The world economy is in turmoil. Supermarkets are no different, as we discovered during the year - Essay Example

The performance of supermarkets within the global financial crisis is the main issue addressed in this study. The examination of the relevant data has led to the assumption that not all firms operating in the supermarket sector had been adversely affected by the world recession; in fact, where appropriate strategic plans have been applied the performance of supermarkets has been increased. In any case, the financial crisis worldwide has created a strong turmoil the end of which cannot be identified – at least for the moment.

Under these conditions, the performance of supermarkets worldwide has been declined – even if exceptions of good performance have been also noted in the international market. In Britain, the firms operating in the supermarket sector have suffered severe losses – also in this country there have been supermarkets that managed to handle the crisis and increase their performance, like in the case of Simsbury’s. In this paper, the effects of the world recession on the supermarket sector are analyzed by referring to a specific firm: Waitrose.

The specific firm failed in identifying and handling the risks related with the global recession and the changes in the customer preferences. This failure led to the limitation of the firm’s profits without signs for a fast recovery. The response of the specific firm to the challenges of the world recession has been proved inadequate – if taking into consideration the strategic plans used by its competitors. The examination of the British market – and especially of the supermarket sector – leads to an interesting findings: not all supermarkets in Britain have suffered loss of their profits because of the global financial crisis; the limitation of profitability of the firms operating in this sector has been rather the result of poor strategic management.

The above assumption is verified using the principle of Breakeven; the use of this principle for