Business Skills and Employability - Coursework Example

?Sainsbury Plc. Report By Presented to Sainsbury PLC Introduction Sainsbury is the third largest store chain in the UK and is placed at number 80 in the FTSE 100 companies which indicates its strength in the market. Its core operation is in retail business with the focus being on food and non-food products and services. In fact, it focuses on almost all sectors of the economy including property management, financial services, banking, clothing and energy services. It operates six food colleges responsible for training its staff. The company has been effective in the market as a complete company with diversified products leading to positive rating in the FTSE market. Sainsbury offers online platform for the sale of the various product and services. Its clothing brand is the seventh largest in the TU clothing sector with over 3000 products sold in its stores country wide and internationally (Daugherty, et al., 2009, p. 69). SWOT analysis involves the evaluation of the performance of the company in relation to the prevailing market. The analysis of the strength, opportunities, weakness and threats of the organization will help the manager to establish the position of the company. The understanding of the position of the company ensures that the marketing and communication strategy is developed to improve the performance of the business. For instance, if the competitors have ventured on the elderly population, the company may resort to developing products for the youths thus increasing organization performance. SWOT analysis of the company reveals strengths, weaknesses, opportunities and threats associated with the current and future status of the company (Crawford, 2000, p. 53). For Sainsbury, it is vital to understand the weakness of the business and develop strategies to counter the weaknesses and threats associated with the company. Therefore, the report will address the current status of the company, the threats, weakness and opportunity related to the company. In addition it will offer recommendations for change and improvement of the performance of Sainsbury. SWOT analysis of Sainsbury PLC strengths Sainsbury plc. has several strengths that have made it successful in the market as a service and product provider. it is successful because of the strengths associated with is as a brand which are diverse because of the diverse nature of the company. It has diversified its operation to cover various sectors of the business environment. The strengths of the company are as follows; Diversified investments The company has diversified its operations of the individual business units that are not related. The diversification of the business platform ensures reduced risks. In case of business unit failure, the different sector can support the other area. However, diversification alone cannot minimize risks and thus must be conducted carefully (Hollensen, 2007, p. 56). Over diversification leads to increased capital expenditure leading losses. The organization approach has ensured they invest in areas with the potential of success. The diversification approach has facilitated the development of the different units of the business organization. IT infrastructure The company uses the online platform similar to the Amazon.com, but the focus of the organization is on sports and other sports related accessory. The competitive edge offered by the company includes offering variety in the sports sector, direct linkage with the manufacturing companies thereby developing brand loyalty (Preston, 2012, p. 12). The reduced focus for specific sport equipment and regime makes the company unique giving it an edge over the all-purpose online services offered by Amazon and other platforms. However, the challenge is on developing a market niche and retention of customers. The major competitive factors in the whole process are dependent on the situation analysis of the organization. The current situation indicates brand visibility, loyalty, preference and pricing as the main factors that influence choice of the organization. Brand Strength Brand strength is vital in improving the competitive advantage and in turn offset the increasing competition. The approach by the company in the last five years has been the milestone in the establishment of a global brand (Kapferer, 2008, p. 154). Through focusing on brand pyramid and dynamics encompassing silky design, pleasurable experience, and the interplay between driving pleasure and serenity, the corporation established consistency and high level alignment in the sector. Additionally, the global financial position has been useful in the strength creation which is vital in the wadding off competition. One major financial indicator is the overall growth of the corporation Weakness Despite the positives, the company has several key weaknesses that could lead to serious problem in case of the increase global financial crisis. The company relies heavily on overseas markets which may be affected by the increasing financial crisis and recess (Malaval and Benaroya, 2002, p. 89). After the global financial crisis experienced in 2007 to 2009, changes have been instituted in the financial and banking sectors. The revenue collection of the government was affected by the crisis resulting in the change of taxation. Increase in tax results, in reduction of profit margins of the company. The change in economic growth affects the performance of all the business firms regardless of the specialization. Changes in the social trends can affect the business by altering the demand of the product or service. Opportunities The major opportunity existing in the Asian market is low penetration and improved income levels leading to continuous jumps in the demand for services. This is an opportunity that can be grasped to increase profitability. Secondly, the relocation of the manufacturing units to regions with lower production costs leads to the better and improved profits for the corporation. Additionally, manufacturing units in Europe have huge capacities in line with their vast domestic automobile output (Sandhusen, 2000, p. 56). The creation of the service industry in the organization in 2001 helped in the combination of resources to create an efficient organization. Threats Cross-cultural disharmony is created through the integration of different cultures. The occurrence of disharmony creates a challenge for the corporation and may result in serious problems if not properly solved (Cleland and Ireland, 2006, p. 42). Additionally, the rising commodity price is a major threat for the company because it increases the production cost. The rise of cost of raw material such as steel will create a vital threat to the corporation. Finally, market saturation can affect the corporation in line with the changes in the market demands. Retailer branding strategies for Sainsbury Value creation strategy The differentiation of brands helps in the creation of the brand. The success of the departmental stores in Singapore will depend on the ability to create values. Value cannot be evaluated unless customer’s feedback is obtained. Some of the departmental stores handle issues of value by using a detailed pricing policy that allows for the development of price advantages. The society today believes in the need for products to be affordable while also maintaining quality. Social networking strategy Behaviors and habits are developed through the influence of family and friends. Social programs are useful in the process of developing Brand outreach strategies. The outreach strategies include issues such as allowing the loyal customers to invite their friends try out the new brand. The introduction of the new friend will facilitate the trying of the brand. Departmental stores have a variety of [products as such it easier to achieve brand allegiance due to variety. Social networks present a new platform for