Business Expansion of Waitrose in a Global Context: A Report

This report provides an in-depth analysis of Waitrose's market expansion opportunities, focusing on its business environment and competitive strategies. The executive summary highlights Waitrose's internal factors influencing its supply chain, its strong consumer position, and the potential for expansion in Australian cities. The report includes a PESTEL analysis, evaluating political, economic, social, technological, environmental, and legal factors impacting Waitrose. A SWOT analysis assesses the company's strengths, weaknesses, opportunities, and threats, while Porter's Five Forces are also considered. The report examines Waitrose's business environment, including consumer demand, employee training, and the use of technology. It concludes that Waitrose has a strong foundation for growth, particularly in the Australian market, despite facing competitive pressures, especially from Coles Supermarket.

BUSINESS ORGANISATIONS AND ENVIRONMENTS IN A
GLOBAL CONTEXT
STUDENT NAME:
STUDENT ID:
UNIVERSITY:
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Executive Summary:
This report deals with the scope for market expansion of Waitrose, by analysing the
status of the organisation. Waitrose is a retail company dealing in grocery items, and its
internal factors influence the management and working of the supply chain and delivery
of products to store and place of delivery. It has been found that its functioning is
influenced by various laws, policies and reforms, along with demand from society,
environment, as well as the economic condition of the country. In addition, it has also
been observed that the company has a strong position among consumers, and has
great scope for business expansion through opportunity in various Australian cities. It
has further been found that it has a strong competitive status, and competes to a great
extent to gain a competitive edge in the market, against other companies, especially
with that of Coles Supermarket.
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Table of Contents
Introduction...................................................................................................................... 4
2. Information regarding the chosen business organisation.............................................4
3. Discussion of Business Environment:..........................................................................5
A) PESTEL Analysis of Waitrose:....................................................................................6
B) SWOT analysis............................................................................................................8
C) Porter’s Analysis of Waitrose:....................................................................................10
Conclusion:.................................................................................................................... 11
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Introduction
It is widely acknowledged that various factors are responsible due to which a business
thrives and achieves success. Apart from doing adequate market research, an
organisation also has to consider various factors like demographic factors, social factors
and so on in order to possess a stable market among other competitors. One of the
chief factors, which hint a company’s success, is its ability to expand its business to
other places and function internationally. In the present report, a broad detailed
explanation is given on how a multinational company works and what are the factors it
needs to consider while trying to expand the business and to establish branches in
other countries. An analytical study has also been made with the help of PESTLE,
SWOT analysis as well as the Five Forces of Porter. The report is made taking Waitrose
as a model multinational organisation.
2. Information regarding the chosen business organisation
Waitrose, at present, is one of the largest food retailers in Britain. Apart from working in
the British market, it also operates in Wales and Scotland and has a chain of
supermarkets equipped with its own group of working employees. It chiefly deals with
providing and supplying groceries which include milk, bakery products to health and
beauty products and much more essential items. It also provides various pet products,
kitchen products, products required for gardening as well as domestic purposes. Apart
from providing all of these, it also supplies stationery, laundry products. Providing gifts
and customised flowers are also provided by the company. Apart from the above,
feature of food delivery service and catering is also provided by Waitrose (Waitrose
Limited, 2016).
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Figure 1: Logo of the company
(Source: Waitrose Limited, 2016)
The history of Waitrose goes long way back. The company made its first appearance as
a small grocery store in 1904. Founded by Wallace W. Waite, Arthur Rose, David
Taylor, the first shop they opened was on a high street. This venture was a success.
After two years Taylor left and Waite and Rose formed the Waitrose Ltd. Their chief aim
has been to supply good quality food within a price that seems reasonable and
affordable. Later John Lewis Partnership takes over the company in 1937.
The objectives of Waitrose Company is:
● To encourage people to live well, to treat others fairly
● To develop and improve the company as much as possible
● To provide the convenience of a superstore along with the feature of a top level
food shop is the chief aim Waitrose.
At present, Waitrose is one of the largest retail organisations, which operates all over
the UK as well as Scotland and Wales. Apart from providing groceries and other daily
essentials, it has expanded its business and also provides other home delivery. Known
for its quality products, from good fresh vegetables to fruits, the company is earning
more name as a reputed and genuine brand which believes in giving the best to its
customers. There are two factors which are responsible for making Waitrose unique
from its other competitors. The first factor is that Waitrose is the only retail company
which has acquired the Royal Warrant from the Queen herself. The second reason is,
the company is co-owned by 39,000 ‘Partners' or employers. At present, with the
assistance of SAS, the company is now striving to be the best service provider among
all its other retail competitors (Stanley and Stanley, 2014, p.97)
3. Discussion of Business Environment:
The business environment is all factors, which influence the organisation to conduct
trade activities, influencing the functioning of the company. These can include the
workers, the leader, supply, management, customers, technology and competitors. It is
dynamic in nature and is comprised of all the factors which influence the working of the
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business and the organisation (Cavusgil et al. 2014, p.23). The understanding of the
concept of business environment is vital in any business activity because, it helps to
learn the organisational functioning and status, including the competition it faces,
helping it to build a brand image in the market. The Australian business environment is
very stable and low-risk in nature. It is because of this reason, that many international
companies, target the Australian market, to spread their business, helping them to
expand their organisation (Hamilton and Webster, 2015, p.1).
