This strategic information system demonstrates the company’s background and retail industry. It also describes the several factors such as political, socio-cultural, technological, and global and demographics. It also assesses Porter’s five force models to assess the condition of industry such as the bargaining power of buyer and suppliers, threats of substitutes and new entrants and rivalry among competitors. It also discusses the tangible and intangible resources, capabilities and competencies of Woolworths.
Business background
Woolworths is the largest supermarket chain in the nation of Australia. It has recruited over 115,000 staff members in their distribution centers, stores, and support offices for offering the finest services, wider range, convenience and value to their customers. It also prides itself on working nearly with Australian farmers and products and makes sure that a superior product is available for the customers (Hill, 2017). This company sources 96% of all fresh vegetables with fruits and 100% of fresh meat from Australian producers and farmers. It makes fresh food people to Woolworths Australia. Woolworths is one of the most innovative retailers in Australia because it comprehends that consumers have required a simple way to buy and new products. Woolworths provide an opportunityforthe customer to buy as per their convenience such as using a computer at home, and also customer can use Woolworths Supermarket Appon the train and on their way to shop. It also provides the opportunity to deliver the groceries straight to the bench of the kitchen (Hitt, and Duane Ireland, 2017).
The industry of retail continues to grow, expand and enlarge the market and also contributes to socio and economic development. The key element of improving the industry of retail is a high expansion of economic, gaining population and buying power of customers. Australian retail industry is very flexible in terms of launching the products and services. Moreover, the sudden fall down and go up in the retail industry isgenerally in Australia. During the previous period, the low-interest rate has offered assistance to retail sectors. Moreover, the buying power of the customer has increased that has ultimately impact on the retail industry (Ginter, et al., 2018).
Political
The political condition has affected the retail sector of Australia and also created an impact on the productivity of Woolworths limited at the maximum level. For example, the federal government in Australia has presently identified the competitive approach toavoid the key rivalrysuch as Wesfarmers and Coles. The increasing power of the market among these retailers has demonstrated thata small retailer is struggling with sustaining in the retail industry (Meyer, Neck, and Meeks, 2017).
Economic:
In Australia, economic marketing situation is declined across Australia. It may have an impact on the organizational performance because of diminishing economic practices in the region of Australia. Apart from this, variation in the exchange rate of currency and weakening Australian dollar has negatively affected the global retail operation of Woolworths (Lasserre, 2017).
Socio-culture:
The social factor has also affected the Australian retail industry because of an alteration in the attitude and lifestyle of people. In addition, altering societal issue has created the need for transformation in Woolworths. Under Australia, people are highly concerned with respect to obesity and health in the current time period. Hence, there is the demandfor low-fat food, simple to cook food along with organic food. The participation of women in Human resource has gained in existing time. Therefore, Woolworths can influence their existing and potential customers by involving these aspects (Bettis, et al., 2016).
Technological:
In Australia, Woolworths can focus on implementing the new and updated technology as; it would lead to improving the supply chain with the allocation system. This tool could be also effective with the intention of saving the expenses. It may also increase the range of facilities and can highly use the online channels in order to deal with the customers. However, Woolworths should customize its website to obtain the competitive advantageous (Engert, et al., 2016).
Global segment
Woolworths has enlarged their operation of the business in the nation of India and New Zealand for keeping its growth in the industry of retail and may take benefits from its strength in the market.
Demographic factor
In Australia, there is a mix of the ethnic and religious group due to its policy associated with immigration. The inhabitants of Australia is 24,806, 930 in the year of 2018. In addition, a person who is more than 65 years contributes about 12% of the population and also projected about 25% of growth in 2015 in the nation of Australia. A person whose age more than 85 years will only contribute approximately 5% in the year of 2051.
Physical factor
The physical factor may persuade the productivity of Woolworths and also affected the retail industry in across Australia. For example, Woolworth’s petrol with winemaking companies is generating the hostile risk for the environmental condition and this may persuade the performance of Woolworths limited in the operational field (McKiernan, 2017).
Bargaining Power of Buyers:
The retail sector provides the homogenous goods and services in Australia so that; the bargaining power of the buyer is higher due to low switching expenses. In addition to this, the bargaining power of the buyer is low with those retail stores that may personalize the offering according to the specific market area.
Bargaining Power of Suppliers:
In the Australian retail industry, the bargaining power of supplier is varied because; it relies on the brand names of suppliers along with the size of the retail sector. Thus, the bargaining power of suppliers in the Australian retail sector could be high to moderate (Peng, 2017).
Threats of New Entry:
Retail sector provides the low rates hence it is not a lucrative industry to penetrate because of low prospective profit. The restriction and regulation of government, a huge amount of capital, availability of resources, and the maximum market rate of land can perform as a barrier to entry. It shows that obstacles to penetrate in the retail sector are moderate (Barney, 2017).
Rivalry among Existing Firms:
The threat of competition is assessed within the retail sector of Australia. There is high competition among current companies because there are some key competitors like Asda, Woolworths, Wesfarmers,and Coles, which are beating to each other in terms of market share.
The threat of Substitute:
There are a high amount of substitutes available for customers such as convenience store, online stores, fresh food market, non-affiliated petrol pump, pharmacies and delicatessens in the Australian retail industry. There are certain consumers who are keen to compensate to premium rate for conveniences like closer to home, no stand in line and informal parking. Therefore, the availability of substitutes is moderate to high in the Australian retail industry (Aguinis, et al., 2017).
