Report on Business Decision Making: Lidl's New Store Launch Strategy

This report delves into the business decision-making process surrounding Lidl's plan to launch a new discount supermarket chain, considering the competitive landscape in the UK. It presents primary data gathered through a customer survey to assess preferences regarding price, location, and convenience, alongside secondary data analyzing Lidl's financial performance relative to competitors like Tesco, Sainsbury's, and Morrison's. The analysis encompasses sales revenue, gross profit margin, operating profit margin, net profit ratio, and market share to determine Lidl's competitive positioning. Key findings from the primary research indicate that customers prioritize both price and quality, and prefer both physical and online shopping options. The secondary data reveals Tesco as a market leader in terms of revenue and profitability, posing a significant competitive challenge for Lidl. The report concludes with recommendations for Lidl to focus on price and quality, integrate both physical and online channels, and develop strategies to enhance its financial performance and market share in the competitive UK retail market. Desklib provides access to this and similar solved assignments for students.

Business Decision Making

EXECUTIVE SUMMARY
Business decision making refers to the selection of suitable option out of several
alternatives available. For this project, Lidl has been selected which offers retail products or
services to the customers at discounted price. In this, for assessing customer’s preferences and
attitude towards new store survey has been conducted. In addition to this, secondary sources
have also been evaluated for getting suitable information. It can be summarized from the
evaluation that customer’s give more priority to both price and quality of products. Thus, by
making focusing focus on such aspects Lidl can get desired level of outcome or success. In
addition to this, it has assessed that customers prefer to purchase products from both physical and
online store. Thus, at the time of developing competent strategic and policy framework regarding
new store launching business unit should keep in mind such aspects.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Primary data collection................................................................................................................3
Analysis of primary data set........................................................................................................6
Collection of secondary data.....................................................................................................16
Analysis of secondary data........................................................................................................18
Key findings...............................................................................................................................20
Conclusion and recommendations.............................................................................................21
REFERENCES..............................................................................................................................23

INTRODUCTION
In the current times, business units are required to take significant decisions about
operations by evaluating market growth opportunities and competitor’s activities. Manager is
assigned with accountability to make optimum utilization of funds by doing assessment of
investment opportunities. The present report is based on the case scenario of Lidl which is
planning to launch discount supermarket chain. However, in this regard, high level of
competition takes place in UK as there are several retailers namely Sainsbury, Morrison’s Tesco,
ASDA etc are offering products or services at discounted prices. In this, report will shed light on
the customer’s preferences with regards to the supermarket chain in terms of price, location,
convenience etc. Further, report will also highlight the extent to which financial performance and
position of Lidl good in comparison to the competitors. By this, firm would become able to take
significant measures for performance improvement and maximization of profitability.
MAIN BODY
Primary data collection
In order to assess customer’s needs, wants and preferences with regards to discounted
supermarket chain primary data will be gathered by Lidl through the means of survey via
questionnaire. Hence, survey will be conducted on 50 customers of Lidl to identify their
preferences pertaining to product, price, place and promotion. Through this, Lidl can set
appropriate marketing mix and thereby would become able to gain competitive edge over rivals.
Questionnaire is included in appendix
Analysis of primary data set
Theme 2:
Particulars Responses % of responses
25-35 years 10 20%

26-45 years 15 30%
45-55 years 15 30%
56 years and above 10 20%
Total 50 100%
Theme 3: Gender
Particulars Responses % of responses
Male 20 40%
Female 30 60%
Total 50 100%

Theme 4: Education
Particulars Responses % of responses
Diploma 5 10%
Graduation 10 20%
Post-graduation and diploma 25 50%
No higher studies 5 10%
Total 50 100%

Theme 5:
Particulars Responses % of responses
£3000-5000 7 14%
£5000-7000 12 24%
£7000-9000 18 36%
£9000 and above 13 26%
Total 50 100%
Theme 6:
Particulars Responses % of responses
Part time 15 30%
Full time 25 50%
Student 10 20%

Total 50 100%
Theme 7:
Particulars Responses % of responses
£300-500 5 10%
£500-700 12 24%
£700-900 15 30%
£900 and above 18 36%
Total 50 100%

Theme 8: Customers do shopping from Lidl’s store more frequently
Particulars Responses % of responses
Often 10 20%
Weekly 12 24%
Twice in a week 15 30%
Monthly 13 26%
Total 50 100%

By doing primary research, it can be said that the 30% of the respondents prefer doing
shopping twice a week with Lidl and 20% of the respondents prefers doing shopping more often.
Theme 9: Both the modes are preferred by the customers for shopping purpose
Particulars Responses % of responses
Visiting of physical store 25 50%
Online mode 25 50%
Total 50 100%

As stated by the above graph, the cusomers are preferring both the modes of shopping
equally (50%), that is, physical store shopping and online mode of shopping.
Theme 10: Price and quality factor comes under priority when customers do shopping
Particulars Responses % of responses
Price 25 50%
Quality of products 15 30%
Availability of brand or
varieties
10 20%
Total 50 100%

Based on the above outcome, the 50% of the customers gives priority to the price of the
product, followed by 30% preferring qualityand the remaining 20% gives weightage to the
brands and variety of the products.
Theme 11: Customers agreed that location factor influences customer’s purchasing decision?
Particulars Responses % of responses
Agree 8 16%
Strongly agree 12 24%
Neutral 15 30%
Disagree 7 14%
Strongly disagree 8 16%
Total 50 100%