Strengths and Weaknesses of Home Bargains Retail Companies - Case Study Example

The paper "Strengths and Weaknesses of Home Bargains Retail Companies" is a brilliant example of a case study on marketing. Home Bargains Retail companies a chain of stores that are based in the United Kingdom and offer home bargains. The company was founded by Tom Morris about four decades ago and its first stores were located in Liverpool England. The company has been experiencing tremendous growth in the past decade and is currently topping the list of the UK’s fastest-growing discount retailer. For instance, in 2013, the company published a record-breaking turnover of £1 billion. Carrying out a SWOT analysis can help in establishing the main factors that are fueling its incredible growth (Bargain Shop, 2014, para1-6).

Strengths

            A strong brand is one of the key strengths of Home Bargains (Holland, 2012, para1-8). This giant retail store emphasis is on building a strong brand image that it has been able to accomplish after some time. The company focuses on how it can meet customers’ requirements fully and at an affordable price. As a result, it offers its customers quality products and a relatively lower price compared to other business rivals. On top of offering quality products at a lower price, the retailer also offers a wide variety of products and brands that ranges from brands including health & beauty products, food, clothing, seasonal, toys and games, household, sweets, snacks, to drinks and alcohol, as well as their own range of affordable home style. This makes its stores a ‘one-stop-shop’ that offers a wide variety of choices (Home Bargains, 2014, para1-4).

            The marketing aspect is another key strength of this business organization. Home Bargains Retail Company has been practicing corporate social responsibility (CSR) in a number of ways like sponsoring sports, raising funds for charity purposes, and offering jobs to the locals among other initiatives. This aspect has created a good public image of the company and made its brand be known far and wide. Having a huge number of stores and staff is another major strength of the company (Bargain Shop, 2014, para1-6). Home Bargains Retail Company has more than 320 stores throughout the UK and it is planning to open more than 700 new stores within the next five years (Bargain Shop, 2014, para1-6). In addition, the company has in excess of 10,000 well-trained and competent employees who make its operation smooth.

             Other key strengths of the company include supporting Home Bargains’ growth in its supply chain, having a well-distributed infrastructure that has enabled the company to support a much larger network of stores, as well as having financial muscles, an aspect that has enabled the company to exploit new opportunities immediately a market gap is identified. Recently, the retailer plowed over £35m into the system so as to extend its 350,000 sq ft distribution center (Holland, 2012, para1-8). The retailer also has a transactional website that enables it to transact business online in what is popularly known as eCommerce. This gives it an upper hand in the market because it was among the first retailers in the UK to provide a transactional website that offers click-and-collect.

Weaknesses

            The core weakness of the company is the fact that the organization does not engage in a very active ad campaign despite the extreme competition in the industry (Holland, 2012, para1-8). Other weaknesses include the lack of high margin premium and luxury product assortment since it tends to focus a lot on offering low priced products as well as a lack of unique competitive advantage that should differentiate it from the other major retailers. With regard to management, the company has another weakness because it has employed a few minorities and there are only a few females in the top management. Moreover, the organization’s staffs are not unionized which denies their bargaining power.  

Opportunities and Threats

            The main opportunity for the company is the existence of room for expansion both locally and internationally. Currently, the company has ambitious expansion plans since it is intending to open more than 700 stores in the next five years and employ about 20,000 staff. Completion of the TJ Morris’ purpose-built warehouse and distribution that was built at a cost of £35million was one of its foundation plans that would enable the company to expand easily and rapidly to other regions. Currently, the distribution center services all of the Home Bargains stores across the UK (Holland, 2012, para1-8). Home Bargains is competing with major rivals like Rival Poundstretcher who are slowing its growth and also making competition for getting space in strategic positions fierce.