Discuss about the Strategic Management for Countdown Plans Five New Stores.
The report focuses on evaluating the strategic planning of Countdown Supermarkets based in New Zealand. It would focus on generating an overview of the company and the retail industry of New Zealand along with conducting of effective analysis based on the use of strategic tools like PESTEL and SWOT. Effective recommendations and strategies would be generated for enhancing the business potential of the retail institution in the future period.
Countdown operates as the market leader in the supermarket category in New Zealand that serves the needs of around 2.5 million customers on a weekly basis. Countdown focuses on providing wide assortment of value based products in a personalised fashion where customers can avail the same in a convenient manner. Countdown operates through a wide network of 183 different supermarkets that are run by a group of 18,000 people. The company focuses on encouraging customers select between 20,000 different products to satiate their diversified needs. Countdown operates based on a large number of distribution centres that contribute in reaching fresh vegetables, meat products and other merchandises to a larger number of consumers (Countdown, 2016).
The retail industry is observed as the largest industry that operates in the New Zealand region. The retail industry of New Zealand during 2014 is observed to employ around 186,000 different full-time equivalent employees operating across varied kinds of stores both along organised and unorganised retail. The retail industry during 2014 generated total revenue of $12.7 billion that accounted for 5.5 percent of the nation’s GDP. New Zealand’s retail sector is observed to counter potential challenges based on development of an online platform by organised retail companies and potential emergence of low cost competitor firms that focus on squeezing the revenue and profit margins on a holistic scale (Westpac, 2015).
The vision statement of Countdown is to sustain its market leadership in the retail sector of New Zealand. It aims in developing the retail environment for generating needed customer satisfaction through the rendering of effective product and service offerings and also through helping customers gain access to customised and branded product offerings in a convenient fashion. Countdown also aims in continually enhancing its market share in the New Zealand retail market.
Countdown focuses on conducting its retail operations through rendering increased significance in understanding the needs of its retail customer base. It focuses on taking business decisions based on anticipation of consumer needs and expectations. The management of Countdown potentially encourages the growth of teamwork and also focuses on developing and building the retail brand to compete with other food, grocery and other retailers on both a regional and global scale. Further, the management of Countdown also encourages its staffs to work in a safe manner in the retail workplace to safeguard themselves from emergence of occupational hazards. The management of Countdown also focuses on development of the society and community as a whole through generation of both financial and non-financial support (Westpac, 2015).
The statement of values for Countdown is enumerated as follows.
The staffs and management of Countdown focus on operating as a potential team that focuses on exploiting potential opportunities and also in countering needed threats. Further, the internal organisational culture of Countdown focuses on showing respect for the different stakeholders like customers, vendors, supplier groups and also the internal people operating across different departments and levels. Further, the management of Countdown also focuses on developing the needed expertise and potential of the internal staffs such that they can help in generation of greater productivity and business efficiency. Similarly, the organisation also works in generating process and operational innovation such that the same helps in enhancing the operational and business environment of the business institution. The management of the retail institution also focuses on enhancing on the parameter of accountability in that the same encourages in conducting the actions in a deontological fashion for generating needed results. Finally, Countdown also aims in encouraging customers avail the best type of shopping experience that helps in exceeding their expectations and anticipations.
Countdown’s statement of values can be further enhanced based on incorporation of tools that would help in understanding the feedbacks and views of customers, staffs and other stakeholder groups within specific periods. The gaining of needed feedback would help the company management in personalising and customising the product and service offerings thereby enabling greater sales and customer satisfaction.
The strategic objectives of Countdown are effectively identified as follows.
The retail organisation focuses on extending its market share and retail leadership in product sectors like food and liquor. Further, the retail institution also focuses on enhancing its product and business portfolio for potentially increasing the existing value of stocks and shares for generating increased returns to the shareholders. The management of Countdown also focuses on sustaining an effective track record for developing and innovating on the business front. Countdown also focuses for incorporating needed enablers to encourage the development of needed growth along its food and non-food retail segment (Woolworths Limited, 2012).
The strategic objectives of Countdown Supermarket earn applicability in that it encourages the retail institution for diversifying its product portfolio which in turn would help the company for penetrating the consumer market. Increased penetration of the consumer market in turn would help in generation of needed revenues thereby contributing to increased returns to shareholders. Further, use of online and mobile technology would also help Countdown Supermarket in evaluating consumer perceptions regarding its product development and diversification initiatives.
Analysis of the Internal Environment
Strengths
Countdown Supermarket reflects essential strengths based on its operation carried out through a large number of outlets, distribution centres and also through its supply chain units. The company also encourages the incorporation and growth of needed innovation based on the development of the online foodbank in Auckland and also of the iPhone application for generating needed convenience to customers. Further, Countdown focuses on conducting its retail operations in a customised fashion through the generation of customised product offerings and loyalty cards. The supermarket also focuses on sustaining the natural environment through reducing its impacts on the nature (Countdown, 2016).
Weakness
The operation of Countdown Supermarkets faced potential challenges related to the failure of operation of the EFTPOS machines that made the customers face problems in the checking counters and also regarding the billing of the merchandises. The unsatisfied customers also complained of the problem associated with the EFTPOS machines on social media networks both through written posts and videos that required the company for generation of new machines in the stores (Supermarket News, 2015).
Opportunity
Countdown is observed to gain needed impetus for expanding and diversifying its base in New Zealand based on generation of new divisions like insurance and pharmacy. The generation of new type of product offerings by Countdown helps the supermarket in both attracting and retaining potential customers (NZHerald , 2014).
Threat
Supermarkets like Countdown operating in New Zealand are observed to suffer from increasing threats regarding the poisoning of infant milk and food products. The poisoning of the baby food and milk products is taken to affect the sales of the same and thereby requires the retail institutions to focus on enhancing the security aspects of the stores and also the use of CCTV surveillance in an effective fashion (HUME, 2015).
PESTEL Analysis of Countdown
The Commerce Commission of New Zealand has alleged Countdown for its anti-competitive behaviour against Kiwi suppliers. The commerce authority in the region has identified the retail institution for largely blackmailing and extorting Kiwi suppliers. Countdown’s relationship with its suppliers is alleged on two grounds firstly for lack of effective communication and also in discussing sensitive supplier related information with its competitor firms (MCNICOL, 2014).
Economic Impacts
Countdown, the leading supermarket company based in New Zealand has expanded its network in the region based on opening increased outlets along different regions of the economy. The retail institution focused on expanding its base to semi-rural areas of New Zealand through the opening of around five new supermarkets during 2014. The expansion strategy of Countdown counters effectiveness in that the same helps in countering the merger and acquisition activity of other competitor firms (Adams, 2013).
Social Impacts
A survey conducted on the retail consumers visiting the Countdown supermarkets of New Zealand reflect that the consumers expect changes regarding customisation and value enhancement of owned branded products. The consumers also stated that they require refreshed and new designs for the different own branded products. The new designs are required to be generated for the own branded products in that the same would help the customers for easily selecting and choosing the same from a wide assortment of other branded products (The Register , 2016).
Technological Impacts
Countdown has launched a new online shopping application especially meant for iPhones that would help the customers in viewing and comparing prices of products and also helps them in conveniently marketing for meeting their needs and expectations. The digital shopping application generated by the retail supermarket helps in easy scanning of bar codes and also in storing information in QR Codes to be scanned through the use of QR Scanners. The technological advance contributes in helping customers gain first hand information regarding product prices and promotions and also of their bonus points and loyalty card information (Progressive Enterprises Limited, 2016).
Environmental Impacts
The management of Countdown effectively focuses on reducing the impacts of the retail operations on the natural environment of New Zealand through the incorporation of energy efficient lighting, cooling, and refrigeration systems and also through aiming in the reduction of carbon emissions. Increasing environmental consciousness reflected by Countdown has helped the company in fetching the Green Ribbon Award from the New Zealand government during 2016 (Countdown , 2016).
Legal Impacts
The New Zealand based supermarket, Countdown faces ethical charges regarding the use of colony cages for storing of poultry live stocks. It is argued on ethical grounds by the New Zealand government that live stocks are better kept in battery cages than in colony cages and further it also requires the management of the retail institution to carry out regular inspection regarding the periodic inspection of live stocks kept in cages and also the removal of dead birds. The government has further required the retail institution for adopting the best practices standards regarding the storing of live stocks failing which the retail companies would be required to face prosecution charges (NZHerald, 2016).
The business strategy that can be effectively incorporated by Countdown Supermarket in New Zealand is essentially two faceted in nature where the organisation can focus on the development and incorporation of the multichannel marketing and retailing network and also on the use of the agile supply chain strategy. The management of Countdown can effectively focus on the employment of the multichannel marketing strategy based on the incorporation of different types of retailing channels like existing brick-and-mortar outlets, mobile and online commerce platforms through the development of applications for Smartphones and also through the use of electronic and mobile commerce and other social media network sales platforms. Further, Countdown can also focus on the development of retail kiosks for reaching its own branded products to a larger number of customers (Dahmen, 2012).
The employment of the agile supply chain system needs to be encouraged for Countdown through the use of Radio Frequency Identification (RFID) tags and bar codes and also through the use of Point-of-Sales (POS) scanners. Use of effective ERP Systems along with the above technologies would help Countdown in effectively tracking the movement of stocks and retail merchandises along the different units like supplier stations, distribution centres and finally to and from the stores. It would help the company make supply and demand forecasting and also in inventory management activities (Min, 2015).
The multichannel retail strategy can be effectively implemented by Countdown Supermarket based on development of effective synergies between the different retail fronts like brick-and-mortar, website and social media marketing, electronic and mobile commerce. Different contents are required to be planned and developed for marketing products through the use of company websites, social media network platforms like Facebook and Twitter and also through the use of electronic and mobile commerce media. The development of contents depending on the retailing media helps in attracting and retaining greater number of consumers visiting such sites or networks. Further, effective software and applications are required to be developed that essentially suit the mobile and electronic platforms. Development of effective applications would enable the customer for viewing and comparing different product assortments and also for procuring the same in a convenient fashion (Dahmen, 2012).
The implementation of the agile supply chain strategy requires the management of Countdown Supermarket for incorporation of different technological systems like an effective ERP Software, RFID Bar Codes and Tags and also POS machines. The integration of the above systems would help Countdown for tracking the movement of merchandises along the different business units (Min, 2015).
The evaluation of the success or failure of the multichannel retailing and agile supply chain strategies can be carried out through the conducting of effective interviews and surveys. Conducting of focused group interviews of the retail managers along with conducting of surveys of the customers and the sales and customer servicing staffs would help in understanding the effectiveness of the strategies in enhancing business revenues, market share, customer satisfaction and also in understanding the consumer perceptions regarding new product development and diversification initiatives of the company.
Conclusions
The strategic analysis of Countdown Supermarket reflects that the retail institution based in New Zealand has needed potential for developing its presence in the retail market of the region. The existence of effective retail and distribution outlets help the company in adequately meeting the needs of its customers. Further, the innovation and product development and diversification potential of the company is taken to help Countdown in strategising its product and service offerings to enhance customer satisfaction. The report also reflects on two strategic undertakings like development of the agile supply chain and multichannel retailing paradigms for enhancing the existing business potential of Countdown.
References
Adams, C., 2013. Countdown plans five new stores. [Online] Available at: https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11118947 [Accessed 22 July 2016].
Countdown , 2016. Environmental sustainability. [Online] Available at: https://www.countdown.co.nz/community-environment/environmental-sustainability [Accessed 24 July 2016].
Countdown, 2016. Our Company. [Online] Available at: https://www.countdown.co.nz/about-us/our-company [Accessed 21 July 2016].
Countdown, 2016. Our History. [Online] Available at: https://www.countdown.co.nz/about-us/our-history [Accessed 25 July 2016].
Dahmen, P., 2012. Multi-Channel Strategies for Retail Financial Services: A Management-Framework for Designing and Implementing Multi-Channel Strategies. United Kingdom: Springer Science & Business Media.
HUME, M., 2015. Milk poison threat affects supermarket security. [Online] Available at: https://www.stuff.co.nz/national/67256828/milk-poison-threat-affects-supermarket-security [Accessed 25 July 2016].
MCNICOL, H., 2014. Countdown cleared of anti-competitive behaviour. [Online] Available at: https://www.stuff.co.nz/business/industries/63369023/Countdown-cleared-of-anti-competitive-behaviour [Accessed 22 July 2016].
Min, H., 2015. The Essentials of Supply Chain Management: New Business Concepts and Applications. United States : FT Press.
NZHerald , 2014. Countdown adds insurance services to supermarket offering. [Online] Available at: https://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=11352267 [Accessed 7 July 2016].
NZHerald, 2016. Countdown pulls eggs after shocking footage of dead hens. [Online] Available at: https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11618114 [Accessed 25 July 2016].
Progressive Enterprises Limited, 2016. COUNTDOWN LAUNCHES SUPERMARKET SHOPPING APP. [Online] Available at: https://www.progressive.co.nz/our-company/news–media-releases/countdown-launches-supermarket-shopping-app [Accessed 24 July 2016].
Supermarket News, 2015. EFTPOS PROBLEMS FOR COUNTDOWN. [Online] Available at: https://supermarketnews.co.nz/eftpos-problems-for-countdown/ [Accessed 25 July 2016].
The Register , 2016. