Search

Internal Positioning Analysis of Sainsbury

Organization Selected : Sainsbury's

INTRODUCTION

In order to develop existing products of organisation or for expansion, it is very essential to know internal position of entity for sustainable growth in market. The following report is based on Sainsbury's, which is one of the second largest chains of supermarkets in UK; it covers 16.9% of market share in retail sector. Many organisations use theoretical approaches of well-known strategies to analyse internal position of business. Sainsburry's can use various approaches like Porter's Five Forces Analysis and SWOT analysis for conductin

The marketing environment of any organisation in UK comprises two different levels such as internal environment that consists of specific attributes within an organisation and external environment, which consists of different variables outside the organisation. The research paper will be revolving around tools used to analyse the internal position of Sainsburry's in order to get complete report on internal position.

Internal Position of Sainsburry's

For an organisation, it is very important to understand strengths and weaknesses, which can help in drawing more assets and developing strategies to grow well and sustain in the market. Internal analysis is considered as one of the important tools for mapping different situations to give special emphasis on unique abilities and threats for Sainsburry's (Azeez, W., 2014). There are various ways used by this organisation to carry out internal analysis for formal evaluation of the entity where it would apply SWOT Analysis and for identifying suppliers, competitors etc. of business that has used Porter's Five Forces Analysis. The internal analysis of Sainsburry's incorporates various measures that deliver strengths, weaknesses, opportunities and threats by complete SWOT analysis. The data provided by conducting internal analysis of organisation benefits in way to generate strategic plans for organisation to sustain in competitive market environment (Bull, J.W., 2016).

SWOT Analysis of Sainsburry's

Strengths

  • It is one of the oldest and largest supermarkets of UK with 15.8% market share.
  • This organisation has vast employees’ strength of 150000.
  • The philosophy of business in an organisation leads the market. This organisation mainly focuses on helping customers in living well at less price.
  • Wholesale and retail banking of organisation is very strong. Financial division of retail sector of organisation includes various number of wholesale banking.
  • Each division of store at Sainsburry's shares around 30,000 products in different categories with 20% as own labelled products (Hammad, A., 2015).

Weaknesses

  • Research by various analyst shows that the prices of Sainsburry's are comparatively higher than that of its competitors.
  • In the year 2017, this organisation has experienced the annual decline in profits of 8.2%, which is termed as result of various factors that affects the organisation.
  • There is a strong competition in each segment of the retail sector.

Opportunities

  • The organisation can enter into new emerging markets, which can do partnership with help of joint ventures for expansion in new markets.
  • Sales can be boosted up by introducing self-checkout machines in order to open the stores for 24 hours.
  • The organisation has option to grow business in villages also, because time has gone when individuals in villages were opting to use non-branded products.
  • The company can further expand business in emerging countries, which can offer vast range and number of labours at a low cost.

Threats

  • Like all other supermarkets in UK, Sainsburry's faces the similar threat of strong and tough competition.
  • Increase in globalisation can be a challenge as well as an opportunity for the organisation.
  • There are various players in the retail sector of UK like TESCO and ASDA that offers products at discounted rates, which can decrease the sales of an organisation.

Pricing Tactics of the organisation- The tactics used by the organisation for pricing is totally based on providing its customers about “value of money” and accordingly, quality of products is maintained by ensuring customer retention for its services. The organisation believes in competitive pricing policy rather than price-cutting policy as this pricing strategy of an entity provides a gain in the market share. According to product positioning, Sainsburry's take over good command at price discrimination policy, thereby benefits the firm in obtaining the premium price for products because it makes its own position in the high-end market (Jones and Hillier 2016). This entity provides 'value of money' as it offers basic and kids products at reasonable prices with high quality. Thus, these are pricing tactics followed by organisation.

Sainsburry's is considered as best performer in retail sector of UK, gained 1.2% growth in sales in recent quarters. There are low base prices for products which lead to fill the gap of base and promoted prices. Adding to, organisation is cutting the incentives for shoppers in order to make them wait for the deal of preferred choices and brands of the customers rather than just satisfying the basic needs.

Profitability of Sainsburry's- With growing costs of products in retail sector, there have been huge profits recorded for organisation. Sainsburry's is able to manage with suppliers in order to cut down own cost for making profits and gaining market share (Leiber 2018). There are net profits recorded for this organisation in different financial years, which are as follows:-

Year

Net profit (in Millions)

2008-09

289

2009-10

585

2010-11

640

2011-12

598

2012-13

602

2013-14

716

2014-15

166

2015-16

471

2016-17

377

Customer services of the organisation-The services offered to the customers has been excellent in the years of its operations. The result of good customer services has been produced by the striving phase as well as being passionate in satisfying the customers. Efforts were also made by the government sector to enhance the quality of customer service in retail sector (Katz and Louw 2016). There is a strategy followed by the organisation that is Customer Service Excellence Standard (CSE) which includes effective provision for services, the efficient staff members and empowering individuals to ensure the consistency in excellent customer services by the organisation. Organisation also provides the home delivery services, where the customers can place the order of various goods either online or with the help of telephone. Over 200 ventures of Sainsbury's provide this facility to its customers with the average three quarters of population of UK has been availing the benefit of home delivery.

