as CEOs and other top managers. They are usually tasked with the formulation of a
company’s mission and therefore formulate the strategies that are to be implemented at the
business level (David, 2011 p.109).
The proposed strategy for Cole’s supermarket is the generic/porter generic strategies.
They are strategies that aim to achieve a competitive advantage against all the other
supermarkets in the industry. These strategies are; the cost leadership and differential strategy.
Analysis if it is working out or note
The above-mentioned strategies are working out for Coles supermarket, as we know the
cost leadership is a strategy aims at seeing the supermarket is considered as a cheap pest of
goods and services, by producing goods at a very low price. This is so since Coles supermarket
sales goods at a considerably low price and still manages to make a considerable amount of
profit.
Suggestions for improving current strategies
It can be suggested that Cole’s supermarket also incorporates the differential strategy in
its system; this will tend to make its products much more preferred over the other competitors in

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the industry since they would be unique and so different. This is likely to make Coles
supermarket among the leading supermarkets in Australia.
Conclusion
From the above-mentioned facts, it is clear that Coles supermarket is not a bad position. Its
situation is well identified and there are great chances of improvement. There are different
general stores in Australia that pitch products to people in general. They do offer different sorts
of products running from consumables to non-consumable merchandise. A portion of the
general stores found in Australia are; The Woolworths, Coles market, the IGA grocery store, Star
Mart general store, Shop-Rite market, Friendly Grocer among others. There are various
difficulties that are confronting the Coles as well as all general stores in Australia, a portion of
these issues are, burglary and shoplifting by a portion of the clients, rivalry from the ceaselessly
developing retail wanders among others. There is hence need to complete an investigation into
different segments in order to decide the proper method to manage these difficulties. The full-
scale condition alludes to
Recommendations
As in the current position of the Coles supermarket, there are a number of
recommendations that can be made;
I. The supermarket should invest in their human resources so as to make them much more
productive
II. The supermarket should start to deal with the first moving goods and greengrocery.
III. Cole’s supermarkets future is not well defined but from their current situation, there is no
any doubt that they are definitely going to emerge the top supermarket in the nearby

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future if they fully implement the proposed strategies and the above-mentioned
recommendations.
IV. every one of the elements without an association that influences its general tasks and
prosperity.
V. A portion of these components is; the statistic factors, monetary variables, political
factors, innovative elements and social elements. Large-scale natural investigation gives a
method for seeing every one of these elements and distinguishing the current pattern in
every one of them.
VI. It is by recognizable proof of the patterns that exist that really gives chances to the
organization. In our case, for example, we will take a gander at these components and
distinguish the progressions occurring in every one of them in order to see the present
pattern. With the foundation of the patterns, at that point, this would put Cole’s market at
a superior position of completely using the access openings.

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References
Cohen, S. and Roussel, J., 2013. Strategic Supply Chain Management: The Five Core
Disciplines for Top Performance, Second Editon. McGraw-Hill.
David, F.R., 2011. Strategic management: Concepts and cases. Peaeson/Prentice Hall.
Eden, C. and Ackermann, F., 2013. Making strategy: The journey of strategic management.
Sage.
Freeman, R.E., 2010. Strategic management: A stakeholder approach. Cambridge university
press.
Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function.
Macmillan International Higher Education.
Moutinho, L. and Vargas-Sánchez, A., 2018. New performance measurements. Strategic
Management in Tourism, CABI Tourism Texts, p.212.
Robson, W., 2015. Strategic management and information systems. Pearson Higher Ed.
Wheelen, T.L. and Hunger, J.D., 2011. Concepts in strategic management and business policy.
Pearson Education India.