Australia Woolworth retail
Table of Contents
Executive summary: 3
Introduction 3
Business background: 3
Size of the business: 3
Products and services: 4
SWOT analysis to understand the business model: 4
Strength: 4
Weakness: 4
Opportunities: 5
Threats: 5
PEST Analysis 5
Political 5
Economical 5
Social 6
Technical 6
Ratio and financial performance: 6
Conclusion: 7
References: 7
Executive summary:
In the case study we have considered the retail giant of Australia Woolworth retail. The company has a strong background of over 92 years in the industry of retail sales. It has hundreds of retail stores all over Australia. In this specific case study we are going to discuss about the background of the company in the industry and its market share. The case study also includes an analysis of its strength and weakness along with the political social and technological aspects in which the brand is established.
Introduction
In the following case study we are going to discuss about the business model and the future approach of the business towards its success. Apart from the business model, the case study also includes a preliminary background of the business and the market in which the business is situated in. In this case study we are going to discuss about Woolworth Retail, which is an Australian company (Delaney, 2014).
Business background:
The Australian retail giant has started its journey from 1924. The founders of Woolworth retail include Percy Christmas, Stanley Chatterton, Cecil Scott Waine, George Creed and Ernest Williams.
Target area:
The main target location of the business is in Australia New Zealand and India. The company has an overall of 202,000 employees (Blakely, 2016).
Size of the business:
The size of the business of Woolworth retail is around 59 billion dollars. The operating income of the company in all its internal and other stores comprises of 1.6 billion dollars. The last financial year was not very suitable for the business because the company has faced a loss of almost 1.2 billion dollars.
This is the reason why it is essential to make a business plan for the company in order to make the success story a lot quicker than the usual. Our major name will be to make a plan in such a way that in the next financial year the company can gain as much as 1.5 million dollars (Ward, 2016).
Competitor:
Woolworth retail is the second largest company in Australia. The only biggest said that this company can help from the market is Wesfarmers.
Products and services:
Woolworth retail has an extensors list of products the day offers to its customers. Apart from the Departmental Store and retail store the other main source of income of Woolworth retail is its large liquor store all around the country. Some of the major turnaround times that were proven to be profitable for the company were when it acquired the American Supermarket giant Safeway along with itself in the journey of collaborating with retail in industry.
In 1987 the company has started all new journey of storing and selling of fresh products along with an extensive list of packaged materials. This new initiative has proven to be successful for the business of the company at that point of time (Habre, 2015).
SWOT analysis to understand the business model:
Strength:
- Woolworth is one of the oldest and most prestigious retail brands in Australia. This makes the brand one of the most authentic and strong point under which the company can plan a lot of new ideas and Business models.
- It has a large market share and a lot of stones all over Australia and New Zealand. The vast expanse of the retail stores helps the brand in gathering her large volume of customers (Ragot, 2014).
- Woolworth retail provides almost all kind of packaged and fresh products in its stores. The company also owns BWS and Dan Murphy’s in Australia. These are one of the biggest retail stores that provide liquor.
- In 1987 the company has started with an initiative of fresh products for its customers. This initiative has helped the company in gaining a lot of support from its customers due to the sustainability of environment.
Weakness:
- The main source of business of Woolworth retail is from Australia and New Zealand. Apart from these two countries the brand has no other retail store in any nationality (Ungern‐Sternberg, 2014). Regardless of the fact that it is one of the largest retail stores in Australia the brand again loses its chance of being one of the largest retail stores in the world due to its options in other countries.
- In the last financial year the company has faced a loss of 1.2 billion dollars. This has been one of the biggest weaknesses of the brand in the recent years.
- In 2012 the company has started its first online retail sale. After starting its online portal the company has started to gain a lot of Orders from the online market. But due to the fact that it started late, there were other competitors that grabbed the market of online retail stores.
Opportunities:
- The brand can offer new proposals and promotional discounts in order to start the process of gathering potential customers from the market (Kong, 2017). This can be done with the help of the large number of retail stores and the vast range of products that the brand offers in its various stores all over Australia.
- It can also be said that in the last quarter of 2016 the retail market has gathered a lot of revenue. So it can be said that with the help of emerging economy the retail sector can gain almost 37% of the market capture.
- Woolworth retail can also get a lot of marketing boost up with promotional activities in social media and online promotions. Since it is a global brand and the number of years it has been with the people of Australia the revenue of the brand can be enhanced.
