Save a Lot Strategy

Topics: Retailing, Aldi, Wal-Mart Pages: 16 (5114 words) Published: September 24, 2010
Aim: Provide a detailed retail audit containing market entry strategies, competition and the market place and a retail strategy plan that will allow Save a Lot to secure a bank loan in support of their Australian Franchise Context: Save- A- Lot is a discount retailer seeking to expand into the Australian market place targeting high discount and low price seeking consumers. Their market entry strategy is to franchise their brand and use a market expansion strategy when moving to the Australian market place Structure: The first section of the report addresses market entry strategy and the retail planning process. The report then moves to discuss the situation audit which entails competitor and market place analysis. The final section discusses the retailing strategy and offers recommendations to Save A Lot.

Market Entry

Save-A-Lot’s market entry mechanism is Market Expansion as they are expanding into a new market place by franchising their brand (Appendix 1). This entry strategy is a cost saving strategy as a franchising strategy will promote rapid growth without the establishment costs, no direct staff employment and economies of scale in buying in buying stock and marketing (Inside Retailing, 2010). Subsequently, by franchising their brand, Save-A-Lot will inevitably lose aspects managerial control over their franchise in Australia. However, despite the lack of perceived control, this market entry strategy will reduce costs which will help with Save-A-Lots overall business strategy of offering consumers quality merchandize at low prices and remain profitable (Levy, & Weitz, 2009)

Retail Planning Process:
[Table 1.0]: This table illustrates the retail planning process that is conducted by Save A Lot in order to define their retailing mix and corporate strategies upon entering the Australian market.

Table 1.0 Retail Planning Process
Retail Planning ProcessSave A Lot in Australia
1.Define the business mission“We will provide neighborhoods with superior grocery shopping experience enhanced by local expertise, national strength and passion for our customers” ("Save a lot," 2010). 2.Conduct a situation audit: Market Attractiveness analysis, competitor analysis, Self analysis.

Refer to Table 1.1 for Market Attractiveness analysis
Refer to Table 1.2 for Competitor analysis

3.Identify Strategic opportunitiesWithin Australia, there has been an increase in consumer savings and a declining rate of consumer expenditure, a direct result of the economic recession. However with the economy self correcting, many consumers are far more price sensitive. This is a good business opportunity for Save A Lot to position the organization as a discount supermarket where the industry is growing. 4.Evaluate Strategic alternativesThe grocery and food industry is a growing industry in Australia and is an opportunity for Save A Lot to enter the market. They are able to capitalize on the current trend in consumer behave which is the need for cheaper, value for money products as well as convenience as time pressures is a growing problem in Australia. 5.Establish specific objectives and allocate resourcesSave A Lot specific objectives is to enter the Australian market and provide quality merchandise at lower prices. Storage and stock keeping is vital for Save A lot to compete with a low cost strategy and resources are allocated developing and maintaining efficient supply chain system rather than marketing and public relation. Through there proficient supply chain systems they have a distinct point of competitive advantage over competitors. 6.Develop a retail mix to implement strategyRefer to: Retail Strategy Table 1.4 7.Evaluate Performance and make AdjustmentsUnable to evaluate performance at current time

Situation Audit:
[Table 1.1]: Is a situation audit that contains 4 main factors; Market factors, competitive factors, environmental factors and self analysis (strengths and weaknesses)...

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Australian Bureau of Statistics, (2006)
Blakemore & Son Ltd, A.F. (2009). Spar. Retrieved from
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CommunityManager.NET,(2010). Strong economic credentials. Retrieved from, Accessed 21st August 2010
Inside Retailing, Initials. (2010). About Australia’s retail industry. Retrieved from, Accessed 21st August 2010
Levy, Michael and Barton A
Metcash Trading, (2010). About Iga. Retrieved from accessed 21st August 2010
Neblett, J
Save a lot. (2010). Retrieved from, Accessed 21st August 2010
Wallop, Harry (2008)
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