Wm Morrisons Supermarkets Plc commonly known as Morrisons operates as the fourth largest supermarket chain in United Kingdom. The company is based at Bradford in West Yorkshire based in England. The company focuses on meeting the food and grocery needs of around 11 million customers that visit its different brick-and-mortar retail outlets spread along different regions in United Kingdom. The company operates based on a total of 117,000 internal members that focus on rendering low priced, fresh and quality products to its customers (Wm Morrison Supermarkets plc , 2017).
The grocery market in United Kingdom in recent times has reflected the emergence and growth of discount and online retailers. The rise of discount retailers like Aldi and Lidl has encouraged the shoppers to render reduced spending and investments on grocery items. It is forecasted that by the end of 2021 the hypermarkets and also the supermarket retail formats would gain a stabilisation in their sales revenues with the emergence of larger formats to meet the emerging needs and expectations of the consumers. Further, till 2022 the online and digital retail platform would contribute to around 68 percent of the total retailing activities conducted in United Kingdom (Gladding, 2016). Discount retail formats are taken to value around GBP 24.9 billion by the end of 2021 wherein the further growth would be generated in a measured fashion compared to previous periods. Along with the growth of online retailing, the convenience retail formats would sustain their ranking as third in terms of growth though recording a slowdown along their expansion drives (Retail Economics , 2015). Sales of larger stores are also taken to stabilise along the periods ranging from 2016 to 2021 as reflected below.
(Gladding, 2016)
The above data reflects the changes in the shopping habits of the consumers in the grocery retail market of United Kingdom. Consumers nowadays have potentially switched over from larger retail formats like hypermarkets and supermarkets to more accessible channels like the convenience retail stores and also the online and digital mediums for gaining easy and effective access to a large assortment of products that they can order and avail in a convenient fashion. The change in the consumer behaviour in the United Kingdom grocery retail market is further fuelled by the enhancement of the quality of the convenience stores with also the development of the retailing standards of the online and digital retail formats (Gladding, 2016).
Further, the discount retailers are also observed to earn the advantage of the situation in terms of opening of large number of brick-and-mortar stores for attracting potential shoppers. The larger retail formats in the face of the above challenges are focusing on the generation of simpler and reduced pricing structures for both attracting and sustaining an effective customer base. Acquisition is also on the cards where larger retail companies like Sainsbury’s are using the same for acquiring smaller retail companies like Argos to enhance their current potential. Larger retail formats are also focusing on integrating their traditional brick-and-mortar retail stores with other online applications like click-an-collect being powered by the development of Smartphone based marketing and retailing activities (Gladding, 2014).
The convenience retail formats under the influence of greater expansion and growth are observed to suffer from lack of quality sites for generating further expansion and also for opening up of new stores. The same is accounted for reducing the growth in value of the convenience retail formats along United Kingdom (Gladding, 2016). The same is reflected in the following illustration.
(Gladding, 2016)
Cooperative retail formats are however evaluated to gain needed growth owing to their planned expansion drives and also the selection of product ranges and assortments that would likely meet the needs and expectations of the local consumers. The online and digital retail market continually offering new offers and large number of choices to retail consumers are taken to sustain their growing spree in the coming period. Aldi, operating as a discount retailer during 2016 offered new segments like Special Buys and wine online to entice its customers while AmazonFresh made its debut in the United Kingdom retail market (Gladding, 2016). The expansion drives of the online retail market in United Kingdom is taken to generate a value increment of around 68.3 percent along the period ranging from 2016 to 2021 as reflected in the following table.
(Gladding, 2016)
(Gladding, 2016)
Likewise, the growth of the discounters in the United Kingdom grocery retail market is evident from the following illustration forecasting value enhancements of around 39.5 percent along the periods ranging from 2016- 2021.
(Gladding, 2016)
Overall, the food and grocery market in United Kingdom is forecasted to gain a growth by around 10 percent along the periods ranging from 2016 to 2021 amounting to around GBP 197 billion. The growth in terms of value for the different retail channels along the stated periods is reflected in the following illustration.