Threats:
- One of the opportunities of the brand can also be a threat to the economy. The marketing policy of increasing the discount can lead to a competitive market with regard to it’s one and only competitors Wesfarmers.
- The slow growth of online trade in Australia is a point of set for the future business plans of the brand. 20% of the total market is dependent on the online sales of products (Soldo, 2013). Since the brand has started its online market in 2012, it can have a lot of difficulties in gathering potential customers from the online portals.
PEST Analysis
Political:
Woolworth retail is the second largest chain of retail stores in Australia and has heritage of over 92 years in the business.
It has got a huge support from the government since it has been working in the industry for 9 decades.
The products and the consumable goods that the brand offers to the customers are eco friendly and sustainable. This helps the brand in growing nationwide.
Woolworth retail has also an active CSR which helps the company in collaborating with its customers in the market.
Economical:
Apart from its large market area the brand has been facing a lot of issues with the suppliers and they persistent problem.
Woolworth retail is also facing some management issues in the last few years which are causing a lot of economical disturbance in a company.
Social:
The company has been using the strategy of private label in its products which is proving to be a very effective marketing mechanism.
Woolworth retail has also got a very good marketing little opportunity which can help it in going its market.
The marketing team has continuously been looking for new opportunities that can help the brand in going in all sectors of the business in Retail Industry.
Technical:
Since the competitor of Woolworth retail are very much advanced in there technological aspects of marketing, the company is now looking forward to use new marketing strategies.
The company also focuses on using advanced technology in the food industry so that the customers can get the best and fresh products from the retail stores.
Ratio and financial performance:
The measurement of financial performance has been contrasted with the help of calculating the ratio for the company. In the financial year it has been understand by analyzing the annual report of the company that it has secured 8.08% earnings by successfully intervening it operation. In the mean time the company has also secured the liquidity for the respective financial year at 0.84 times which is quite feasible in handling the aspects of retail market operation in the country of Australia. It can be easily said that the potential perspectives of the company in controlling the debt structure is quite efficient. Apart from this, the financial health ratio of the company has been measured with the help of financial leverage which signifies that the company has secured 2.77 times recovery by pertaining the business efficiently in the country of Australia and other adjoining areas. Currently, the return on equity of the company has been valued at 4.80% as the company has secured financial instability in the past accounting year. Moreover, the return based on the invested capital of the company is valued at not more than 5% which symbolizes that the company is structuring to a better shape in the upcoming financial years by determining effective retail market mechanism.
Conclusion:
Woolworth retail has been in the industries for as long as 92 years. It has been able to build a lot of regulation for itself with the quality of products and reliability of its customers. With the help of these features it can be said that the brand will be able to sustain in the recent decline of economic growth in Australia for retail customers. The brand has also started its online process of product sales a few years back, which has not yet reached the desired economic growth it was supposed to. It can be set from a statistical point of view that in the coming 3 years the brand can overcome this loss of time.
In view of the future business plan it can be said that Woolworth retail needs to start its online and digital marketing policies as soon as possible in order together a lot of customers. The use of social media and online marketing platforms can help the brand in engaging with his customers a lot more. These are some of the key features that can help the brand in growing its reputation in the market.
The large number of retail stores of Woolworth retail in Australia will also help it in gaining the desired amount of customers. The brand can also get favorable results in cause of financial upliftment is it can make aggressive promotional activities in order to sustain in the market of Retail Industry.
References:
Arli, V., Dylke, S., Burgess, R., Campus, R., & Soldo, E. (2013). Woolworths Australia and Walmart US: Best practices in supply chain collaboration. Journal of Economics, Business & Accountancy Ventura, 16(1).
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Khin Hla, T., Hegarty, M., Russell, P., Drake‐Brockman, T. F., Ramgolam, A., & Ungern‐Sternberg, B. S. (2014). Perception of pediatric pain: a comparison of postoperative pain assessments between child, parent, nurse, and independent observer. Pediatric Anesthesia, 24(11), 1127-1131.
Ungern‐Sternberg, B. S., Ramgolam, A., Hall, G. L., Sly, P. D., & Habre, W. (2015). Peri‐operative adverse respiratory events in children. Anaesthesia, 70(4), 440-444.
Ward, J. (2016). Keeping the family business healthy: How to plan for continuing growth, profitability, and family leadership. Springer.
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