Analysis of Countdown's Business and Corporate Level Strategies

This report analyzes the business and corporate strategies of Countdown, a leading supermarket chain in New Zealand, formerly known as Woolworths New Zealand. It begins with an executive summary outlining key aspects of the analysis, including the application of Porter's Five Forces to assess the competitive environment. The report delves into Countdown's business-level strategy, focusing on customer service, automated systems, and the challenges of e-commerce in the retail sector. It applies Porter's Five Forces to evaluate rivalry, supplier power, buyer power, threats of new entrants, and the threat of substitutes. The report then examines Countdown's corporate-level strategies, including sustainability initiatives, CSR efforts, diversity and inclusion programs, and team management practices. Furthermore, the analysis extends to competitive dynamics, merger and acquisition considerations, and international strategy, with a focus on how Countdown uses its core competencies to implement its strategies. The report concludes with recommendations for Countdown's future strategic development, emphasizing the need to adapt to changing customer demands and maintain a competitive edge in the dynamic NZ retail market.

Running head: MANAGEMENT
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Name of the Student: GAURAV SHARMA
STUDENT ID: 20181261
SUBMITTED TO SAIDA
Author note:

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Executive Summary
Client service expectations are in elevation when retailers offer self-service in addition to
automated systems. At the same time as, numerous retailers continue to be indeterminate
regarding e-commerce services which have steered them to focus on brand development, client
information accompanied by feedback as well as sales transactions. Retailing involves the
business activities engaged in selling goods and services to customers in support of their
personal, family or household use. Idea of retailing in current times is placed at a thought-
provoking junction. Porter’s Five Forces analysis aids organization in shaping the structure of
respective industry. With the implementation of this framework, Countdown, one of the leading
organizations in New Zealand, formerly known as Woolworths New Zealand, has been able to
mark out a position which not only displays augmented level of profitability but also shows
certain degree of susceptibility towards threats. The report has offered comprehensive insights as
to the way theoretical knowledge will be applied in developing strategies for Countdown.
Additionally, the paper analysed Countdown’s business-level, corporate-level, competitive
dynamics, merger-acquisitions and global strategy and the way core competencies are used to
implement the strategy. Implementation of alternative resources can be taken into account as the
concrete appreciation as well as reassurance of the respective retail unit. In addition to
supplementing in the interesting image of the respective retail unit, the proficiencies have
seemed to be extensively reliant on the resources. Moreover, it has been concluded that the NZ
retail domain is at a fluctuation and customer demands have been consequently changing every
moment.

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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................4
Business-Level Strategy applied by Countdown.........................................................................4
Porter’s Five Forces.....................................................................................................................4
Corporate Level Strategy applied by Countdown NZ.................................................................8
Analysis of Competitive Dynamics.............................................................................................9
Analysis of Merger and Acquisition of Countdown..................................................................10
Analysis of International Strategy.............................................................................................11
Conclusion and Recommendation.................................................................................................13
References......................................................................................................................................15

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Introduction
Retailing involves the business activities engaged in selling goods and services to
customers in support of their personal, family or household use. Concept of retailing in recent
times is positioning at an interesting crossroads. On one hand, retail sales are at their most
elevated position in history. Wal-Mart is now known as the leading company in the world in
relation to sales ahead of Target, Amazon, Kmart and Giant Eagle (Varley, 2014). However, on
the other hand, retailers encounter several challenges as number of consumers tends to shift their
purchase decisions with increasing rate of options available to them. Similarly, Countdown is the
one of the leading retailers in New Zealand formerly known as Woolworths New Zealand which
to thrive in the long term has been requiring a strategic plan and a preparedness to adapt new
strategic concepts for future strategic formulation. As per the official website of Countdown, the
company in June 2018, Progressive Enterprises Limited changed its name to Woolworths New
Zealand. Countdown is known as a New Zealand full-service supermarket chain as well as
subsidiary of Woolworths NZ that is also a subsidiary of Australia’s Woolworths Limited
(Countdown.Co.NZ, 2019). Reports of Fernie and Sparks (2018) have mentioned that
Countdown stores operating in NZ retail sector with an employee base of over 18,000 are larger
in comparison to average New Zealand supermarket. The first Countdown store opened in the
year 1981 and currently the retail chain has expanded to around 180 stores till 2018. It is
renowned as the largest single supermarket chain in New Zealand in relation to number of retail
stores, while its major competitor Four Square chain comprises of a significant number of
premise that entails smaller retail stores in rural regions. As per the opinion of Ayers and
Odegaard (2017), Countdown has been known as the first supermarket in New Zealand
to publicize all stores nationally will phase out single-use plastic carrier bags at counters and

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online shopping by the end of 2018. The aim of the report is to apply theoretical knowledge in
developing strategies for Countdown. Additionally, analyse Countdown’s business-level,
corporate-level, competitive dynamics, merger-acquisitions and global strategy and the way core
competencies are used to implement the strategy.
Discussion
Business-Level Strategy applied by Countdown
Customer service expectations are high when retailers offer self-service as well as
automated systems. Concurrently, many retailers remain uncertain regarding e-commerce
services which have led them to shed light on brand improvement, customer information along
with feedback and sales transactions. There can be found issues which retailers must resolve
such as “How can retailers serve best to their customers while earning reasonable revenue?”
“How can retailers gather greatest attention in highly competitive environment where consumers
have number of alternatives?” However, retail decision makers can most effectively address
these questions by efficiently comprehending and relating the fundamental principles of retailing
in a well-structured, methodical and focused retail strategy (Ayers & Odegaard, 2017).
The Business-Level strategy is applied by Count Down to establish competitive
advantages over its industry competitors. Framework models of strategic management are
applied to make critical analysis of the environment in which Countdown is operating along with
its respective mission goals as well as strategic choices.
Porter’s Five Forces
Porter’s Five Forces analysis helps organization in determining the structure of respective
industry. By applying this model Countdown has been able to stake out a position which not only

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shows increased level of profitability but also shows certain degree of susceptibility towards
threats.
Rivalry among existing competitor- There has been witnessed substantial increase in the
number of businesses operating in the NZ retail industry where price conflicts amongst major
grocery stores keep elevating. These price conflicts with fluctuating revenue rates among
Countdown and its rivals Four Square chain and lower-cost 'food warehouse' PAK'nSAVE, have
led the company to face extensive degree of rivalry within this sector (Bailey et al., 2015).
Consequently, these are creating limits to its market share and forcing Countdown to
continuously form competitive and effective strategies to distinguish them from its rivals.
Bargaining power of suppliers- The greater suppliers are, the more extensive their power are.
With Countdown and Four Chain comprises of a significant number of almost 70% of the
market, number of domestic New Zealand retail producers are encountering a significantly
restricted choice of intermediaries. Nevertheless with large number of suppliers with the
emergence of local and overseas, bargaining power of suppliers will moderate (McLean &
Hoek, 2014).
Bargaining power of buyers- With increasing number of rivals in the sector, higher quality and
efficient products, more innovation and additional preferences are being offered to purchasers.
There can be witnessed a robust bargaining power since Countdown’s consumers are majorly
individual purchasers, thus these established buyers tend to compel businesses to lessen their
price and also create price conflicts among Countdown and Foodstuffs Limited (Shehu &
Mahmood, 2014). However, with number of grocery stores and food lines sectors industry
accessible in NZ retail sector, this has elevated rate of consumer preferences where they can

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evaluate prices of products both online and offline and introduce best alternatives for its target
base.
Threats of new entrants- Both groceries and food lines industry in New Zealand is a well-
established one. Drawing this factor into consideration, the threat of new entrants is quite
considerable for Countdown owing to number of factors. Moreover, with potential current and
dominant players in the New Zealand supermarket industry such as Countdown formerly known
as Woolworths NZ and Foodstuffs Limited, new entrants have the propensity to encounter risks
of losing their investment (Ayers & Odegaard, 2017). Consequently, it becomes challenging for
them to establish new businesses and gather excellence due to the need of substantial capital for
operation and capacity to compete among current competitors which possess incredible brand
image.
Threat of substitutes’ products and services- The threat of substitutes is of extensive intensity
in this sector and maintains growing at a rapid pace. Countdown is encountered with extensive
competition due to direct and indirect rivals. There can be found number of products being
offered through convenience stores such as Food Stuff and Pak’n’Save, its major competitors
offering more or less similar strategy and same primary products (Teller et al., 2016). Moreover,
Countdown is encountering the Farmers’ markets which are providing organic products owing to
the growing inclination towards healthy living.

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Porter’s Five Force framework
Source: (Dobbs, 2014)
Differentiation Strategy- Countdown has managed to vertically incorporate few of its supplies
by producing own inputs to elevate its respective operating market power and also act responsive
towards private level trend. Studies have revealed that cost leadership culture is highly prevalent
in Countdown as the organization shows utmost commitment in offering the consumers with
supreme quality at economical prices. Thus, Countdown must take into consider the cost-
leadership schemes in order to proceed in the thriving competitive market. The company has
been growing at rapid pace in comparison to Food Stuff (Dawes & Nenycz-Thiel, 2014). It is a
major indicator of acquiring greater customer base after pouring over $1 billion into declining
prices and upsurging customer services. Meanwhile, Countdown's newest stores are another
indication of the grocery group's plan in order to create supermarkets tailored for specific
markets. Reports of Hamzah, Alwi and Othman (2014) have mentioned that shelves are stocked
in a different way from stores in richer outskirts or rural communities as major part of