(Gladding, 2016)
Large grocery retailers like Morrison have observed that the emergence of price war between the discount retailers and large retail formats is affecting the revenue potentiality of the retail sector thereby discouraging the growth of investment activity in the same. The growth of the price war is taken to reduce the price of the essential commodities procured by consumers on an everyday basis by around 17 percent. The reduction in price levels of the grocery products though is taken to generate short term gains for the customers yet in the long run it would potentially affect the expectations regarding service levels and also needed convenience (Retail Think Tank , 2016). The growth of online and convenience retail has encouraged consumers to conduct bulk purchases of grocery products online and also to make visits along the different convenience stores on a weekly basis for making purchases of different fresh products. The same has affected the market for the larger brick-and-mortar retailers operating in the region. Modern consumers in the grocery retail market in United Kingdom are interested in gaining access and views to larger assortment of products that they can effectively afford and also order in an easy and convenient fashion through use of Smartphones and other digital mediums (Retail Think Tank , 2016).
Further studies reflect that the emergence of discount retailers like Aldi and Lidl on one hand and also the entry of retailers like Waitrose and Marks and Spencer in the grocery retailing sector of United Kingdom has potentially squeezed the market share for larger players like Tesco, J Sainsbury, and Morrison and also for Asda. During 2015, the major four retail players are observed to account for around 72.8 percent of the total grocery sales down from around 80 percent (Ruddick, 2015).
(Ruddick, 2015)
The supermarkets and hypermarkets account for pressure not only from the discount retailers like Aldi and Lidl but also from the emergence and growth of both convenient and online retailers. It is estimated that by the close of the 2019, the sale revenues emanating from discount and convenience stores and also from the online retailing platform would surpass the revenue potential of both the supermarkets and hypermarkets in a joint manner. The sales revenues of the superstores and also the hypermarkets is taken to counter a decline by around 4 percent which in turn would affect their market share in the grocery retailing market thereby making it decline from 42.2 percent to around 34.9 percent. On the contrary, the sales for convenience, online and discount retailers are taken to grow by around 56 percent till 2019 (Ruddick, 2015). The change in the market situation for discount, convenience and other big supermarkets along the period ranging from 1998 to 2014 is reflected in the following graph.
(Ruddick, 2015)
The rapidly growing grocery formats in the UK Grocery Retail Sector are identified to be the convenience, discount and online retailers. The change of the situation of the stated retail formats along the periods 2014 and 2019 is illustrated below.
(Gladding, 2014)
Together the stated retail formats are evaluated to account for around 110 percent of the total cash revenue in the retail market. The demand for online retailing is observed to grow on account of the increased rollout of click and collect applications along different store and also reduced amount of delivery charges (Gladding, 2014).
The emergence of the above stated changes in the grocery market of United Kingdom potentially impacted the business operations of Morrisons. During September 2015, Morrisons on account of falling profits and sales revenues was required to shut down around 11 supermarket outlets that led to around 900 job cuts. Profits of the company accounted a reduction in the level of pre-tax profits for the firm by around a half from GBP 239 million to around GBP 126 million within a span of six months (Ruddick, 2015). Further, the year-on-year drop in the level of sales revenues for Morrisons accounted for a 2.7 percent reduction during 2015 with also making the company lose its market shares to discounters like Aldi and Lidl (Butler, 2016).
Morrisons also required selling off around 140 convenience stores branded as M Local to a millionaire, Mike Green for around GBP 25 million. Subsequent to the closing of around 11 supermarkets, Morrisons also required to shut down around 7 stores during 2015 thereby leading to a further job reduction of around 680 retailing jobs (The Guardian , 2016). The seven supermarkets were closed down by Morrisons’ management owing to the fact they were unproductive and unprofitable in nature and the company failed to generate needed developments for enhancing its sales performances (Butler, 2016).
