Industry Analysis of Coles' Business Strategy and Performance

This report analyzes Coles' business strategy, focusing on its strategic priorities and competitive landscape within the Australian retail market. The analysis covers the company's industry-level strategies, organizational strategies, and functional-level strategies, examining how Coles aims to enhance customer loyalty and achieve organizational development. The report highlights the rivalry between Coles and Woolworths, the impact of discounters like Aldi, and the importance of home-branded goods. Key activities, core capabilities, and competencies are identified, including pricing strategies, online operations, and supply chain management. The report also discusses the challenges posed by online retailers like Kogan and Amazon, and how Coles is adapting its approach to maintain its market position. Furthermore, the analysis includes Coles' strategic objectives, such as providing premium goods at lower rates and expanding its retail network. The report concludes with a strategic analysis of Coles' strengths, weaknesses, opportunities, and threats, offering insights into its future prospects in the evolving retail environment.

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Introduction
The following article outlines the controversy on Coles 'marketing policy. The
company's key strategic priorities are defined, and the different strategy stages of the Coles
supermarket, such as strategies at the industry level, organizational strategies and functional
level strategies, will also be described. The corporation has accomplished these approaches to
improve consumer loyalty and organizational development. The accompanying article further
addresses the strategic strategy that the corporation is pursuing in an appropriate and
productive way in order to meet corporate goals and priorities (Tarzian, & Force, 2013).
The business's success in the sector relies on how the organization has progressed
with the unpredictable and unexpected potential effects. In order to develop effective
management plans, management plays a key role in typically scanning the environment. This
article utilizes the case study to analyse actors in Australia's retail sector in the light of
systematic strategic management. Australia has many agricultural companies. Woolworths
and Coles are the leading brands in Australia in the retail store business. Both groups account
for almost 60% of alcohol sales, 50% of petroleum sales and 80% of supermarket sales.
Woolworth and Coles fought for a long time. With the entry of new entrants into the
business, however, rivalry between the two major supermarkets has increased. The two firms
used their retail operations to gain a strategic advantage on their rivals and cope with the
question of completion (Granstrand, Patel, & Pavitt, 2017).
Business background
In 1914, Coles Group was founded. The business has also seen immense success and
is known as one of Australia's biggest retail chain. It serves as warehouse and convenience

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outlets that sell a wide selection of items to Australians, from books, home-decoration, food
and financial services. This hires nearly 107,000 staff leaders who work with diversified
industries from supermarkets who internet sales executives. Workers was consistently
equipped to boost the company's profitability (coles.com.au, 2018). In 2017, the business
produced revenue of approximately $970 million (Cappelli, & Crocker-Hefter, 2016).
Business industry
In the Australian shopping industry, Coles store trades. The grocery and retail
markets are perceived to be one of Australia's most successful sectors. The increasing growth
of discounters like Aldi has had a huge influence on the country's supermarket sector. Aldi
also gained the interest of the majority of customers despite intensified pressure from the
industry because of strong prices for private branded items. Considered giants, such as Coles
and Woolworths, were eventually persuaded to reduce costs and extend their branded private
goods. The high profit margins of the sector fell at a rapid pace as companies cut income and
welcomed smaller profits to keep profitable. (Nicholls and Orsmond, 2015)
The Woolworth-Coles rivalry was tight. Once Cole was bought by Wesfarmers, this
fight escalated. Woolworths was the top player in the past and Coles lagged behind because
he became underfunded. That changed later and for many years Coles was the leading player.
Reducing fuel sensations for consumers culminated in the establishment of more gas stations
for all teams. Coles and Woolworth typically fight intensely at rates so one team takes a
careful look at the other's advance in terms of demand.
Home labelled goods are another significant element in rivalry (Sohal, 2013, p.434).
Data reveals that 15-20 percent are typically home labelled with both Coles and Woolworths.
Such home branding does not render Australia appealing for advertised manufacturers,
because their goods are excluded from retail racks for domestic brands. The purchase of land

