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The Key Macro Factors that Have Influenced the UK Grocery Retailing Industry since the Early 1960s - Assignment Example

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"The Key Macro Factors that Have Influenced the UK Grocery Retailing Industry since the early 1960s" paper analyses the current attractiveness of the UK supermarket and superstore segment and the strategic directions and methods employed by Tesco in pursuit of growth…
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The Key Macro Factors that Have Influenced the UK Grocery Retailing Industry since the Early 1960s
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Download file to see previous pages Johnson et al highlight that external macro-economic factors intrinsically impact strategy management and without accounting for macroeconomic factors in strategy development and management, a business will fail (Johnson et al, 2008, p.3). If we consider this contextually with regard to the UK grocery market; the move demise of the local high street store to the dominance of supermarkets in the past 20 years has radically transformed the grocery market ( Henry, 2008, p.77). For example, the DEFRA Economic Note on UK Grocery Retailing (2006) indicates that in addition to continued growth in the UK Grocery Retail sector; approximately “3/4 sales are made in supermarkets and superstores… with traditional small retailers now accounting for only 7% of sales” (DEFRA, 2006).

It is submitted that a key element of this is an effective interrelationship between corporate strategy management and the exploitation of macroeconomic factors. This is further reiterated by Johnson et al, who opine that it is the environment that ultimately shapes organizational survival in the marketplace (Johnson et al, 2008, p.54). Indeed, the underlying basis of the macroeconomic theory is the interrelationship between performance and behavior in decision making regarding national economies along with a consideration of the various determinants of economic activity (Michl 2002, p.20). A principle macroeconomic model is the dynamic stochastic general equilibrium model, which explains economic growth, business cycles, and monetary and fiscal policy, along with consideration of how the economy evolves over time accounting for random shocks (Colander, 2006, p.1).

This proposition is further supported by the findings of DEFRA in the 2006 report, which highlights that the transformational shift of the UK grocery sector from high street stores to superstore is directly correlated to macro factors (2006). ...Download file to see next pagesRead More
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