Case Study Of Morrison Supermarket PLC
Synopsis of the Case
A successful case study of Morrison’s analyzes a real life situation where existing problems need to be solved. Morrison is the fourth largest chain of supermarket in UK. The business is highly focused on food and grocery items. They also serve Yorkshire food retailer serving customers across UK. It is being identified from past analysis of company that, online supermarket shopping is easy at Morrison (Parsons and Broadbridge, 2004). Due to the increasing competition within the retail industry, there are various issues
Identification of problems: According to the new research published by social media insights, it has been found that Morrison is having few convenience stores or lack of online stores. Due to which they are facing extreme negative emotional consumer reactions towards Morrison existing stores and own label food. Customers are not satisfied with their labelled food as well as its quality.There is high level of negative consumer reaction due to which it may lead to decreased sales(Retail Week, 2015). Due to all these factors, the firm is blaming for its continuing poor sales performance. In the past, through consumer satisfaction survey, negative consumer emotions were tracked much more strongly for Morrison. It develops a negative brand image of Morrison more than any other UK supermarkets in the year 2012. Due to the lack of online services consumers are moving towards their competitors. It is the main reason of decreasing performance of company. After going through appropriate sample based research it is revealed that, there is a significantly growing problem for Morrison against other UK supermarkets (Competition Commission, 2013). Online is changing economics of supermarkets in fundamental ways due to which it is essential for Morrison to improve their online services.
Strength: One of the major strengths of Morrison is their large product portfolio. They provide high range of services as well as products to all their customers. In addition to this, they come under the category of one of the biggest four supermarkets of the UK. It helps them in creating positive brand identity in the mind of customers (Eastham, Sharples and Ball, 2007). Further, they are having efficient supply chain and distribution network with more than 130,000 employee strength.
Weakness: Company is highly facing technical issues in their online services as well as offerings. They also suffer from product recall and have limited geographical reach as compared to their competitors. Major weakness of the organization is lack of online store as well as few convenient stores.
Opportunity: They can get several future opportunities such as there is a growing market for organic products as well rising demands of private labels. Company is having higher positive brand image in the mind of customer. Further, due to the increasing growth of grocery business they can get opportunity for overseas expansion. There are various opportunities for diversification and convenience store development.
Threat: Major threat for Morrison is to keep their customer emotionally satisfied with the help of online retailing (Competition Commission, 2013). They are having lack of online stores due to which consumers are moving towards their competitors. Increasing competitive advantage as well as price competition is another major threat. There are several other retail stores which are giving huge competition to Morrison such as Tesco, ASDA and Sainsbury etc.
Major problems in the Morrison
After going through SWOT analysis it has been identified that, Morrison is facing huge problems regarding their online stores. Due to this, they are not able to attract number of customers towards their services as well as they are not able to emotionally satisfy them (Seddon, Graeser and Willcocks, 2002). Further, in order to attain higher competitive advantage company is required make their online presence and essentially start their online retail stores (Kent, 2003). Further, it is being evaluated from above analysis that, from past several years Morrison is facing major problems due to absence of online stores. However, turnover rate of company is lowest among Tesco, Sainsbury and ASDA (Retail, 2013). Moreover, it is essential for the firm to overcome with this problem by identifying some of the best strategies.
Solutions to these major problems
Morrison wants to deliver sustainable, long term as well as fresh food and quality services to their customers. From the analysis of past data it has been found that, there are various problems which are faced by Morrison due to some major issues (Joshi, Kathuria and Porth, 2003). They are highly struggled to keep their performance on track due to various issues faced by them. Over the past years, the grocery market and its consumers are continuously facing several challenges. Customers are not highly satisfied with the labelled food of Morrison as well. They need to develop their online brand identity to make their consumer satisfy. With the help of providing them online services customers can enhance their shopping experience and save their time as well. Due to the negative consumer feedbacks about labelled food products of Morrison, they can go in non-food business zone. On the place of food business, there are several services which can be implemented (Seddon, Graeser and Willcocks, 2002). In addition to this, another most effective strategy in terms of market development is overseas expansion as well as developing convenience stores. With the help of these strategies they are able to attain their target customers. Morrison can establish small convenient stores in town for which they need to get appropriate planning permission.