The internal business environment of Waitrose is influenced by the management,
customer's demands, supply, employees and adopted technology. The concept of using
a uniform has enabled the company to maintain its functions by ensuring proper
segregation of work, and insurance of equality among all its employees (Harrison, 2013,
p.5). The business environment of Waitrose can be further explained via the consumer
demand of for seafood products, such as canned or packaged prawns, in the retail
organisation (Hughes, 2015, p.298). The employees are recruited and trained for
promoting the company's image in the market, helping them to keep a track regarding
the supply chain by means of the sales, marketing, and retail and logistics know-how. It
has to supply various seafood products by going through various barriers in the supply
chain via middlemen (Byrom et al. 2016, p.186).
The management also sees to the understanding of the problem, so that various
innovative methods and latest technology, to strategize firm-centric activities, which
can be utilised for the sustainable functioning of the organisation (Lee and Vachon,
2016, p.59). They set up various sales and marketing benchmarks, including selling
of cooked fish products, which leftover supply, so as to generate a variety of the retail
products, enhancing the range of choice for consumers (Crandall and O'Bryan, 2015,
p.3). This business environment of Waitrose enables to maintain a good brand image as
a retail organisation, creating a feeling of consumer loyalty among customers, allowing
them to have chances of expanding them business to countries like the USA.
A) PESTEL Analysis of Waitrose:
The PESTLE analysis enables a company to analyse the external business
environment of the organisation, enabling it to understand the functioning of its
business. Political influences from the Australian Federal Government have been seen
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to influence the business of Waitrose, Canberra, Australia (Bloxham and Maharg, 2013,
p.3). It has been noted that many political uprisings, have led the suppliers such as
farmers to initiate the government and various local NGOs, to pass legislations and
policies, which makes Waitrose comply with the laws and corporate social
responsibilities, enabling them to have a proper team and supply chain, helping them to
perform well (Fernie et al. 2015, p.2).
Figure 1: PESTLE Analysis of Waitrose
(Source: Created by Author)
Another significant factor, which influenced the external business environment of
Waitrose, Canberra, Australia, is the environment of the place. Canberra enjoys a
temperate environment (Pearson, 2012, p.7). In addition, the law of banning the use of
polymer bags by stores along with food wastes, made Waitrose, determine the shelf life
of their products, helping them to use strategies of utilising the same, to comply with the
environmental policy (Milne, 2013, p.12).
The society influences Waitrose by manipulating the labour market, influencing its
human resource department to recruit sales professionals, along with people for
logistics and public relations department, which influences the performance of Waitrose
(Devin, and Richards, 2016, p.1). Legal considerations, like various laws and policies
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PESTLEAnalysisPoliticalEnvironmentSocialEconomicTechnologyLegal

including the international laws and those by the Federal government of Australia,
influence the trade activities carried out by Waitrose in Canberra (Fernie et al. 2015,
p.2). These include various corporate acts, food safety acts, consumer policies,
employment policies and environmental laws, which have to be adhered to by Waitrose,
to sustain in the market.
Technological factors such as administration of the logistics department and digital
marketing, for creating a win-win situation between Waitrose and the consumers. The
company uses various tools and innovative strategies, carrying out its CSR (Corporate
Social Responsibilities), by testing the safety and legal compliance of their products,
before putting them on display, as well as tracking the delivery of the products to the
right customers (Mefford and Johnston, 2016, p.77). Being situated in a stable
economy, it has influenced Waitrose to attract customers by choice of variety in
products. Along with this, the recession period has influenced Waitrose to introduce
discounts and offers, to attract consumers, creating a good brand image in the market.
PESTLE analysis enables Waitrose to expand its business to other cities of Australia,
due to the awareness of brands and quality, along with the feature of consumer
sovereignty and free enterprise. However, various reforms influence the trade activities
of Waitrose, by creating an impact upon its supply chain, influencing the growth of
Waitrose (Hughes, 2015, p.298). In addition, urbanisation, travel of passersby, and
advanced technology have enabled Waitrose to increase the scope of market
penetration by using digital marketing and creating variety in choice of products, making
its entry to other Australian cities very lucrative and attractive for the company.
B) SWOT analysis
A SWOT analysis of Waitrose has been conducted in order to understand fully its
strengths, weaknesses, opportunities and threats (Kotusev et al. 2016, p.30).This is
done in order to understand clearly ho9w to approach the Australian market and what
factors should the company improve that will help it to expand its business in Australia.
