Woolworths Value Chain Analysis: Framework for Management Accounting

This report provides a detailed value chain analysis of Woolworths, focusing on the management accounting issues within the organization. It evaluates the ability of the value chain to provide a suitable framework for addressing these issues, particularly those related to costing in the supply chain. The analysis highlights how Woolworths uses its value chain to improve information flow, manage inventory, and identify competitive advantages. The report concludes that incorporating the value chain in supply chain management helps address accounting issues and optimize profitability by lowering costs. Desklib provides access to similar reports and study resources for students.

Running head: VALUE CHAIN ANALYSIS OF WOOLSWORTH
Value chain analysis of Woolworth
Name of the Student
Name of the University
Author Note

VALUE CHAIN ANALYSIS OF WOOLSWORTH
Table of Contents
Introduction:...............................................................................................................................3
Discussion:.................................................................................................................................3
An evaluation of the ability of the value chain considering the management accounting
issues:.........................................................................................................................................3
Conclusion:................................................................................................................................5
References list:...........................................................................................................................6

VALUE CHAIN ANALYSIS OF WOOLSWORTH
Introduction:
The present paper seeks to prepare report for analyzing the value chain of Woolworth
by considering the management accounting issues. An accounting management framework
based on the analysis of value chain is proposed in the report. The value chain of an
organization comprised of linked set that is performed internally for value creating activities.
Value chain of Woolworths comprises of different value creating activities and the company
has been focusing on delivering and producing the finest products to the consumers of
Australia.
Discussion:
An evaluation of the ability of the value chain considering the management accounting
issues:
The supply chain management of Woolworths has been transformed by adopting the
principles of value chain analysis. Company actively performs all the prime value creating
functions of the company that is logistics and procurement, marketing and sales and
operations. The supply chain of the company involves cost such as transport, cost to convey
information and transferring funds, which are likely to increase due to various factors such as
mounting cost of real estate, huge cost of capital and fright charges (Pinto et al., 2017).
Hence, it can be observed that the company might face issues with costing in their supply
chain.
Value chain of Woolworths has been so designed that helps in improved flow of
information that would help the company to exploit and identify the new opportunities and
reducing external threats. The improved sales and demand forecasting results from the

VALUE CHAIN ANALYSIS OF WOOLSWORTH
effective implementation of supply chain helps in properly managing the inventory (Jie et al.,
2019). It helps in minimizing the delays due to tracking of activities through supply chain.
Value chain of Woolworths:
(Source: Los et al., 2015)
Value chain activities of Woolworths help the company in indentifying the source of
competitive advantage depending upon the breadth and depth of the analysis. Lowering the
costs associated with the value chain would assist Woolworth in availing the benefits of cost
advantage. Value chain can be used as a tool for maximizing the inbound and outbound
transportation process and negotiating the best prices. When it comes to minimizing the
budget of the company, the information of value chain contributes in making modest
advertising budget that leads to offer the product at affordable cost brought by the lower
marketing cost (Svensson et al., 2018). Organization is able to ascertain better deal with
suppliers and offering quality products at lower cost.
Costing is considered as one of the management accounting issues faced by the
business in their supply chain and value chain dealing with cost is regarded as the strategic
management tool. Development of the method of value chain costing implies an

VALUE CHAIN ANALYSIS OF WOOLSWORTH
operationalization of the management accounting of the analysis of value chain (Los et al.,
2015). Therefore, value chain analysis helps in optimizing the profitability by lowering the
cost
Conclusion:
The analysis of value chain of Woolworths presents that the management of value
chain has broadened the links between various activities. Several issues associated with
management accounting have been identified with the costing issue in particular. By
incorporating the value chain in the supply chain management by Woolworths has helped in
addressing some of the accounting issues. Therefore, it can be inferred that management
accounting issues can be effectively addressed using the framework of value chain.

VALUE CHAIN ANALYSIS OF WOOLSWORTH
References list:
Jie, F., & Gengatharen, D. (2019). Australian food retail supply chain analysis. Business
Process Management Journal, 25(2), 271-287.
Los, B., Timmer, M. P., & de Vries, G. J. (2015). How global are global value chains? A new
approach to measure international fragmentation. Journal of Regional Science, 55(1),
66-92.
Pinto, G. L., Dell’Era, C., Verganti, R., & Bellini, E. (2017). Innovation strategies in retail
services: solutions, experiences and meanings. European Journal of Innovation
Management, 20(2), 190-209.
Svensson, G., Ferro, C., Hogevold, N., Padin, C., & Sosa Varela, J. C. (2018). Developing a
theory of focal company business sustainability efforts in connection with supply
chain stakeholders. Supply Chain Management: An International Journal, 23(1), 16-
32.