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is an uncertain field of rivalry for an ordinary user. Both players have ample land to be used
for potential production, which excludes many players from growth areas. Land ownership
ensures these players outstanding places to build in high density.
Activities
The key activity includes the selling of food and foodstuffs through their flagship
Coles grocery chain and the selling via Coles Liquor and Coles Express of liquor and
gasoline. Coles has been Australia's second biggest store after its establishment in
Collingwood, Victoria, in 1914, trailing its major competitor Woolwürds 'revenues.
Customers
With over 2,500 supermarket stores worldwide, Coles is the largest Australian
retailer. Through providing consistency, value, and convenience to the 21 million consumers
that shop with us every week, Coles makes it easy for Australians (Suter, Arndt, Arthur,
Parboosingh, Taylor and Deutschlander, 2009).
Key core capabilities evident within the organisation.
1. Coles pricing must support its Brick and Mortar presence
The Coles and Woolworths strategy is to absorb the greatest possible amount
of weekly spending. We can see this with the loses leader in milk and bread ads for
less than $1, we realize that instead consumers invest hundreds of dollars on other
items and are earning money in the "basket."
The internet team at Coles does not bill for supermarket leases, they do not
compensate the staff for shops or sales. They need a robust website and an essential

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logistics capacity to access local goods on a timely basis. There would be no surprise
about anybody that it is even cheaper than a brick and mortar company about operate
an online shop. However, as seen here and here, Coles usually charge 5 to 10% more
to buy online. This is among Cole’s online customers with 70 percent rising.
Coles has a longstanding presence in retail because, while it aims to make
internet shopping more accessible, Cole’s internet has little idea of a shopping cart
being less costly than a Cole’s store. "When internet rates are lower than in-store,
customers would avoid coming to your shops," as Kogan says it during his battle with
Harvey Norman. Harvey Norman does not work with him because it shops digitally,
and that aspect of the business is never profitable (Coombs, 2016).
2. Core Competencies are highly refined in separate areas
Such two key expertise competences are being reinforced through Wesfarmers
'(including brands such as Officeworks, Kmart, Target&Liquorland) by providing a
fully integrated supply chain and industry professionals with an view to customer
footprint. To order to maintain the product optimally safe and to remain as efficient as
feasible, Coles will deliver products from the retailer into distributor's centers, and
into stores and shelves.
The reported fall of $500 million in Woolworth's Masters, which is struggling
to compete with Wesfarmers 'own Bunnings, is an example of the Wesfarmers supply
chain in dispute. "The issue ... (leading towards a $500 m loss) is in location," says
Market Spectator, "adding sites where they are open instead of building a network
that improved the productivity of the supply chain."

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While Coles is using the systems and processes of Wesfarmers and profound
knowledge to build these core skills, Kogan has built core competencies to support an
online business model which reduces middle man and gets individual products at the
lowest possible price from the factory to the customer and masters online retail and
the requirements to get people to buy from the web (Torkkeli, & Tuominen, 2012).
Coles prices
Was it quite challenging to compete against this defined market share for
Coles because the strategic benefit that Coles offers is the big retail outlets,
strategically positioned with a wide variety of products?
Stores like IGA are more appropriate than big weekly stores for certain
residents for local conveniences, and provide them a valid substitute, as they are very
special for their sustainability. Once at Coles, a shopping trolley is open, at IGA, a
basketball is accessible (Harris, Coles, & Dickson, 2010).
Australia's third biggest retailer, the ALDI, has 361 outlets in the world which
has contributed to its popularity with innovative products which affordable pricing – a
drop in the cost of retail by 25% a week. Again, with a 25 percent cheaper argument,
Coles 'profitability on lower prices is significantly different to succeed.
The downside for Kogan is the availability of some products that are already
on line for distribution across days or weeks. The luxury of a widely accessible
commodity thus needs to be substituted with a much cheaper alternative.
Ruslan Kogan is now pledging to halve the annual grocery bill, with this leverage
being exercised by the deep discount on each brand relative to the "Australian
supermarket."

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3. Kogans play will fragment the customer
Although Coles is a tactic to catch 100% of food purchases in person and by
having the lowest price on chosen products, the Kogans approach is to compete
online. In the long run, Coles and Woolworths will adapt their approach from pricing
to the distribution of fresh food and goods that are not made accessible online, as the
marketing of pricing that plays a competitive advantage for Kogans is no benefit to
Coles (Diercks, Coles, & Kessler, 2019).
Gerry Harvey argued that all issues, from GST to Australian Dollar to
manufactured low quality is unjust, although continuing price ads – his current
strategic disadvantage. In the fight between Harvey Norman to Ruslan Kogan he said.
The outcome? Revenue migrated to Kogan organically, as his strategy was effective.
When the world evolves, the playbook that fits them so well and creates their
reputation has to be preserved and adjusted to the current setting in order to succeed.
We then could not learn from the same legacy, so consumers became divided. Users
used to buy a TV in a supermarket, some go to a shop now and some order digitally.

