The Main Problem:
The total sales of Waitrose are continuing to grow in a challenging yet tough grocery environment. Yet the market share of the supermarket is increasing to 5.3% overall in the last year, thereby and incremental of 250,000 more customers are walking through the doors of Waitrose per week.
Though the sales are climbing through the roof, the supermarket store is yet closing stores due to the reins in expansion after the operating profit fell by almost 10% in the six months to the end of the half yearly analysis.
Reasons for Waitrose shutting branches:
1. Overexpansion
The non-typical Waitrose heartlands are the ones of Staines, Leek, Cardiff, and they have not attracted a lot of customers to achieve profitability. The rising costs and fear of the shoppers reining in there spending once the inflation kicks in, is going to make such adventures less attractive.
There is a negative shift of the customers from a big
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Rising costs
The chairman of Waitrose’s parent group, the John Lewis Partnership, warned that the retailers would have to incorporate the big chunk of the additional costs of the imported goods since the fall in the value of sterling after the UK voted to leave the EU.
This also incorporates the introduction of the new minimum wage for over-25s, the national living wage, as well as the new apprenticeship levy, which comes into force in April. This advocated the affected business of Waitrose, more than any of the rivals since most of the business is from the south where the chains are based. The company ensures the improvement in services from its new management styles by making sure the right amount of staff working in the busy times.
5. Increased competition
Well it’s not only the Aldi and Lidl that has affected Waitrose but also Marks and Spencer which is emerging as a new rival of the company, which is expanding at a very fast pace in the recent years and opening hundreds of convenience stores.
The Waitrose Stores marked for