INTRODUCTION In this essay, I will perform a five forces analysis on the food industry. There is a wide range of both large and small firms in the food industry. This is one of the reasons why firms such as Kerry Group produce such a rich variety of foods and food ingredients in their sector, e.g. LowLow, Dairygold, Charleville, Denny, etc. FIVE FORCE ANALYSIS OF THE FOOD INDUSTRY Firstly, I will analyze the buying power of customers in the food industry.
Economies of scale are considered as one of the critical factors of success in grocery retail industry and economies of scale are therefore a substantial barrier to new entrants. Lack of access to distribution channels is another significant disadvantage since the majority of attractive locations for grocery stores are already taken by supermarket chains. 2. Rivalry among established companies In North America, Kroger, Costco, The Home Depot, Walgreen, Target and CVS Caremark are the biggest direct competitors, as they offer very similar variety of goods to their customers. Kroger would be Walmart’s direct competitor.
Low global presence: Although the company is the largest retailer in the world, it operates in few countries outside the U.S. This can be detrimental in future, if the U.S. market staggers. Opportunities i. The growing trend of healthy eating: this trend has led to higher demand for grocery products. This is an opportunity for Wal-Mart to expand its grocery store and increase its income from this field.
Private label success In the idea of increasing sales, Tesco started using private labels to sell the product with which they tried to give almost same quality of top brands with cheap price. Tesco labels it as "Tesco value". Items which they sold using private labels were bakery, meat, ready meals, deli, dairy, HBC, wine and non foods. Different Store Formats To attract more customers, Tesco has divided its stores in six formats differentiated by size and the range of products and each providing a different shopping
Walgreen: • The number of acquisitions is not so high and it depends more upon the organic expansion. • These pharmacies face informative and predictable risk from the variability of “generic conversion” • Inability of the company to keep stride with the growing private labeled brands popularity. • The in-store implementation of the store formats and services is not consistent at every
Due to the high volume of people who shop in supermarkets one individual does not hold much power. However, as a group, individuals can hold greater power. Supermarkets must be aware of their customer needs and be responsive to changes in the market. Due to the low switching costs and the availability of substitutes, it is easy for customers to move from one shop to another. This has been even more prevalent since the start of the downturn in Ireland as people are more price-sensitive and more likely to look for bargains and competitive prices.
According to Ndhlovu (2011), people engage in street vending for different reasons, out of the total sample of 30 street vendors which includes former market traders, it was reveals that the majority of about 40% engage in street vending because they easily access customers due to the high volume of movement of people within the Central Business Districts (CBD). On the other hand, 30% sell in the streets because it is easy for them to acquire space within the CBD where there are no formal application procedures and this saves them from incurring costs. However, 23% of the traders refuse to move into the site because they believed that they would be expected to pay monthly rentals. They did not like the idea of paying rent hence decide to sell in the streets to avoid paying rent in the formal markets and the remaining 7% due to not having enough capital to sell sufficient goods in the market. These findings are in agreement with De soto‘s argument that, the informal sector grows because traders try to avoid the cost of formality in terms of strict rules and regulation, taxes, time and effort involved in complying with formal state procedures (De Soto
If it were not for some under-performing units, the inadequacy would be obvious. It is almost as though the seating were designed for the first year sales only. As sales and customers increase, seating in the food court will become inadequate. Furthermore, seating determination often does not take into consideration the mall 's shopper age
The risk it involved is likely the reason why it is not favorable among other shoppers. We can 't blame them because we hear and see all these things happening every day. For an average earner like me, I can 't afford to throw out my hard-earned money just as easy as that. Not everyone in the Philippines owns a bank card to make online payment.
Ansoff Matrix Strategic decisions are often based on by the company can use its existing competitive advantages in the process of promoting the value and capital growth (Lynch, 2009). However, sustained competitive advantage on how to perform these operations largely depends on the company. (Porter, 2008) The need for business development and expansion has been known to promote the product and marketing innovation, which in turn prompted them to take the basis of the different organisational strategies, it based on products and target markets (Ansoff, 1984). In 1957, Igor Ansoff, Ansoff matrix developed to highlight four strategic options(Figure 1), through the organisation of possible new or existing products to adapt into a new or existing