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Internet shopping does not fit everybody and Kogan Pantry does store up fresh food or a
significant portion of the weekly food basket some time before that. However, what it does is
draw the price conscious shoppers to buy items that fit Kogan strategically. Allow more
raspberries and soap and originally fewer cereal or soft drink. Over time the buyer would be
split up into more people that purchase cheapest goods at Kogan, going to Coles, IGA, local
markets, or even online vendors of new, local products for comprehensive ranges. The clients
are scattered and need local and individual contacts, as well as low costs (Lewis, G. M.,
Dempster, Lawn, & Robertson, 2016)..
4. Coles employees are speaking to customers less
Amazon is their biggest challenge according to Coles. Of the aforementioned
purposes, I'm even going to add in Kogan and other online retailers. The economic
benefit is also that of Coles over online supermarkets;
• a broad retail supermarket
• with comprehensive common products
• to boost customer experience
But checkouts for self-service tend to require up inventory and more consumers.
Although I am confident the return on investment in the self-service check-out will be
a matter of months, the strategic drawbacks worsen because it may be almost as angry
to contend with a robot in a store as a robot in a home setting (online purchasing).
Even the perception of the shop and its interactions with content, polite customers
can't duplicate an online retailer. This weekly routine is one of the only activities for
many people that they do to move into the modern world.

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Coles would have to confront the hard truth earlier rather than later, even as
Gerry Harvey battled against Kogan through raising rates which are now considerably
higher than Kogans. There's a huge challenge to sales, there is proof across that
markets like publishing, television that advertisement have seen the guard shift, as
politicians have been reluctant to adjust their current reputation to the modern climate
(Somerfield, Hill-Cawthorne, Lin, Zandi, McCarthy, Jones, & Hale, 2010).
Strategic analysis
Coles Strategic objectives
Coles Supermarkets have certain strategic goals to achieve the company's long-term
success and the competitive advantage over competitors from other industries including
Woolworths, Aldi and other e-shops like Amazon, eBay, etc. Many of the company's
business priorities include (Coles, Kable, Taddeo, & Strickland, 2015).
1. To provide consumers with premium goods at cheaper rates which the Business can
easily sell.
2. In order to provide the consumers with healthy and healthier food across best
shopping networks.
3. The business also plans to grow its retail stores through a network of collaborations
with other manufacturers and network owners and to establish long-term relationships
with other firms.
4. Furthermore, the Organization seeks to develop and create a strong and successful
working atmosphere and make workers believe like they contribute to the business

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and to all workers in the organization. The group strives to create an internal
operating culture that is adaptable and definitive (Coles Supermarkets, 2019).
Business Level Strategies Analysis
The Coles marketing model describes the company's expense control and
competitiveness approach. The organization utilizes the brand identity to distinguish
the goods from its rivals. The organization follows the technique of reducing the
expenses and the aid of a competitive supply chain to achieve quality control within
the organisation. Through the support of these techniques, the organization guarantees
that the consumers profit at the lowest possible expense. Such practices will help the
organization maintain the company's strategic dominance over its rivals in the long
term (Lubini, & Coles, 2012).
Corporate Level Strategies Analysis
Coles 'corporate strategy is to be the market leader in Australia's retail sector.
The company concentrates mainly on identifying and investing in services that give
customers value. The company's core approach to become a global pioneer in the
supermarket industry is to diversify its goods and services. It approach is also
beneficial in maintaining the company's competitive business place in the
supermarket field. In addition to this-this strategy is helpful for gaining more growth
opportunities for the organization.
Functional level strategy Analysis
The Coles 'practical approach is evaluated by successfully applying the company's

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new policies. Coles has an organizational engagement approach to incorporate the
organization's approaches mentioned earlier and that workers know like they are part
of the team, and so will execute the techniques efficiently throughout the business
(Coles Supermarkets, 2019).
Conclusion
In a highly competitive climate, company runs. The internal and external world is the
business rivalry. The awareness of the external world allows the organization to build
approaches to address the challenges it will face. Likewise, Australia's food business
participants are faced with the intense rivalry that the leading firms in the market are
exhibiting (Khalaf, Oakley, Coles, & Hitchcock, 2018).
It is also not possible to forecast the future of Australia's food industry. Woolworths
and Coles fight hard as they attempt to outperform each other on the market. The problem
persists that Aldi can eventually get to the fore. Aldi always responds easily and it is also
uncertain if the government will interfere in future to improve the rivalry between the clubs.

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Cappelli, P., & Crocker-Hefter, A. (2016). Distinctive human resources are firms' core
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