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Discount Store Wars Case Study

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Discount store wars – reshaping the uk grocery landscape The discounters are extraordinary change in the UK grocery market. Its change become permanent structural rather than temporary. Generally, UK have limited of discounters but after initial change on the increasing number of consumers are turning to Aldi and Lid. The increase of discounters have squeezing into the mass market (Big four - ASDA, Tesco, Sainsbury, and Morrisons) and to some upmarket operators. Its success of the discounters could be seen in three dynamics which consisted on physical expansion, widening customer base, and increasing the average basket size. Shoppers have experiences on decline of average price of basket of everyday essential goods for 0.4% (Butler and Wood, …show more content…

Also, the Big Four will need the structural change either to re-establish their respective competitive position and renew of price investment. Local Sourcing According to Liz Morroell (2010), “local souring can not only be cost effective, it can help build community ties”. The trend have growing recently, with the benefit of international sourcing that many retailers are previously favoured. Currently, it both balance from the international souring to provide the mass volume with retails need the local souring to add a point of difference. Either to meet with consumer’s ethical and environmental demands for the products sources closer to their home. For the business, local sourcing have become the established in sales strategy with locally produced goods. Customers pursue to enjoy on the idea of supporting the local suppliers with the substantial price difference. ‘Cost-effective’ for local souring would be more essential for business than ever. It obviously that local sourcing supply chain is generally shorter with leads to greater certainly and predictability of delivery times – just-in-time

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In her essay, “In Praise of Chain Stores”, Virginia Postrel hails the progressiveness of chain stores and counters arguments made against them. As a frequent shopper in my city, I have experienced the benefits of chain stores and how they affect the locals that shop in them. I believe that chain stores have not turned Augusta into a boring city because they are familiar even to those new to the area, they have a high standard of quality and service, and provide fair fixed prices. First, Postrel quotes Thomas Friedman in her essay, stating that “…America is mind numbingly monotonous- the most boring country to tour; because ‘everywhere looks like everwhere else…’ the familiarity of a Walmart to someone new to Augusta may be a relief,

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Introduction As the world we live in today continues to flatten, new channels begin to emerge across the globe. The technological age that we live in today has forever changed they way retailing functions, creating new opportunities for international success. However, the thought of internationalization can be daunting for many retailers, especially due the large history of retailers who have expanded internationally and then failed. Although this type of expansion can be overwhelming, if done properly, the new retail format can generate a great deal of success for the retailer.

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However the UK’s supermarket sector has become more competitive, due to the price drop in various supermarkets, which meant customers would travel and go out their way to shop at a supermarket where they could save money. Which alternatively lead to Asda losing customers, as many supermarkets where competing with each other with the same strategy called ‘price competition’. Customers then would compare various supermarket’s prices before shopping, this made Asda realise they had to deliver quality products whilst selling them at low prices which was keeping the customers happy with the value for their money. Therefore Asda put out a strapline in order to attract customers ‘ASDA Price’ , which put Asda in a better positon than other competitors , but then Tesco copied the strategy by using ‘Tesco Value’ as well as Sainsbury’s using a similar strapline ‘ Sainsbury’s

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ALDI specializes on its own labeled products brand, creates high quality products with fair features, designs and packaging, ALDI also focuses on the variety of products that are mostly needed in each and every household, so ALDI does not only offer food but also offers electronic products, clothes, household goods, health and beauty products. By creating ALDI’s exclusive own brands, ALDI can minimize the costs on the products itself, therefore listing low prices for customers; Also ALDI is fortunate enough for its high purchasing power from suppliers, therefore ALDI can bargain the best prices so it can keep low costs and low prices; Another several ways ALDI is minimizing costs is for example: cart renting, as well as ALDI’s re-usable bags to reduce costs and insure low prices and saving for customers. ALDI took into consideration the importance of locating its stores in places convenient for people and also accessible, also taking into consideration public transportation links and parking spaces available, creating online channels for customers to locate their nearest ALDI store; Yet unlike other supermarket ALDI is not opened for 24H, ALDI’s opening hours are at the times where people are most likely to go shopping to minimize cost. As mentioned before prices aren’t something ALDI can compromise on and one of ALDI’s strategies is minimizing costs for competitive

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In addition to this the above strategies ensure that most of the goods are procured locally, a chain of local suppliers is formed which reduces the overall cost. A survey states that pizza hut procures 95% of its raw material locally hence, enhancing its relationship with various local suppliers, reducing the prices significantly and managing the supply risks and challenges. 2.2 Use Information Technology to create strategies to develop your chosen organization’s relationship with its suppliers. (Criteria 2.2: Use information technology to create strategies to develop an organization’s relationship with its

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