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Countdown's strategy in order to use data to tailor-make stores which diligently follow local
requirements.
Corporate Level Strategy applied by Countdown NZ
Countdown’s Sustainability and CSR Strategies- Countdown sustainability strategy mainly
focused on the reduction of its gender wage gap to around 1.11% and the decrease of its carbon
emissions by almost 8.8%. The company’s CSR report openly sheds light on business continual
commitment to its team which are to focus on sustainability and enhancing lives of Kiwis. The
organization’s 2020 goals have facilitated the company to focus their attention most efficiently
on the areas where Countdown can create a tangible difference for New Zealand as well as New
Zealanders. Reports of Klettner, Clarke and Boersma (2014) have mentioned that number of
grocery stores in New Zealand are reducing use of plastic bags and increased number of shelves
along with usage of caged eggs and raise voice against "period poverty" by providing discounted
women's sanitary products. In addition to this, Countdown has raised around $1.26 million for
children’s hospitals through the Countdown Kids Hospital Appeal and further increased number
of own-brand products with Health Star Rating to almost 82%. Meanwhile, as per the opinion of
authors, the company has been supporting the local economy by sourcing 100% of fresh chicken,
lamb and pork in addition to around 97% of fresh beef from New Zealand farmers.
Countdown’s Focus on Encouraging Diversity- Increasing female representation across
Countdown’s team offers profound role models thus attracting exceptional talents and
contributes to the ability to retain high-performing women. At present around 35% of employees
from manager, senior management and executive level roles at Countdown are occupied by
women. The company has been committed in building a culture which stimulates more women
to be represented in senior positions across the business. Furthermore, in 2016 and 2017,

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Countdown has completed a comprehensive gender pay equity assessment and evaluation for
equal opportunities of the waged team members in order to recognize any pay inequality between
men as well as women in ‘like-for-like’ or equitable roles (Countdown.Co.NZ, 2017). Wages for
over 700 people have been evaluated and where gender-based pay gaps have been reviewed
where salary increases have been provided. Studies have noted that Countdown has further
progressed into a further phase of company’s review, where the organization perceives at
additional number of senior positions and roles in which there have fewer people to compare.
Countdown has been continuing to assess employee strategies and commitments in order to
guarantee employee base enjoys the equivalent rewards and opportunities irrespective of gender.
Team Management- Meanwhile, Countdown has been investing in the tools which are required
by their staffs to execute their roles. Studies have revealed that one area where Countdown has
been responsive regarding the need for enriched communication across the business while
engaging as well as efficiently informing its team. Furthermore, as per the view of authors, in
2017, the company’s Internal Communications team achieved a Public Relations Institute of
New Zealand award for announcing a world first new communications platform known as
Workplace by Facebook (Luiten et al., 2016). However, recently Countdown has continued the
development of company’s sustainable engagement score rising year-on-year. Also, Countdown
showed an assignation score of around 84% in comparison to the international retail average of
almost 82%.
Analysis of Competitive Dynamics
Competitive rivalry is considerable in the NZ retail industry leading Countdown to face
intense level of competition from current and new entrants. Presence of robust competition
coming from Foodstuff Limited in the NZ retail sector is considered to be limiting the market

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share of Countdown also by contributing increased level of concentration. Reports of Dawes and
Nenycz-Thiel (2014) have mentioned that Foodstuffs which owns the Pak 'n Save as well as New
World brands is in reality a assemblage of three regional companies mainly regulated by local
owner-operators. On the contrary, Progressive Enterprises which operates the Countdown and
Food town supermarkets has extensively more centralised operation primarily owned by listed
Aussie retailing giant Countdown. Even though Countdown has assured to offer products at
economical prices meant for its New Zealand consumers and driving extensive bargain for
improved terms from its suppliers. Meanwhile, after being exceeded by Countdown with a
decline of 15% on their product sales prices, majority of suppliers have offered the same deals to
Foodstuffs (Hamzah, Alwi & Othman, 2014). On the other hand, Progressive has expanded
through numerous mergers and acquisitions since last few years and with support of its
predecessor companies has comprised of a number of owners, which involved companies like
Hong Kong's Dairy Farm Group as well as Australia's Coles Myer and Foodland Associates.
Analysis of Merger and Acquisition of Countdown
The continuing challenges in the NZ retail sector have compelled some retailers to go out
of business. Majority of the challenges which retail organizations have been presently
encountering are owing to significant lack of innovation as well as investment in technology.
The very merger of Woolworths owned supermarket Progressive Enterprise with three of its
supermarket brands into Countdown has been highly effective and profitable for the NZ retail
industry. While, such a merger in the year 2009 has marked at a conclusion to the Food town and
Woolworths brands in New Zealand, best store idea in New Zealand has been competing with
major competitor, Foodstuffs, specifically in its Pak'n’Save stores (Klettner, Clarke & Boersma,
2014). On the other hand, to the end Progressive has been rolling out an enhanced consumer-

