The environment of retail supermarket in UK is highly competitive and Asda needs to act according to the changing business environment and should take new business strategies to improve its market positioning by increasing its market share.
As a competitor in the market, ASDA has been clearly appealing to more price conscious and frugal consumers through their established low price strategy and value proposition.
Two future strategic options are suggested in regards to the resources based strategies. According to TNS Market Researchgrocery market share figures published for the 12 weeks ending 22nd March reveal that the success of the discounters is continuing. The Discounters now account for a 5.
Such performance is indicative of the overall buoyancy but intense competition within the Grocery Sector in the current economic climate. In recent years UK supermarkets have come under increased analysis over their treatment of suppliers, particularly of own-label products, yet the development of strategic supply networks has been an integral part of most supermarket strategies for the past decade.
The UK grocery market was worth? According to Huczynski and Buchananpolitics are inextricably entwined, affecting human behaviour in an organization.
As for employment legislations, the government encourages retailers to provide a mix of job opportunities from flexible, lower-paid and locally-based jobs to highly-skilled, higher-paid and centrally-located jobs Balchin, To meet the demand from population categories such as students, working parents and senior citizens, ASDA employing people from these categories.
Also ASDA has been able to won their loyalty although they operate in an industry with high staff turnover. Above factors can cause to ASDA, with their relevance to costs, prices, demand and profits.
As in any economy, high level of unemployment can cause adverse effect on demand on producing goods which can be largely out of control of the company yet it would reflect on the company effort on marketing mix and performance.
Also the up-coming election also might have effect on retailers with their new legislations on tax and related laws. With their recovery strategy, ASDA has thrived to increase their organic product line and ready meal range The Guardian, Their attitudes towards food are constantly changing.
ASDA has removed all hydrogenated fat from their own label products along with artificial colours and flavours. This has leaded to focus on value-added products and service multiplied by focus on own-label share of business mix, supply chain and related operational improvements due to minimise in costs.
Technological factors Technology as a macro-environmental variable, influence the development of products increasing customer satisfaction via personalized convenient shopping experience. The new technologies benefit both customers and the company.
Environmental factors According to Pettingerit is necessary to consider the effect of operation on the environment in relation to all business aspects. ASDA has taken step towards their environmental obligations by having recyclable packaging, comprehensive energy efficiency programs and carbon emission.
The store also has higher levels of daylight than similar-sized branches. Legislative factors ASDA shall consider of their legal environment they operate with recent legal changes which could affect operations like consumer laws, employment laws covering laying-off, dismissal, working hours and minimum wages and health and safety legislation for safe at work place.
An employment tribunal found the American-owned supermarket chain guilty of promising distribution staff a 10 per cent pay rise to give up the collective agreement negotiated by the GMB union — an act which is illegal under a labor relations law.ASDA food has now strong sourcing and distribution network, they want to maximize their market at the each corner of the country as well as in the abroad.
The parent company 'Wal-Mart' has strategic planning on the market expansion of ASDA food. In the company brought into the market “ASDA living” which was the first general store of the company.
It sold a range of products including clothing, toys, home electronics, health products, homewares, as well as beauty products. Earlier this month Asda revealed a new strapline, ‘Pocket More’, indicating that price will continue to be its differentiating point vs competition despite posting a drastic fall in like-for-like sales of per cent in the fourth quarter of Asda’s introduction of an £11 price point on new release DVDs has backfired, as consumers switch to cheaper retailers coupled with ongoing declines of physical entertainment sales.
Asda switches strategy to win back customers especially at a time when the market is clearly undergoing permanent and rapid structural change. The Financial Times and its .
The latest report from Kantar Worldpanel () put’s ASDA’s market share at %, behind that of Sainsbury’s after suffering a % fall in sales, compared with a % fall in Sainsbury’s, and a % rise in sales at Tesco.