Woolworths should emphasize on strategic groups such as Wesfarmers, Coles supermarket and Asda because it has captured the higher retail market of Australia. The high rivalry in this group is related to producing quality products in affordable price. The capabilities of these companies are a high amount of stores, online channels, fresh and quality food, and higher human resource. It also follows the effective approaches like improvesthe value leadership; deliver a healthier store network, emphasize on cleanness, and increases well store network. The key challenge from these strategic groups could be related to shifting customers with respect to brand, diversification, and reducing revenue (Rosenberg Hansen and Ferlie, 2016).
Opportunities expanding online retailing
Over the earlier periods, the viewpoint of Australian retailing industry has been restructured considerably because of the availability of computerization, the expansion of technology transformation in consumer’s lifestyle and supply chain. It is also evaluated that the retail industry is imminent in a diverse way that is imminent in the differentmethod by digital commerce and internet development. Moreover, it is evaluated that Woolworth’s give their best to their
Woolworth’s business put at the heart of consumer since last periods.The organizationcould use online shopping to increase their profit in limited time and cost. Moreover,once the consumer is satisfied with the products and services of the organization then organization try to encourage the mobile shopping.It could be effective for attracting a huge amount of consumers in limited time and cost (Nickols, 2016).
On the basis of United Nations Food Corporation, it is analyzed that the global population is increased to reachat 9.1 billion in 2050 that demonstrates that food production would be enhanced in future. Thus, it is analyzed that food organization invests in the farming products and services for the obtainment of higher profit at least time and cost. But, the outcome of enhancing crop yield is a polluted atmosphere and modification in climate has toan impact on the attainment. In addition, it is also evaluated thatWoolworths fresh food provides an opportunity to gain the productivity and sustainability of the organization in the long-term (Gallus and Frey, 2016).
Woolworthsis facing competition from their key retailer in Australia. Woolworths concentrate on lower price approach as Coles and their major competitor’s practice price rewind approach in the retailing industry of Australia. Woolworths will face certain issues at the time of dealing at the international level.In addition, it is also evaluated that the government policy of Woolworths could face a problem due to the flexibility of government policy. The flexibility in government policy could increase the penetration level of organization. Consequently, it could increase the possibilities of getting a failure (David and David, 2017).
The internet environment evaluation is imperative to identifythe strength and weakness of the organization. The firm could practice internal evaluation to relocate in the market for new offering goods and services in their upcoming vulnerability.
Woolworths deals in more than 3000 stores across Australia and New Zealand and it has employed about 180,000 employees. It demonstrates that their tangible and intangible resources are robust. It has an adequate amount of human resources products and services, strong brand image, and best services provider. It has also a strong liaison that supports to make a reliable decision with respect to the current matter.
Capabilities could determine as skills of the organization in organizing their resources and implementing them for productive usage. In addition, it is also addressed that Woolworths is effective in operating their business since 1924 that demonstrates that it is capable to imply the right person inthe right place. Moreover, Woolworths has the best knowledge towards the utilization and development of goods and services that lead to getting higher success (Peppard and Ward, 2016).
It is evaluated that the innovation and advantages of Woolworths have a direct impact on the supply chain. Woolworths is relied on their cost-cutting approach and efficiency with respect to control the unnecessary costs.
Branding and Market
Woolworths has used “the fresh food people” slogan for making a different image of the organization among consumers. It could attract consumers to give preference to products and services by offering quality goods and services. This organization also offers healthy goods and services at the reasonable cost (Scarborough, 2016).
Innovation
Woolworths has used different products and services like “refresh” the new idea initiative like petrol retailing.
Integration
Woolworths has entailed some of their supplies by producing their own inputs to increase their market by manufacturing their own inputs to increase their market power and react aboutprivate level tendencies.
The ERP (enterprise resource planning) could be imperative in the information structure solution as it requires an appropriate solution as it will attain the needs of the firm. This structure is the automation procedure that considers many factors such as suppliers, price, and buyers. It also offers the core business procedure of Woolworths and tracts the business resources like cash, production capacity, and payroll, raw material, and purchase orders. It would be imperative for effectively share the information across entire business purposes and executive’s links with outside shareholders (Scarborough, 2016).Messaging is another internet communication structure that could be practiced by Woolworth to attain their needs. This structure will facilitate the executives and their employees to directly converse with each other. It is also effective for eliminating the noise issues at the organization and increases the relationship with their team members.
Evaluate the proposed system and provide your recommendations
Woolworths should imply ERP structure for their business procedure as it will facilitate a company to operate the business process by considering human resources and modern technology. It will support in the product planning, marketing, sales, and manufacturing by single database and application. Moreover,the organization should also identify needsand expenses and manage the payrolls and get reliable outcome (Peppard and Ward, 2016).
Conclusion
With respect to the above interpretation, it can be summarized that there are certain components that could affect the Woolworths business like economical, technological, demographical, physical, socio-culture, global, and political. It can also be concluded that there are many industrial components as it creates difficulties to obtain competitive benefits named bargaining power of suppliers and buyers, the threat of new entreats and substitute, and rivalry among existing competitors. It can besummarized that the organization has certain tangible and intangible sources like brand image, human resources, and suppliers relationship as it assists to build the abilities and core competency of the organization.
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