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friendly Australian store format in its New Zealand supermarkets. This has led New Zealand
supermarket show an elevated around 198% of revenue growth in comparison to its former
corresponding period.
Analysis of International Strategy
Implementation of international retail strategy aids Countdown New Zealand to evaluate
the international opportunity and re-evaluate target nations through extensive analysis. Drawing
relevance to an evaluation of target market is related to the consideration of market entry mode.
Considering global strategy of Countdown, this decision has been profoundly based on specific
motives, its internationalization aims and the profitability of the market where the company
wants to penetrate (Ishii & Xuan, 2014). Taking into account the Singaporean market,
Countdown opts for a number of ways by which to penetrate the market. Each mode of entry
comprises its exceptional set of challenges and risks for Countdown thus determining the
accomplishment or failure its operations in the new market. However, with the aim of
Woolworth’s internationalization strategy into the Singaporean market, three modes of foreign
market entry must be analysed as the most suitable for Countdown such as export entry mode,
joint venture, and franchising as well as foreign direct investment entry mode.
Export Entry Mode
Exporting is the least risky mode a company can choose when planning to penetrate a
foreign market. It is often the first consideration most companies choose when planning to do
business internationally. For the case of Woolworth, exporting to the Portugal market means that
it will generate its own products and enable the exporting of the product to the new market
directly or indirectly (Chatterjee & Brueller, 2015).
Indirect Exporting

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In such a mode, Countdown does not regulate the process of exporting, documentations
in addition to other related logistics. Rather it employs a third party in order to handle the
logistics as well as deliver their products to the market into the foreign company. As per the view
of Hosken et al. (2018), indirect exporting show great profitability for its low level of political
and marketing risk. There can also be witnessed the benefit of being competent in order to opt
for a reputable and experienced exporter. However, indirect exporting implies to the fact that the
organization capitulates its control of place, time and the process through which their products
will be delivered in the foreign market.
Joint Venture
For Countdown entering into the Singaporean market, joint venture primarily implies that
the company penetrates into a contract for enduring or short term development or investment on
behalf of the mutual accomplishment of the party’s goals. This strategy further implies that
Countdown will share both risk and capital in the development of the venture. The benefits of
this specific mode of entry that it is less risky and highly productive as both parties target into the
others exceptional strengths while moderating areas of weaknesses of each other.
Foreign Direct Investment entry mode
Investment as a vital entry mode has been considered as appropriate international strategy
for market expansion. For Countdown, penetrating into Singaporean retail market, this mode will
enable the organization to assume regulation over the mode of entry. Also in the case of
Countdown’s global strategy, the company will assume ownership of the subsidiary in the
foreign nation and develop novel business model which suits the new market on the basis of its
exceptional developmental goals, skills and abilities (Koenig et al., 2014).

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Conclusion and Recommendation
Therefore, from the above discussions it can be conclude that the implementation of
alternative resources can be taken into account as the concrete appreciation as well as
reassurance of the respective retail unit. In addition to supplementing in the appealing image of
the respective retail unit, the proficiencies have seemed to be extensively reliant on the resources.
Moreover, it can be concluded that the NZ retail domain is at a fluctuation and customer
demands have been consequently changing every moment. As a result, Countdown must show
utmost willingness in order to serve the clienteles at particular time and by offering novel as well
as innovative approaches. Moreover, as customer social trends along with preferences show a
tendency to exhibit dynamism, the retail organization can cater to the requirements on account of
making an allowance for the higher growth level strategies.
Furthermore, it can be noted that Countdown can be reinvigorated in order to focus on
their areas of disadvantages and downsides with equivalent sincerity and passion, as they have
shown a propensity of inclining towards their achievement or success in order to recognize their
own capabilities that might gratify the reason of comparative competitive advantage.
On the other hand, Countdown will require modifying its reduced pricing policy in order
to shown adequate decisiveness in the extremely competitive domain of New Zealand retail
sector. Moreover, as customers in recent times show willingness to pay higher price for supreme
quality products, Countdown can elevate its price range. Such a strategy tends to show certain
level of effectiveness in the accomplishment of its objective involving being deliberated as first
precedence for the clienteles. In addition to this, Countdown formerly known as Woolworths
must shed light on the adaptation of reasonable price policy as this strategy can facilitate the
business to successfully obtain effective cost-leadership approach as well as control of pleasing

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the purchasers’ demand of lesser pricing. The various mode of entry obtainable tend to present
an exclusive choice that Countdown has to make prior to the implementation of its global
strategy for entering into the Singaporean market. Moreover, risks and assurance of resources are
undoubtedly considered as higher than in other modes of entry. However, these tend to get
alleviated by the business’s widespread resource base in addition to its valuation of the new
market to update strategic entry.

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