Case Study Of Sainsbury's Internal Growth Strategy

Section A

A1

a) Retailing is how producers of goods and services get their products to you. Retailers get them directly from the manufacturer, which turns commodities into a finished product. They also buy the manufacturer's products from a middle-man, known as a wholesaler. This company consolidates the products from around the world and repackages them for easier marketing and distribution. Retailers are the last stop of the supply chain.

b) Every firm has to develop its own growth strategy according to its own characteristics. A strategic plan formulated and implemented for expanding a firm’s business is called growth strategy.

Sainsbury had both internal and external retail expansions.

Internal growth strategy refers to the growth within

External Growth Strategies:

Foreign Collaboration:

Collaboration means cooperation. It means coming together. Collaboration is the act of working jointly. It is a process where two people or organization comes together for the achievement of common goal.

With the advent of globalization, foreign trade and foreign investments are encouraged to increase the volume of trade. This concept gave rise to foreign collaboration to acquire expertise in the manufacturing process, gain technical know-how and market or promote the products or services to the foreign countries.

c) There are 7 main types of retailers which can be defined by the size of their business and the way they in which they sell their products.

They are:

Department Store – This type of retailer is often the most complex offering a wide range of products and can appear as a collection of smaller retail stores managed by one company. The department store retailers offer products at various pricing levels. This type of retailer adds high levels of customer service by adding convenience enabling a large variety of products to be purchased from one

This type of retailer is highly convenient and is able to supply a wider geographic customer base. E-tailers often have lower rent and overheads so offer very competitive pricing.

Convenience Retailer – Usually located in residential areas this type of retailer offers a limited range of products at premium prices due to the added value of convenience.

Discount Retailer – This type of retailer offers a variety of discounted products. They offer low prices on less fashionable branded products from a range of suppliers by reselling end of line and returned goods at discounted prices.

d) The retail marketing mix is a marketing term that refers to the variables that retailer can combine in alternative ways to arrive at a marketing strategy for attracting its consumers.

A good retail marketing mix must meet the expectations of target customers. Its elements must be consistent with each other to create some form of synergy. And also a good retail mix must be competitive to offerings from competitors.

The following list of typical elements can be used to develop a strong retail marketing mix:

Product (Merchandise)

• Product development

• Product management

• Product features and benefits

• Branding

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