Supply Chain Management - ALDI Supermarket Australia - Case Study Example

Download file to see previous pages The paper 'Supply Chain Management - ALDI Supermarket Australia" is a perfect example of a management case study. It is well documented that supply chain management form an integral part of most businesses and is important for the satisfaction of customers and business success (Hull 2005, p. 218; Blecker and Kersten 2006, p. 21). Chandra and Kumar (2000, p. 100) define supply chain management as a process involving the coordination of the flow of materials, information and finances from the supplier to the manufacturer, wholesaler, retailer and finally to the end consumers. As such, maintaining an efficient and effective supply chain is critical for a business as it ensures that a company has the right quantity of stock of materials and of the desired quality to ensure the manufacture of products that meets the needs of customers. Having an efficient and properly working supply chain also ensures limited time lag and effective cost control (Cooper and Ellram 1993, p. 45). ALDI Supermarket is one of the companies that understand the value of maintaining an efficient and properly working supply chain. Having an effective and efficient supply chain management has ensured that the supermarket maintains the provision of quality products and services to customers. However, like any other company, ALDI also faces a number of supply chain management issues that it needs to address to ensure the provision of consistently quality products to customers, thus making it an appropriate choice for the analysis. This paper begins by providing the background of ALDI, its business, financial and marketing strategies. It proceeds to analyze the supermarket’s supply chain management activities and use the SWOT framework to analyze the company’s supply chain activities. The analysis will also use GAP analysis to analyze ALDI’s supply chain system and recommend the necessary improvements that ought to be made. Finally, the report will conclude by highlighting the limitations of the analysis and provide further direction for improvements to the system.

• Company Background

ALDI is a German multinational supermarket and grocery company founded in 1946 in Essen, Germany, where its headquarters are based. The company has since grown to become of the leading supermarket chains in the world with over 10,000 stores and an estimated annual turnover of more than €53 billion (Battersby 2013). The company is involved in the retail of a variety of products that includes food, sanitary, beverage and toilet papers among other products. ALDI currently has a presence in more than 18 countries and operates in more than 9,600 locations, including Europe, the United States and Australia. ALDI’s success has mainly been registered in Australia, where the company is the leading supermarket at the moment, having overtaken Woolworths and Coles. The retailer has been able to beat its rivals in the Australian retail market mainly because it provides customers with discounted and consistently quality products. Besides, unlike its competitors such as Woolworths and Coles that struggle with stock out of some of their products, ALDI Australia has ensured that its shelves do not run out of stock through efficient supply chain management, something that has made the supermarket be seen by customers as being reliable.

• Business, Financial & Marketing Strategies

ALDI has emerged as the most profitable supermarket in Australia. Despite training Woolworths and Coles in terms of market share in Australia, the German grocer’s customer numbers have been growing rapidly in the recent years, making it the most profitable grocery in Australia (Battersby 2013). The success of ALDI in Australia is attributed to the effective financial and marketing strategies that the German retailer has been employing. First is that ALDI has adopted an effective product strategy that has enabled it to attract and build strong loyalty with its Australian customers. Unlike its competitors, ALDI has maintained introducing new product lines consisting of fresh foods that attract customers to the supermarket. ALDI has ensured that its customers are served by fresh foods all the time. To achieve this, the retailer ensures that foods products are not allowed to stay for long in the supermarket. Stocks of food products are replaced regularly to ensure that foods are served when they are still fresh (Battersby 2013). At the same time, the supermarket ensures that new product lines are introduced so as to provide customers with variety and many choices. Additionally, the retailer has been able to attract many customers to its retail chains by ensuring that it maintains a good stock of items all the time. This implies that the customer does not have to worry about stock-outs as is the case with some of its rivals.

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