Specifically speaking the growth of the discount retailers like Aldi and Lidl in United Kingdom affected the market shares of Morrisons thereby making it decline by around 1.4 percent. The closure of the stores generated by Morrisons accounted for a 47 percent reduction in half-yearly pre-tax profits for the firm accounting to around GBP 126 million. Further, it also accounted for the selling of around 140 convenience stores at a loss of around GBP 30 million (Shadbolt, 2015).
In the face of the above changes concerning the grocery retail market of United Kingdom, Morrisons is observed to have entered into a deal with online retailing company, Ocado for developing an effective presence in the e-commerce market. The deal made with Ocado would enable Morrisons to earn space in the fulfilment centre of the e-commerce retailer based in Erith due to be opened during 2018. The same would contribute in helping Morrisons market its products in remote locations. The gaining of around 30 percent warehouse space along Ocado’s distribution centre would help Morrisons in both storing and distributing large numbers of orders on a weekly basis (Sillitoe, 2016).
Moreover, Morrisons has developed strategic partnerships with different companies like Amazon, Ocado and Timpson that would help in reducing the level of prices for the merchandises and also in developing its retail outlets and existing product ranges and assortments. The strategic partnership developed with the stated companies is taken to enhance Morrisons’ potential for enhancing its service quality and also in improving the quality of the different products (Ough, 2016).
Other strategies are also being undertaken by Morrisons like the incorporation of effective coupons and promotional tactics along with the reduction of prices for the different products. The same is taken to enhance the level of competitiveness for the retail institution. Further, the management of Morrisons also has focused on recruiting large numbers of in-store and customer servicing staffs for enhancing the process of checkouts along the different retail outlets (Stevens, 2016).
Morrisons also plans for taking further initiatives in generating different types of wines based on both colour and also of country of origin such that the same helps in generating greater product assortments to its customers. The retail company also strategies its product offerings based on evaluation of personal tastes, interests and also demographic factors. Tailoring of product assortments based on local tastes rightly contributes in enhancing the level of customer satisfaction (Bearne, 2015).
The GBP 216 Million partnership deal made by Morrisons with Ocado is evaluated by the e-commerce company to help Morrisons gain the potential of becoming one of the rapidest growing online retailing firms. During 2015, it was evaluated that Morrisons.com would generate online sales revenues of around GBP 200 million where it is reflected to perform much better than any other online retailing firm or e-commerce business (Ruddick, 2015).
Morrisons also focused on generating potential price cuts for different types of products that are retailed by the company through the use of online mediums and brick-and-mortar formats. The initial price reduction initiatives undertaken by Morrisons accounted for reducing the prices of around 1,000 products by around 18 percent. The reductions in the prices for the different merchandises are accounted by Morrisons’ management in helping in installing consumer confidence (Ruddick, 2016).
Along with price reductions generated for different product assortments and categories, Morrisons’ management also focused in triggering cost savings through the reduction of different head office based job roles, revising the pension schemes and also in rendering efficiency based savings. The revamping approach undertaken by the company is evaluated by the company to help in enhancing the level of sales and revenue performance (Butler, 2016).
Similarly, the retail company also focused on introducing different takeaway food products and keeping them at the entrances of its retail outlets for helping the customers in easily picking them. Morrisons also initiated the selling of fresh and frozen food products through the use of Amazon’s online retailing platform and also through the use of the company’s website. Wholesaling of food products to Amazon contributed in helping Morrisons gain an additional profit of around GBP 5 million (Ruddick, 2016).
The development of the online sales platform contributed in enhancing the level of transaction volumes by around 3.1 percent while also contributing in reducing the level of prices for its products by around 2.6 percent. Further, the sales of its ‘Food to Go’ business is observed to grow by around 17 percent on an annual basis (Rigby, 2016).
