The report aims to identified the Woolworth’s currency strategy and provide actionable suggestions for improving the strategy based on the fundamental objectives.
External environment affects Woolworths’ business will be analyzed to clear out the company’s position in Australian retail industry. Porter’s five force analyses are used. The report will also evaluate some internal environment factors, such as Woolworths’ resources and capabilities that impact on strategic decision process. The company’s SWOT analysis is the next part of the report. By using such concepts, the reasonable recommendations will be made in order to improve Woolworth’s strategy and take full advantages of their core competences in their industry.
1. Woolworths’ Overall Business
Woolworths started its business by opening the first store in Sydney in 1924, which was a bargain basement outlet. In 2012, the company has become the largest supermarket chain in Australia and New Zealand, with 28 million customers a week accounted for 31% market share. Woolworths operates a number of brands, which are Woolworths/Safeway supermarkets, Dick Smith Electronics, Big W, Dan Murphy’s, Dick Smith Powerhouse, BWS, and Tandy. Woolworths is one of Australia and New Zealand’s largest retailers in term of sales, revenues, number of supermarkets and stores, and geographic coverage. It has 840 supermarkets across Australia, 156 supermarkets in New Zealand, and also 22 retail stores in India which are the joint venture agreement with Indian supermarket chain Tata. Woolworths’ EBIT at the end of the 2012 financial year was 3,377 million in which the majority comes from Australian operations. Woolworths has listed as a strong financial performance company with a 3.3% average growth rate in EBIT from the period time of 2006-2012.
2. Woolworth’s Corporate Strategy
Woolworths’ vision is “to deliver to customers the right shopping experience each and every time”.
Woolworths’ mission statement is: We, as passionate committed retailers, understand and lead our customers through excellence and a deep knowledge of our products and services and the world we live in. The key strategic priority for Woolworths is to build up a multi-option retailing in term of low price, good quality products and services, in stores experience to meet customer requirement. Woolworths has been ranked as the largest online retailer in Australia and New Zealand and has its goal to reach AUD$1 million sales in online channel by the end of the 2014 financial year and by 2020. To achieve their mission, Woolworths is following its four strategic priorities, including:
Extend leadership in food and liquor
- Re-establish marketing campaign of adding values for stakeholders and boosting business growth in order to expand Australia market share by using reinvigorating progress to Australian retailing industry with a concentration on value, in-store services, and fresh and value products. - Break sales growth point in a competitive environment through Australia’s Fresh Food People’s marketing campaign launched supported by a new and innovative media integration with “The Voice”. - Accelerate leadership in food and liquor
Act on portfolio to maximize shareholder value
- Reevaluate the way Woolworths joint in the electronics business by restructure and divesting Dick Smith - Accelerate alignment of Big W offer to new consumer and competitive reality in term of development and value through improved marketing - Woolworths have already had strong portfolio and been the most responsible implementer of hotels and local pubs, which should be continue in the future
Maintain track record of building new growth
- Be Australia’s the most trusted leader in multi-option retailing - Support innovative start to create a unique, sustainable and profitable improvement - Approach to international market opportunities and new domestic area.
Put in place the enablers for a new...