Loblaw Companies Limited’s business strategy of “driving down costs through size and operational efficiencies, and differentiating both its products” has enabled the firm to gain 32% of the food retail market in Canada. Despite this success, Wal-Mart is looking to enter into the mature food retail market with the introduction of their SuperCenters (combining grocery and nonfood items). Wal-Mart is a forceful competitor, and the Every Day Low Prices strategy of Wal-Mart’s Supercenters could wean away traffic from Loblaw’s various value banners. The objective of this paper is employ a PEST analysis and Porter’s 5 Forces Analysis to access the Canadian food retailer industry to decide if Loblaw should continue its current …show more content…
Good analysis above.
PEST Analysis Even though Loblaw’s strategy is a differentiator and has proven to be successful for a long time, Wal-Mart is a dynamic competitor, and the Every Day Low Prices strategy of Wal-Mart's SuperCenters could takeaway traffic from Loblaw's various value banners. A PEST analysis is created to understand the current Canadian food retail marketplace to understand why Wal-Mart believes there is opportunity to enter this ultra-competitive marketplace. The PEST analysis contains external forces that Wal-Mart cannot directly control, like consumer habits, which means Wal-Mart needs to manage their macro environment in a way that benefits them so they can enter the food retailing industry in Canada.
Wal-Mart is the largest private employer in