The CEO of Morrisons focused on developing the company’s in-house manufacturing and also its processing plants for helping in offering customers fresh meat and vegetable products in a cheaper fashion. Further, the CEO also promised on recruiting and allocating large number of customers along its different outlets and also operate in a more innovate fashion based on the incorporation of different types of technological applications. The management of Morrisons also focused on understanding and evaluating the needs of its customers such that it would contribute in enhancing the level of its confidence in treating, customer serving and also in handling the emergence of consumer problems and complaints. The retail company is observed to invest around GBP 1 billion relating to price cuts over three years span for gaining over lost customers. During 2014, Morrisons’ management also focused on the development of the ‘Match and More’ loyalty scheme that contributes in the generation of price guarantee in terms of competing with discount retailers like Aldi and Lidl (Butler & Kollewe, 2015).
The management of Morrisons also focused on developing the multichannel retailing platform through not only incorporating the electronic retailing application but also in deploying tablet devices for helping managers in generating orders with suppliers. Tablets are introduced around 30 percent of Morrisons’ retail stores. Further, Morrisons also has focused on the incorporation electronic cash counting tools along the checkpoints based along its different retail outlets (Sillitoe, 2013). The incorporation of the above technological system has contributed in reducing the time taken by the customers at the store checkpoints thereby enhancing customer satisfaction. The management of Morrisons also deployed a central data platform that would help in maintaining effective records of sales, products, customers and store associated information. Apart from the development of the multichannel retailing platforms, Morrisons’ management also focused on the development of new convenience stores that would perform based on assessing the needs and expectations of customers (Sillitoe, 2013).
Morrisons is also focusing on rendering extra services to its customers like the rendering of shoe repairing services that would contribute in the generation of greater revenues based on a small amount of investment. The management of Morrisons also contributed in the development of the Fresh Look refit program for the different stores and the retail institution at large. Around 50 refits were envisaged by the company’s management during 2015 (Gladding, 2014).
Discounts rendered by Morrisons on alcoholic products with also potential revamp of the online platform contributed in enhancement of sales revenues for the retail institution. The company management remarked that the sales of Morrisons gained impetus owing to increase in visits of customers to its different retail outlets and also by the growth of basket size of customers in the aftermath of price reduction rendered by the firm. Different product assortments like the take away food products, global specialities and also the gluten free food products contributed in attracting and retaining potential customers (Butler, 2016).
Conclusions
The analysis of Morrisons operating as the fourth largest food and grocery retailer in United Kingdom reflected that the retail institution was the victim like its other competitors of the rise and growth of online and discount retailing activity in the region. The emergence of the above retail frameworks significantly affected the company’s business that led to the closure of large number of stores thereby leading to job cuts and employee resentments. Morrisons however focused on the incorporation of different retail strategies and tactics like restructuring of its retail operations with also the formation of strategic ties and also the incorporation of effective technologies like multichannel retailing and other electronic gadgets for revamping its lost image in the UK grocery market. The incorporation of effective strategies potentially contributed in enhancing its sales and helping the company develop its position in the grocery retail market of United Kingdom.
The Resit Work is carried out keeping in minds the feedback generated by tutor regarding the failure of the previous work in rightly making any sense based on its endeavour to address the assignment tasks. The resit work is ideally carried out keeping in tune with the task objectives underlined under the instructions section. Herein, the grocery retail company undertaken in the previous case, Tesco is changed to Morrisons. The original or previous work failed to effectively highlight the different changes that were introduced along the grocery retail market of United Kingdom with also its impacts on the operations of Tesco Plc. It also failed to ideally reflect on the different strategies and tactics undertaken by Tesco’s management for potentially countering the impacts rendered by the changes. The previous assignment is observed to be vaguely conducted with a broader focus on the retail market of UK.
The resit assignment focusing on the case of Morrisons, a grocery retailer based in United Kingdom reflected specifically on the different changes like the emergence and growth of online and discount retail formats that in turn affected the activity of the retail institution. It also specifically outlined the different impacts like rampant store closures, job cuts, loss of sales and decline in profits and customer bases for Morrisons on account of the different changes. The resit assignment finally reflected on the different strategies and tactics that were undertaken by Morrisons to ideally counter the threatening impacts rendered by the changes. It also highlighted on the effective outcomes of the strategies and tactics undertaken by Morrisons. The resit assignment thus contributes in rendering a holistic picture of the grocery retail market, the changes introduced thereof and also the impacts and strategies undertaken by a specific grocery retailer like Morrisons in the face of such emerging challenges.
