Marketing assignment help on: Morrison Supermarket

Introduction

Morrison Supermarket is one of the leading food chains in the United Kingdom. It is referred to be the fourth largest supermarket in UK. Headquarters of Morrison is at Bradford, West Yorkshire in England.

Originated by William Morrison & abbreviated as Wm Morrison the company had stalls of egg & butter at Bradford. Till 2004, Morrison had stores in North England but now it has stores all across UK.

The brand Morrison currently enjoys the market share of 15.5% & the market share for the year 2008 was approximately 11.8%, was the lowest amongst the four biggest super-markets.

Since, Morrison has its stores all across the city i.e. UK & now it wants to expand its operations in other parts of the world. The country Morrison chose to expand its operations is Sweden.

The basic reason to target Sweden is that, this country has been is that Swedish people are coffee lovers. They are the heaviest coffee drinkers in the world, just after Finland.

People at Sweden have a taste for beer. They love to try new varieties of Beer.

Morrison currently offers wide range of Beer & wine, looking at the taste of the people there; opening a store would be quite profitable.

The Swedish food majorly comprises of boiled potatoes, fish, and some vegetables. Morrison offers a wide range of food items. Starting from frozen food to Pasta, salads which comprises of certain element of dietary food.

Analysis of the basic Competitive Analysis

In order to expand its presence, Morrison should study the market structure of Sweden before operating in this particular market.

Basic competitive Analysis should be done, taking into consideration the Political Economic Social Technical (PEST) analysis, PORTER’s Five Forces Model, etc.

The retail marketing mix should also be taken into consideration while positioning Morrison in Sweden.

By doing a fair competitive analysis, it would have an idea as to whether it would be feasible for Morrison to expand its business or not.

PORTER’S Five Forces Model

http://www.docstoc.com/docs/3606531/Retail-Marketing-Mix-and-Planning

http://www.docstoc.com/docs/9481463/Porters-Five-Forces-Analysis-of-the-UK-Fast-Food-Industry

Swedish and Finnish consumers are gravitating towards fresher, more convenient and more nutritious foods. High demands are made on food quality, origin and environmental concerns. Consumer interest in organic food products has been increasing rapidly. The ongoing socio-demographic changes with busier life styles and increasing single-person households are affecting food retailing to a high degree. Retailers are shifting their product ranges towards an increasing share of healthier, ready-to-eat foods and home meal replacements. Eating out is growing faster than traditional retail sales. Both in Sweden and Finland, about 20 percent of meals are currently eaten out of the home. Fast food is the segment benefiting most from this trend. American-style fast food chains, sushi bars and coffee shops are extremely popular in these markets.

PEST Analysis

PEST analysis refers to one of the basic tools which would help an organization to see its feasibility in the international market. It would help Morrison to see the market growth, decline, potential opportunities, etc.

Before setting up Morrison at Sweden, the company should analyze the environment as well as identify the key variable factors which might affect the demand & supply of the company & in turn affect Morrison’s costs.

There is an ongoing change in the working environment; this change would have an impact on the functioning of the company.

Initially, the environment might look lucrative to Morrison, but due to uncertain changes, the decision undertaken by the company might go hay via. Thus, before entering into an international market, the company should take into consideration the Political, Economic, Social, Technological i.e. PEST Analysis.

In certain circumstances two extra factors i.e. legal & environmental, would be attached to the PEST analysis.

The PEST analysis would look into each & every factor and see whether it would be profitable for Morrison to establish its stores in an international market i.e. Sweden.

After taking into consideration the various factors, Morrison should take a step ahead of formulating & implementing various strategies as well policies.

PEST analysis would help Morrison to assist to break all the assumptions & facilitate an effective adaptability towards the actuality of the new international market.

Political Environment:

Sweden is known as one of the best country all over the world politically. Thus, it would not be very difficult for Morrison to establish & operate in this particular country.

Sweden refers to a country where people have a right to speak & the government intervention is very less. The political environment of Sweden has been ranked 98.6 out of the score of 100.

Coming up with new stores in Sweden would not be an issue with Morrison.

Economic Environment:

The economic condition/environment of any market would help the organization in order to decide whether the company which is going to establish would be profitable or not. Whether, there would be any demand for the company as many other companies are already established serving the people of that market for several years.
After the Second World War, the economic status of the Sweden population has increased considerably. The living standards of the population give a positive indication regarding the acceptability of the Morrison stores in Sweden. The economy as a whole has been continuously increasing after the Second world war, which states that the Sweden economy is highly attractive to start new Morrison stores. By opening more number of stores in Sweden, the firm could expect high amount of profits, the demand would also tend to increase.

While economic conditions and government policy are closely related, they both influence a number of other environmental forces that can affect organizations. Capital markets determine the conditions for alternative types of funding for organizations. They tend to be a subject to government controls, and they will be guided by the prevailing economic conditions. The rate of interest charged for loans will be affected by inflation and by international economics and, although the determining rate may be fixed by a central bank, as it is the case with the Bank of England, that will also be influenced by stated government priorities. According to Thompson (2002), government spending can increase the money supply and make capital markets more buoyant . The expectations of shareholders with regard to company performance, their willingness to provide more equity funding or their willingness to sell their shares will also be affected.

The labour market reflects the availability of particular skills at national and regional levels; this is affected by training, which is influenced by government and other regional agencies. Labour costs will be influenced by inflation and by general trends in other industries, and by the role ad power of trade unions.

Socio-cultural Environment:

The socio-cultural environment encapsulates demand and tastes, which vary with fashion and disposable income, and general changes can again provide both opportunities and threats for particular companies (Thompson, 2002; Pearce and Robinson, 2005). Over-time most products change from being a novelty to a situation of market saturation, and as this happens pricing and promotion strategies have to change. Similarly, some products and services will sell around the world with little variation, but these are relatively unusual. Organizations should be aware of demographics changes as the structure of the population by ages, affluence, regions, numbers working and so on can have an important bearing on demand as a whole and on demand for particular products and services. Threats to existing products might be increasing: opportunities for differentiation and market segmentation might be emerging.

Technology is widely recognised by various literature on strategic management (Capron and Glazer, 1987; Johnson and Scholes, 1993; Jan, 2002), as part of the organization and the industry part of the model as it is used for the creation of competitive advantage. However, technology external to the industry can also be captures and used, and this again can be influenced by government support and encouragement. Technological breakthroughs can create new industries which might prove a threat to existing organizations whose products or services might be rendered redundant, and those firms which might be affected in this way should be alert to the possibility. Equally, new technology could provide a useful input, in both manufacturing and service industries, but in turn its purchase will require funding and possibly employee training before it can be used.