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Strength
● Attracts capable, talented employees than
other companies because of the application
of the model of Partnership.
● Has motivated and dependable employees
who-who take the work responsibility on
their own.
● Unlike other companies, the level of
turnover is very low.
● The company also gives important
responsibilities of the organisation to its
employees (Hossain and Hossain, 2015,
p.64).
● In decision-making process, all employees
take active participation.
● The company has a strong image present
among the consumers, because of the
high-quality products it provides to its
consumers.
● Recently, the company also excels in
providing quick delivery services.
● The chief concentration is the market
segment where the possibility of earning
product is higher.
Weaknesses
● Trying to make a kind of differentiation
regarding while selling products. Although
the cost is added, the value addition is hard
to communicate.
● The process of participation in decision
making is a good take but it slows the
speed of decision making, which makes it
difficult to take major decisions on time
(Mora, 2016, p.93).
● The company follows a single method of
bonus; however, it may not be so helpful in
the higher position in which other
companies provide better offers.
● Unlike the other large companies like
Sainsbury and Tesco, this company
lacks the fund to make huge investments.
● The way their compensation system works,
it may encourage its employees to become
lazy and inactive.
Opportunities
● Most of the Australian people are internet
users. Hence, the company can promote
itself by making its own web pages, SEO.
Apart from this, it can also use the various
social media platforms like Facebook,
Threats
● A new competitor in the same market may
pose a risk for the company.
● Other competitive giants like Tesco,
Sainsbury etc are also looking to expand
their business; hence this is also a threat
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Twitter to promote its contents.
● The motive of “community matter” also
helps to get positive publicity among
consumers.
● To achieve more share in the market in
coming future.
for the Waitrose company.
● It is not easy to establish its place in
Australia where other huge companies are
also present.
C) Porter’s Analysis of Waitrose:
The competitive analysis of Waitrose has been conducted by analysing its status in the
market with help of Porter's Five Forces model. Waitrose has many rivals in Australia, of
which Coles Supermarket is one. Being a stable market makes the Australian market
very attractive for firms to expand their business in (Hingley et al. 2016, p.229). This
makes new firms arrive, with a similar choice of products, making the competition
intense for Waitrose, making the company have a medium threat of new entrants.
Waitrose shares a high degree of rivalry with other firms, especially with Coles
Supermarket. The company has to use various strategies to make its marketing mix and
business environment strong in nature, to facilitate it to compete with other firms like
Coles Supermarket, enabling it to gain a competitive edge (Wheeler, 2012, p.9).
It has been noted that Waitrose faces a medium threat of substitutes. Waitrose has to
cater to the requirements of the consumers, by adhering to various laws and policies of
the Federal government of Australia. They have also taken initiatives towards catering
to the consumer sovereignty, by provided with a vast range of products at attractive
offers to the customers, which attracts the customers, helping it to gain more consumer
loyalty (Fernie et al. 2015, p.2). This helps it to create a brand name in the market,
making it gain a competitive edge in the market, which enables the company to increase
its scope for business expansion to other Australian cities.
Waitrose has a medium bargaining power of buyers. Even though Waitrose earns its
profits by selling grocery items at standard prices, it has various other rivals, who
provide similar services, making them switch over to the service of other firms like Coles
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Supermarket, when necessary (Devin, and Richards, 2016, p.1). Further, rumoured
information about products among buyers can lead to loss of consumers for the
organisation, leading to decrease in demand for their products, which can lead to loss of
competitive advantage for the firm.
Along with this, Waitrose has a medium bargaining power of suppliers, since the
suppliers are highly aware regarding various policies, having great know-how about the
production and social responsibility towards the employees and the consumers.
Suppliers bargain to increase profits for themselves (Chimhundu et al. 2015, p.368).
Hence, if Waitrose does not strike deals to have a win-win outcome for buyers,
consumers and the company, it will not be able to earn profits, losing the competitive
advantage, resulting in a decrease in position in the retail market.
The Porter’s analysis conducted above, helps Waitrose to know about its competitive
status in the market, by studying its extent of market penetration in the retail market of
Canberra, helping to understand, whether it still needs to concentrate on market
penetration. If it should expand to another city in Australia, attracting more and more
consumers for earning profits, by providing clients with consumer sovereignty and
option of digital marketing with mobile apps and websites, along with shopping at store
outlets.
Conclusion:
From the above report, it can be concluded that the functioning, growth and sustenance
of business activities of Waitrose, influenced by its external and internal business
environment. It can be further concluded that the company has a strong image among
its consumers because of its talented employees and wide range of product offerings,
and has a great opportunity to carry out business expansion in Australia, due to its
stable economy. It can be further concluded that Waitrose Company faces high rate of
competition in the market from upcoming companies, rivalry with companies like Coles
Supermarket, substitute products, and power of buyers and suppliers.
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