Promotional methods- Promotion methods are those methods which allows an organisation to connect with its audience in various ways. Sainsbury's uses the traditional method of promotion which includes utilising the television, radio and billboards in order to promote the products.

Operating method- Organisation method of operation supports the sustainable goals of development of the country as it fulfils the social responsibility towards the country and puts much emphasis on ending poverty and inequality. The organisation also writes each employee's job description after giving the targets to its employees which is an efficient way to manage the performance (Leiber and Harvey 2018). With the help of operating method, the organisation aims at three main values of the organisation which are:

  • The organisation offers variety of products and services at reasonable prices.
  • The colleagues at the organisation makes the difference in working style of the organisation from the other retailers.
  • The entity is always there for its customers, in order to help them at every step.

Dealing with external factors

PESTLE Analysis of Sainsbury's

Political factors- Sainsbury's is a leading retailer in UK and Ireland, therefore there are plenty of political factors which influence the working of Sainsbury's. Increase in the globalisation can be an opportunity as well as a threat to organisation. It is a challenge in such a way that the organisation gave to face the competition against unknown forces in order to identify the source of various products with economical as well as quality value. There has been a decrease in corporation tax which was 30% a few years back but now its 28%. therefore, with low corporation tax, Sainsbury's would have saved a huge amount just like the other big organisations in the industry (Punjaisri and Wilson 2017).

Economical factors- One of the major economical aspect that might can affect the organisation is rise in the prices of fuels. Rising cost can affect the supply chain of the organisation which can lead an increase in product prices and can decrease the customer base for the organisation. The ongoing global food crisis can also increase the cost of products. Credit crunch, which is the most evident factor can affect the working of big organisations. It can even have a great impact on the total sales of the organisation as customers have the less purchasing power can lead to a cut in purchase of more luxury products as they will wisely spend their hard earned money and luxury products are considered as one of the good source of income for Sainsbury's. This factor impacts directly on the sales, as the customers will purchase less and there would be less profit for the organisation.

Social Factors- There has been an increasing social trend in healthier foods among the people of UK, so in order to cope up with that social trend, Sainsbury's have to look out for to keep its customer base healthy (Sivalingam, R., 2015). There is a wide range of retailers in UK, so if customers is unsatisfied by the services offered by Sainsbury's, they can switch the retailer as there is wide choice for them. Therefore, the organisation gives proper to their staff members in order to be friendlier with the customers so that they can attract more of customers based on the services provides and there cab be an increase in sales as well.

Technological factors- For the retailers like Sainsbury's it is very important to use right technology in the absolute manner. There are plenty things in the big organisations like checkout systems and inventory management which can't be done manually. Therefore, to cope with the various activities at the organisation, Sainsbury's all over the country have been constantly upgrading the technology like introducing self-checkout systems, upgrading to more efficiently scanning the checkouts, computerised stock controlling etc. having computerised systems means there are less human efforts & errors with less of paper work. One of the great technological advantage includes the online shopping facility, if used in the appropriate manner, it can be a good source of profit maximisation.

Environmental factors- Reduction in carbon footprints has impacted many of the big organisations including Sainsbury's. The organisation can put a lot of emphasis in reduction of carbon footprints and have proved that the entity is not involved in increasing environmental pollution. To accomplish it more, the organisation have to out more efforts towards the green issue.

Legal factors- The organisation has been covered up with many of the legal issues including national minimum wage policy, alcohol selling age etc. (Katz and Louw 2016). For the smooth functioning of the organisation, it has to follow these laws and if failed to do so then there are some consequences which the entity has to bear.

CONCLUSION

The main purpose of the organisation is to generate higher profits. In order to fulfil this objective, organisation uses various techniques to asses the strengths, weaknesses, opportunities and threats. These techniques give a clear picture of the areas to improved by the organisation and analyses the areas in which the organisation is excelling. The report is all about the efficient use of techniques which can be proved as a great advantage to develop the strategies for the organisation.

Visit the sample section of our website and enjoy more such informative write-ups written by our assignment help professionals.

Related Samples

Macro and Micro Environment Analysis of JP Morgan

Global Strategic Management

Download Full Sample
Cite This Work To export references to this sample, select the desired referencing style below:
Copy to Clipboard
Copy to Clipboard
Copy to Clipboard
Copy to Clipboard
Assignment Prime. [Internet]. Assignment Prime.(2020), Retrieved from: https://www.assignmentprime.com/free-samples/internal-positioning-analysis-of-sainsburys
Copy to Clipboard
Boost Grades & Leave Stress

Share Your Requirements Now for Customized Solutions.

Lowest Price
USD 7.03

Delivered on-time or your money back

100+ Qualified Writers

For Best Business and Business Environment Assignment Help

View All Writers
FREE Tools

To Make Your Work Original

  • Plagiarism Checker

    Check your work against plagiarism & get a free Turnitin report!

    Check Plagiarism
  • Reference Generator

    Get citations & references in your document in the desired style!

    Generate References
app Download App

Avail the Best Assignment Writing Services in Just One Tap!

Get the App Today!

iphone android
QRcode