Best solution to be implemented
Among several solutions one of the best solutions for Morrison is product development strategy. Under this, they can introduce an online shopping store such as TESCO.COM etc. For this, some of the preliminary steps which they need to take into consideration are as follows:
- Development of a robust website
- Building a viable distribution network
- Ensuring proper stock management
Further, the above given steps are most common actions which must be taken into consideration (Parsons and Broadbridge, 2004). With the help of this, Morrison is able to develop strong brand image in the market. However, the suitability and feasibility of this option can be identified such as:
Suitability: By establishing an online store, Morrison can represent a cultural shift. This strategy is the best and quite suitable in terms of its quick service as well as support for the corporate growth objectives.
Acceptability: This strategy is acceptable as medium risks associated with increasing shopping trends. However, there are several stakeholders of company who are having less interest in the online business expansion of the company.
Feasibility This option is very feasible for the firm as it is easy to design and it also require addition delivery and supply chain management (Sandino, 2007).
How these solutions can be implemented
In order to implement all the above given solution, it is essential for the company to go through appropriate market research first. With the help of this research they can identify the negative feedbacks and comments of their consumers about their company’s services and products. It helps them in identifying areas where they needs improvement. Further, management team of Morrison is required recruit highly professional and experienced technical staff members those who can develop online application of Morrison. It is the best way through which they can start their online services and provide highly convenient services to their customers (Seddon, Graeser and Willcocks, 2002). They can also frame SMART objectives which they need to achieve to overcome identified problems:
Specific: The specific objective of Morrison is to increase their market share by making their online presence and increasing their monthly sales turnover.
Measurable: Morrison needs to increase their growth rate and decline market share by 10%.
Achievable: Company is required to evaluate different market options so that, they can ensure viability of selected strategy.
Realistic: The selected market option must be suitable to all their stakeholders. Appropriate technical staff should be appointed in order to make best online presence.
Time based: Appropriate time should be set in which they need to achieve their target (Joshi, Kathuria and Porth, 2003). For overcoming the above given problems and achieving their desired objectives maximum time is 3 months.
Further, there are various other ways through which all the above given solution can be implemented. Another most effective way is to go through competitor’s website. It helps them in developing more effective and better website than their competitors. With the help of the Ansoff Matrix, they can understand possible growth opportunities as well as several risks associated with them.
Market Penetration: Expansion by acquiring competitors
Product Development: Introducing an online shopping stores
Market Development: Development of convenient stores of Morrison to target huge base of customers
Diversification: Developing non-food business
With the help of overcoming above identified issues Morrison can secure a strong position in the UK food retail sector (Kent, 2003). It helps them in maintaining their declining growth rate as well as market share in a more effective way.
- Eastham, J., Sharples, L. and Ball, S., 2007. Food supply chain management. Taylor & Francis.
- Joshi, M. P., Kathuria, R. and Porth, S. J., 2003. Alignment of strategic priorities and performance: an integration of operations and strategic management perspectives. Journal of Operations Management.
- Kent, T., 2003.Management and design perspectives on retail branding. International Journal of Retail & Distribution Management.
- Parsons, E. and Broadbridge, A., 2004. Managing change in nonprofit organizations: Insights from the UK charity retail sector. Voluntas: International Journal of Voluntary and Nonprofit Organizations.
- Sandino, T., 2007.Introducing the first management control systems: evidence from the retail sector. The Accounting Review.
- Seddon, P. B., Graeser, V. and Willcocks, L. P. 2002. Measuring organizational IS effectiveness: an overview and update of senior management perspectives. ACM SIGMIS Database.