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A strategic analysis of the UK grocery market: the retailer Co-operative - Essay Example

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This paper represents a very detailed strategic analysis of the UK grocery market, which includes PESTEL analysis, Porter’s five forces, Opportunities and threats, Strength and weaknesses, Strategic choice, and Strategy into Action plan of the market.
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A strategic analysis of the UK grocery market: the retailer Co-operative
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"A strategic analysis of the UK grocery market: the retailer Co-operative"

Download file to see previous pages The government of UK encourages the retailers to provide job opportunities ranging from locally based and lower paid jobs to high level jobs, high skilled and centrally located jobs. Retailing giants like TESCO employs students, elderly workers, disables at a large number. Retailing has a great impact on jobs (Ivory Research, 2011). It has been predicted that by 2015, the local government is likely to lose control over the retailers. The government will impose policies on issues relating the large retailers (Dowd, 2006, p. 62).
The economic condition of UK grocery market is resilient to the economic downturn as compared to other sectors. The UK grocery market has shown an increase of about 3.15 from 2009 and amounted to 150.8billion Pound in 2010. The total household sector accounted for 12.8% of groceries making it third largest sector in UK. But the economic factors continue to point towards the low purchasing pattern of consumer. But a great opportunity lies ahead for the food and grocery sector (Nicholson, 2011, p.2).
In UK the population mainly comprises of the retired people than the baby boomers generation. This trend discourages the retail groceries stores as they tend to eat less and also do not prefer travelling to a super market to buy groceries. The change in food habit among the UK population has changed drastically as they are more concerned about their health which has lead to a high demand for organic food.
The technological factors have very much influenced the retail sector of UK.
The supply chain, process and operations of grocery are all influenced by technology. The supermarket has been widely affected by the online retailing of grocery. It has been surveyed that about 70% of the population of UK have accessed to internet. The government of UK has been promoting the use of eco friendly packaging and to add on this the Cooperative Group has been awarded the environmental leadership award (The Cooperative Group-b, n.d). In UK the legal system is in the favor of the retailers, the legislation does not put any constrains to the big grocery chains allowing the retailers more freedom in their modes of operation. The UK law provides three advantages to the retailers allowing the retailers to have more control over their brand production (Song, 2011, p.15). Porter’s five forces The UK grocery sector is highly dominated by the supermarket chains such as Tesco, ASDA, and Sainsbury. They have a huge power over the farmers and food processor thereby dominating the overall market and also because the switching cost is relatively low. The supermarkets produces own brand or through an agreement with manufacturers which they less at a relatively low price making the bargaining power of the buyers high (Sloman, 2004, p.291). The bargaining power of supplier ranges between moderate to low because of the fact that there is only big players in the cooperative retail sector as compared to the super markets and the suppliers are dominated by the big retailers in the food and grocery sector and they fear losing any contract with large supermarkets such as Tesco, ...Download file to see next pagesRead More
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