SWOT
SWOT is an acronym which contains Strengths, weaknesses, Opportunities, Threats. Strengths and weakness are internal environment of a company. Opportunities and threats are external environment. These are widely used by managers who can have a simple overview of the strategic situation of a company (Pearce & Robinson 2003, p. 134).
Strengths
Woolworths shares 37.3 per cent market shares in Australia. It has 961 stores around the Australia and has 111000 employees in Australia (Woolworths Limited 2016). Also, Woolworths and Coles share more than 70 per cent market shares in Australia and Coles shares 32.5 per cent market shares (King 2016).. This means Woolworths is a strongest supermarket chains in Australia. This can help Woolworths create …show more content…
This is an advantage but the problem is Woolworths only operate in Australia and New Zealand. The most of revenue of Woolworths is from Australia. In contrast, ALDI is an international company which is a third biggest supermarket chain in Australia as it shares 12.1 per cent market shares in Australia (Roy Morgan 2016). This means that the situation of Australia can directly affect the condition of Woolworths. For example, if the economy of Australia is decreasing, then the revenue of Woolworth may also decrease. The government regulation may also affect the whole strategy of Woolworths as most of it stores are staying in Australia. Moreover, although the Homebrand of Woolworths is 27 per cent cheaper than ALDI, the customers do not trust the quality of products of the Homebrand of Woolworths and they think that ALDI has a better quality than the products of the Homebrand of Woolworths (Low 2016 & Davis 2016). Also, the label of the Homebrand of Woolworths is plained by red and white which was seems like a cheap quality. In contract, the label of ALDI not seems like generic one (Murphy …show more content…
Woolworths needs to make an entry barrier to Lidl. Although the ALDI succeed in Australia, it does not mean all of this kind of grocery chains can success in Australia. The Lidl did not open grocery store in Australia. This means Woolworths need to accelerate the combination of the Homebrand and Essencial as this is the first way of Woolworths to compete with ALDI. If the step of combination of the Homebrand and Essencial has been successfully done by Woolworths, Woolworths may keep its customers and it may attract more consumers from other grocery chains in Australia. The factor that customer prefers to go to ALDI is not only for the cheap goods. The one of most important factor is the customer thinks the quality of the Homebrand of Woolworths is not good. The label of Homebrand of Woolworths is painted by red and white (Murphy 2016b). Also, the Essential of Woolworths is also painted by red and white, the only different part is the word which is Essential is black. Woolworths may need to recreate the color of the label as it can be seen as a poor quality and cheap one. If the viewpoint of customer can be changed in the quality of the goods of own brand of Woolworths, then Woolworths can keep its market share and other customers may come back to Woolworths. Moreover, the food and grocery industry code of conduct has been signed by Woolworths and its suppliers. Therefore, Woolworths should find other good
SWOT is an acronym which contains Strengths, weaknesses, Opportunities, Threats. Strengths and weakness are internal environment of a company. Opportunities and threats are external environment. These are widely used by managers who can have a simple overview of the strategic situation of a company (Pearce & Robinson 2003, p. 134).
Strengths
Woolworths shares 37.3 per cent market shares in Australia. It has 961 stores around the Australia and has 111000 employees in Australia (Woolworths Limited 2016). Also, Woolworths and Coles share more than 70 per cent market shares in Australia and Coles shares 32.5 per cent market shares (King 2016).. This means Woolworths is a strongest supermarket chains in Australia. This can help Woolworths create …show more content…
This is an advantage but the problem is Woolworths only operate in Australia and New Zealand. The most of revenue of Woolworths is from Australia. In contrast, ALDI is an international company which is a third biggest supermarket chain in Australia as it shares 12.1 per cent market shares in Australia (Roy Morgan 2016). This means that the situation of Australia can directly affect the condition of Woolworths. For example, if the economy of Australia is decreasing, then the revenue of Woolworth may also decrease. The government regulation may also affect the whole strategy of Woolworths as most of it stores are staying in Australia. Moreover, although the Homebrand of Woolworths is 27 per cent cheaper than ALDI, the customers do not trust the quality of products of the Homebrand of Woolworths and they think that ALDI has a better quality than the products of the Homebrand of Woolworths (Low 2016 & Davis 2016). Also, the label of the Homebrand of Woolworths is plained by red and white which was seems like a cheap quality. In contract, the label of ALDI not seems like generic one (Murphy …show more content…
Woolworths needs to make an entry barrier to Lidl. Although the ALDI succeed in Australia, it does not mean all of this kind of grocery chains can success in Australia. The Lidl did not open grocery store in Australia. This means Woolworths need to accelerate the combination of the Homebrand and Essencial as this is the first way of Woolworths to compete with ALDI. If the step of combination of the Homebrand and Essencial has been successfully done by Woolworths, Woolworths may keep its customers and it may attract more consumers from other grocery chains in Australia. The factor that customer prefers to go to ALDI is not only for the cheap goods. The one of most important factor is the customer thinks the quality of the Homebrand of Woolworths is not good. The label of Homebrand of Woolworths is painted by red and white (Murphy 2016b). Also, the Essential of Woolworths is also painted by red and white, the only different part is the word which is Essential is black. Woolworths may need to recreate the color of the label as it can be seen as a poor quality and cheap one. If the viewpoint of customer can be changed in the quality of the goods of own brand of Woolworths, then Woolworths can keep its market share and other customers may come back to Woolworths. Moreover, the food and grocery industry code of conduct has been signed by Woolworths and its suppliers. Therefore, Woolworths should find other good