Executive summary
Woolworths mission statement and main strategy is to deliver to customers the right
shopping experience each and every time.
Woolworths vision is to provide quality products and services to its customers all the time
through price strategies, fresh food strategies and human resource strategies. Woolworths
main strategies are to increase efficiency and be cost effective. To achieve this Woolworths
has integrated and implemented several strategies which include every-day low price
strategy and; Project Refresh strategy. The every-day low prices strategy addresses this,
and attempts to offer customers everyday lower prices through price reductions on all
products. Project Refresh is a strategy designed to drive the cost of doing business down.
Organisational structure, staff leadership and stakeholders all play an important role in
implementing and integrating strategies. Woolworths has experienced great success and
should continue along the same path through innovative, tactful and profitable strategies.
Woolworths fulfilment of its strategies it due to it core competencies and its ability to
reposition itself on the market and efforts to differentiate itself. Woolworths are now
recording their first billion-dollar profit. Due to implemented strategies profit is up 24.3
per cent. Earnings before interest and tax topped $1.7 billion – an increase of 32.3 per cent
(ABC2006)
Table of contents
Executive summary…………….1
Table of contents……………..2
Introduction……………….3
Strategic analysis………………..3,4,5,6
Strategic directions; strategic objectives………6
Key strategies * current…………… 7
Strategic implementation; general perspective……7
Key strategic implementation issues……….9
Evaluation of strategy…………….10
Conclusion……………….. 12
Reference…………………13
Appendix…………………14
Introduction.
Woolworths limited is the second largest retailer in Australia. Grocery represents 85.6
percent of Woolworths business. The reminder includes Big W and other variety stores
(11.8 %) and specially stores (2.7%).Woolworths supermarkets are owned by Woolworths
limited, and are a multi-category supermarket chain.
Woolworths Ltd has annual sales of $38 billion. Major brands are as follows: Woolworths
supermarket, Safeway, Metro, Big W, Dick Smiths Electronics and Dan Murphys
(BUSINESS MONITER2007) (Refer to appendix1)
Strategic analysis. Internal and external.
Analysis of both internal and external elements helps to define ..strategic position and
possibilities. [Strategic analysis] allows for strategic management that manages today from
tomorrow (Viljoen and Dann, 2003)
SWOT Analysis. (refer to appendix2)
* Strengths.
Market share: Woolworths has the advantage of having the largest percent of market share
in the retail and fresh food grocery industry. Woolworths is a powerful retail brand and has
a reputation of low prices, convenience, quality of service, wide range of products as well
as fresh food (which Woolworths is trying to communicate to customers and make a main
strength)
Location: Woolworths has over 700 supermarkets and serves over 13 million customers
Australia wide. There is a Woolworths in almost every major metropolitan shopping centre
in Australia. The large number of supermarkets creates convenience and accessibility.
Woolworths is operating effectively due to its core competencies, such as its unique retail
format, fresh food strategy, 24 hour delivery strategy and the low prices strategy. These
strategies combined ensure that food is always fresh and available, which is hard to
replicate, giving Woolworths a competitive advantage.
* Weaknesses: Woolworths offers many similar products under one roof which may make
it harder for Woolworths to differentiate its fresh or select brands. Woolworths mere size
may present potential weaknesses due to the huge span of control.
* Opportunities: Woolworths is growing rapidly in the Australias fast paced retail sector.
They are moving into new market segments within Australia as well as international
markets such New Zealand and South East Asia. Woolworths are always looking at
merging or forming alliances with other global organisations for example wow joint
venture with the Tata group in India.
* Threats: Woolworths experiences ongoing competition threats from other major retailers
such as Coles, FoodLand and Aldi.
Woolworths experiences price wars with Coles introduction of its price rewind strategy,
which was in response to Woolworths everyday low price strategy.
Coles, as Woolworths has superior access to channels of distribution, which is seen as a
threat. Woolworths must dominate Coles in this area in order to rise above. Because
Woolworths is the largest retailer in Australia they are the biggest target of competition,
locally and globally.
Woolworths prospect of expanding to New Zealand may present many opportunities such
as increased market share and positive reaction from New Zealand retail customers.
However this may also present weaknesses as the New Zealand market may not welcome
the large supermarket as intended. FoodLand enjoys a large market share already in New
Zealand.
Environment analysis.
Pestel Analysis.
This analysis is appropriate in providing understanding of Woolworths internal aspects.
Social: Woolworths encourages its employees to socialise and work in a happy
environment. Woolworths has implemented and integrated a broad range of community
and environmental strategies to give back to the customer and local communities.
Woolworths supports many charities.
Technological: Woolworths 24 hour delivery strategy needs to be backed up by a fully
automated ordering system, which Woolworths have created. Woolworths employees use
hand held ordering devise that are used everyday in store and allows ordering to be done
instantly. This reduces stockholding and cost and .further improves the quality of
management decision making (Treadgold,. 1996)
Environmental: Woolworths provides a wide range of initiatives that help to achieve a
better and more sustainable environment. In store initiatives include environmentally safe
bags.
Legal: All staff has the opportunity to be train properly. All staff is required to have correct
food handling and safety knowledge.
Porters 5 forces.
Specific/industry environment * Porters 5 forces can be used to analyse specific
environments such as industry analysis, customer analysis, competitor analysis, supplier
analysis. Woolworths is striving for a competitive advantage over other major retailers.
The intensity of rivalry in the retail supermarket industry is low as the retail supermarket