communication and public relations development which in turn leads to increased loyalty. Brand outreach strategies are developed based on both the social network platform. By increasing the number of new customers through invitation from friends, the departmental store can achieve greater success due to brand image improvement. Brands offer opportunity by being the social campaigning tool. Creation of social campaigning opportunity by relying on cultural power of their brands for social change leads to the spread of globalization benefits and the improvement of the brand position. The use of brand as a campaigning tool has shaped the socio cultural perspective of the market. Despite the opportunities developed by the brands, they face different challenges including losing of customer loyalty and value (Crawford, 2000, p. 45). Customer expectation evaluation strategy For every product developed customers, perception is vital for success. The brand allegiance and loyalty may be altered with a poor standard. Departmental store in Singapore have a duty evaluate customer perception and restructure the stores pricing and service policy to create a brand that resonates with the customers expectation. The success of the approach will improve brand image and brand loyalty (Shaw, 2011, p. 23). Customer expectation evaluation strategy is a vital the 21st century marketing strategies. The consumer expectation and international trends are creating a new situation for brand development. Singapore departmental stores must evaluate the changes in customer’s tastes and preference in the new decade. The success of a department store in Singapore will depend on the customer expectation evaluation strategy (Kapferer, 2008, p. 24). Status branding strategies The social status of the consumers plays a role in brand loyalty. The definition of status has been changing, but the term is till applicable. Customers want to have a unique product as witnessed in the technology market, where changes in application software and designs have led to changes in preference and taste of customers. Brand positioning strategy Proper positioning of a brand ensures proper communication of the brand attributes to the targeted customers thus, leading to increased brand loyalty from the target market. Brand deals with ensuring that the product or service is more visible to the targeted market segment. Positioning is based on one vital principle: all choices are comparative (Reddy and Acharyulu, 2009, p. 73). Because choices are comparative, brands that distinguish themselves from others makes a better cut in the market thus positioning itself better. Brand capitalization is potential of a brand to be used as collateral in financing of company’s activities (Saget, 2006, p. 23). It can be added on the balance sheet under some circumstances. It can be emphasized that brand capitalization deals with the investment made on the brand regularly leading to increase in sales which in turn increase the value of the brand. This is the treating of brands as accounting assets. Positioning involves the creation of public perception of the brand position. The success of the brand positioning is based on the ability to market the brand effectively thus developing a positive brand perception. Brand simplicity strategy The simplicity is a new concept in the society. The society requires items and products with simplicity. The development of plug and play devices is a testament of the changing preferences. The departmental stores must develop the different simple approaches to issues such as purchasing and product sales. The success of simplicity in basic operations will increase customer preferences because of service quality improvement (Daugherty, et al., 2009, p. 32). Despite the opportunities developed by the brand simplicity, they face different challenges including loss of customer loyalty and value. Brands simplicity can be used to bring change as such they lead to improving the standard of business practice. This is created by communicating with the customers in a way that promote and create social values and effective product design. It can be achieved by continuous innovation leading to maintenance of brand appeal to the customers. The makes brand to be more important than the innovation. The creation of simplicity in terms use and service delivery will depend on the operational strategy developed by the supermarket. Supermarkets offer wide range of products requiring service guarantee which is vital in the service quality (Kapferer, 2008, p. 123). Marketing of “Strong Brands” Strong brands encourage greater cooperation and support by reducing the need for trade incentives. Marketing of strong brands is not affected by price because the price is sustainable. There is minimal price elasticity and consequently creates barrier to the new competitors (Kotler and Keller, 2007, p. 71.). Customer based brand equity model states that the power of a brand lies in what the customers have learned, felt seen and heard about the brand due to their experience. This model refers to the real situation of brands. All strong brands receive acknowledgment through appreciation from the customers as such the more the customers appreciate the brand the greater the brand equity. Goodwill gives authority by creating a name recognition that is earned over time. This can be achieved by continuous innovation leading to maintenance of brand appeal to the customers. The makes brand to be more important than the innovation. When proctor and Gamble developed pampers brand the message was to make mothers happy. The principle of their message is a dry baby is a happy baby thus, if pampers is taken away from Procter and Gamble the result is loss of incentive. The innovation developed has a positive value that is exploited by the brand marketers to develop positive social outcomes. Consequently, it solves social issues by tacking the respective problem. Brands offer opportunity by being the social campaigning tool. Creation of social campaigning opportunity by relying on cultural power of their brands for social change leading to the spread of globalization benefits (Malaval and Benaroya, 2002). The use of brand as a campaigning tool has shaped the socio cultural perspective of the market. Despite the opportunities developed by the brands, they face different challenges including losing of customer loyalty and value (Daugherty, et al., 2009, p. 12). The coca cola company is the example of a company facing this challenge. Other global brands have also been affected by the rise of the technology and increase in new brands in the market. This has led to need for brand marketing. Lately brands have been forced to be aggressive in brand promotion so that the identity of their brand is maintained. Conclusion Sainsbury PLC has been able to achieve success because of the various approaches employed in evaluation and diversification of the investment. Diversification is the major contributor to the success of the company because it offers diverse sources of revenue. Despite the success of the company, there are several challenges that will affect the company in future including increased competition from large retail shops and departmental stores. The opportunities provided by the company are excellent but the main issue of concern should be over diversification. Over-diversification can lead to increased cost of operation which affects profitability. Therefore, the company must evaluate its future goal to ensure success of the whole operation and growth. Bibliography Cleland, D. I. and Ireland, L. R., 2006. Project Management: Strategic Design And Implementation. New York: McGraw-Hill Prof Med/Tech. Crawford, M., 2000. Marketing Research and the New Product failure Rate. Journal of Marketing, pp. 51-78. Daugherty, P. J., Chen2, H., Mattioda, D. D. and Grawe, S. J., 2009. 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