Competitive strategies employed by Retail Supermarkets in the UK: A comparative study.
2. Research Background:
This research background focuses on competitive strategies employed by retail supermarkets in the UK.This background will give a general idea as what to anticipate in the report on strategies approach of leading retail supermarkets of the UK. Retail strategy is an overall plan or the agenda of action that has to follow by the retailer to get the success in the retail supermarket competition. (Barmen, B. & Evans, J. 2006).The retail supermarkets environment has become tremendous competitive in recent years .Top supermarkets like Tesco, Asda, Sainsbury and Morrison are heavily investing in infrastructure to bring higher quality product then their rivals. Retail supermarkets industry in UK has high development in their service by using advance technology, increasing product range, speed and quality. (Harvey, 2000). (Source: BBC news, 9 March 2006)
Above diagram shows the market shares occupied by top retail supermarkets and other grocery markets in the UK on 9 march 2006. According to above diagram top four retail supermarkets of the UK hold 74.4% shares of total grocery market on 9th march 2006. Tesco is the number one retail supermarket by griping 30.4% market shares in the UK. Asda, Sainsbury and Morrisons are the main competitor of Tesco by holding 16.6%, 16.2 % and 11.2% shares respectively. We can see very tough competition between retail supermarket in UK and Tesco looks more successful to overcome its competitor. Today these top retail supermarkets dominates grocery retailing in the UK. The industry construction is characterized by many attributes such as greater store size, lowering prices of goods and adopting different formats to satisfy the consumers’ expectation. (Andrew Holingworth, 2004) According to me retail supermarkets in UK are highly competitive which is good for consumers because aim of some organisations is to increase sales so they need to keep low price and in this competitive environment all organizations must be alert about changing needs of consumers and strategies of rivals.
3. Oraganisation Background:
Tasco is number one retail supermarket in the UK now, which is founded by Jack Cohenin 1919. The first store-brand product sold by founder was Tesco-Tea. Tesco has spread its business all over the world of which 2,184 retail supermarkets are in the UK. Tesco’s UK supermarkets are divided into various formats differentiated by size and the range of product such as Tesco extra, Tesco superstore, Tesco metro, Tesco express and one stop where it offers fresh food and non food product like DVDs, books, clothing, health, garden furniture, electrical, home entertainment and also pharmacies. Tesco also has its other businesses like garden centres, Tesco personal finance which offers credit cards, loans, mortgages, saving accounts and insurance of car, home, life and travel. It also operates ISP, mobile phone, home phone and VoIp businesses. Tesco has its petrol pump at many places in UK. It offers lot of facilities like online shopping from its web site i.e. www.tesco.com at low price and club card scheme to its customers. (Tesco, 2008)
J Sainsbury plc:
J Sainsbury is UK’s longest retail supermarket chain of 509 supermarkets, 276 convenient stores and Sainsbury’s bank. It was founded by John James and Mary Ann Sainsbury in 1869. Bacon was the first own-labeled product of Sainsbury. That time it has department of dairy, bacon, hams, Poultry and games, cooked meats and fresh meats. Now it has around 30000 fresh food and non-food products. Apart from this Sainsbury also has its Sainsbury’s bank which offers car, life, home, pet and travel insurance also offers loans, credit cards and saving accounts. (J Sainsbury, 2008). J Sainsbury was the UK’s leading retail supermarkets up to mid-1990s until it was overtaken by Tesco. (EL-Amir, A. and...