The conducting of the resit assignment ideally helped me in clarifying the task objectives and requirements in a specific fashion. It also helped me in conducting self evaluation of the different errors conducted while writing the previous assignment and thereby in identifying a new case and specific information that would help in addressing the tasks. It also helped me in getting needed clarity regarding tutor’s expectations about the tasks underlined and thereby in gaining needed confidence in addressing the same. The conducting of the resit assignment enhanced my searching skills for addressing the tasks.
The understanding of the feedbacks rendered by the tutor regarding the conducting of the previous assignment and thereby in conducting the resit task ideally helped in earning needed clarity and confidence in handling assignments. The same would help in easily and effectively understanding the expectations and demands of the tutor from the conducting of the assignment and thereby in working accordingly for meeting such. It also helped me in conducting web based research activity in an enhanced fashion pertaining to the searching of salient information for addressing the tasks.
References
Bearne, S., 2015. Morrisons’ turnaround strategy: David Potts’ six-point plan to revive the grocer. [Online] Available at: https://www.retail-week.com/sectors/grocery/morrisons-turnaround-strategy-david-potts-six-point-plan/5078996.article [Accessed 30 March 2017].
Butler, S., 2016. Morrisons closures hit home as central Bradford store shuts. [Online] Available at: https://www.theguardian.com/business/2016/jan/15/morrisons-closes-bradford-westgate–plus-seven-stores [Accessed 30 March 2017].
Butler, S., 2016. Morrisons shares bounce after surprise sales growth. [Online] Available at: https://www.theguardian.com/business/2016/sep/15/morrisons-posts-another-quarter-of-growth-after-price-cuts [Accessed 30 March 2017].
Butler, S. & Kollewe, J., 2015. Morrisons’ losses soar to £800m. [Online] Available at: https://www.theguardian.com/business/2015/mar/12/morrisons-losses-soar-to-800m [Accessed 30 March 2017].
Gladding, N., 2014. UK food and grocery evolution 2014-2019. [Online] Available at: https://www.igd.com/our-expertise/Retail/retail-outlook/21115/The-next-five-years-How-the-UK-grocery-market-will-evolve/ [Accessed 30 March 2017].
Gladding, N., 2016. What will the UK food and grocery market look like by 2021? Will everyone be shopping online, or will the local convenience store rule? [Online] Available at: https://www.igd.com/Research/Retail/Five-year-forecast-the-grocery-market-by-2021/ [Accessed 30 March 2017].
Ough, T., 2016. Morrisons secures third consecutive quarter of growth. [Online] Available at: https://www.telegraph.co.uk/business/2016/09/15/morrisons-secures-third-consecutive-quarter-of-growth/ [Accessed 30 March 2017].
Retail Economics , 2015. Structural changes in the retail grocery sector. [Online] Available at: https://www.retaileconomics.co.uk/insights/structural-changes-in-the-retail-grocery-sector.asp [Accessed 30 March 2017].
Retail Think Tank , 2016. The future of the grocery sector in the UK. [Online] Available at: https://www.retailthinktank.co.uk/whitepaper/the-future-of-the-grocery-sector-in-the-uk/ [Accessed 30 March 2017].
Rigby, C., 2016. Online contributes to continuing Morrisons recovery. [Online] Available at: https://internetretailing.net/2016/05/morrisons/ [Accessed 30 March 2017].
Ruddick, G., 2015. How convenience stores helped destroy the supermarket. [Online] Available at: https://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11426085/How-convenience-stores-helped-to-destroy-the-supermarket.html [Accessed 30 March 2017].
Ruddick, G., 2015. Morrisons is fastest growing online business ever claims Ocado. [Online] Available at: https://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11462431/Morrisons-is-fastest-growing-online-business-ever-claims-Ocado.html [Accessed 30 March 2017].
Ruddick, G., 2015. Morrisons store closures puts 900 jobs at risk as profits slide. [Online] Available at: https://www.theguardian.com/business/2015/sep/10/morrisons-store-closures-threaten-jobs-as-profits-slide [Accessed 30 March 2017].
Ruddick, G., 2015. The market share of Tesco, Asda, Sainsbury’s and Morrisons is the lowest for a decade. [Online] Available at: https://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11522968/Five-facts-that-show-the-dramatic-changes-in-the-supermarket-industry.html [Accessed 30 March 2017].
Ruddick, G., 2016. Amazon to start selling fresh and frozen Morrisons food. [Online] Available at: https://www.theguardian.com/business/2016/feb/29/amazon-is-to-start-selling-fresh-and-frozen-morrisons-food [Accessed 30 March 2017].
Ruddick, G., 2016. Morrisons to cut prices of more than 1,000 products. [Online] Available at: https://www.theguardian.com/business/2016/aug/01/morrisons-to-cut-prices-of-over-1000-products [Accessed 30 March 2017].
Shadbolt, P., 2015. How the discounters are beating the supermarkets. [Online] Available at: https://www.bbc.com/news/business-34315643 [Accessed 30 March 2017].
Sillitoe, B., 2013. Morrisons playing retail technology catch-up. [Online] Available at: https://www.essentialretail.com/in-store-ops/article/5232d3709607d-morrisons-playing-retail-technology-catch-up [Accessed 30 March 2017].
Sillitoe, B., 2016. What are the big four grocers doing in eCommerce? [Online] Available at: https://www.essentialretail.com/analysis/article/5800a317dab3d-what-are-the-big-four-grocers-doing-in-ecommerce [Accessed 30 March 2017].
Stevens, B., 2016. Morrisons reports third consecutive quarter of growth. [Online] Available at: https://www.retailgazette.co.uk/blog/2016/09/morrisons-reports-third-consecutive-quarter-of-growth [Accessed 30 March 2017].
The Guardian , 2016. Morrisons cuts cost of basics as supermarket price war continues. [Online] Available at: https://www.theguardian.com/business/2016/feb/01/morrisons-cuts-cost-supermarket-price-war [Accessed 30 March 2017].
Tugby, L., 2016. Analysis: Morrisons’ extended deal with Ocado – the pros and cons. [Online] Available at: https://www.retail-week.com/sectors/grocery/analysis-morrisons-extended-deal-with-ocado-the-pros-and-cons/7010043.article [Accessed 30 March 2017].
Wm Morrison Supermarkets plc , 2017. Company History. [Online] Available at: https://www.morrisons-corporate.com/About-us/company-history/ [Accessed 30 March 2017].
Essay Writing Service Features
Our Experience
No matter how complex your assignment is, we can find the right professional for your specific task. Contact Essay is an essay writing company that hires only the smartest minds to help you with your projects. Our expertise allows us to provide students with high-quality academic writing, editing & proofreading services.
Free Features
Free revision policy
$10Free bibliography & reference
$8Free title page
$8Free formatting
$8How Our Essay Writing Service Works
First, you will need to complete an order form. It's not difficult but, in case there is anything you find not to be clear, you may always call us so that we can guide you through it. On the order form, you will need to include some basic information concerning your order: subject, topic, number of pages, etc. We also encourage our clients to upload any relevant information or sources that will help.
Complete the order form
Once we have all the information and instructions that we need, we select the most suitable writer for your assignment. While everything seems to be clear, the writer, who has complete knowledge of the subject, may need clarification from you. It is at that point that you would receive a call or email from us.
Writer’s assignment
As soon as the writer has finished, it will be delivered both to the website and to your email address so that you will not miss it. If your deadline is close at hand, we will place a call to you to make sure that you receive the paper on time.
Completing the order and download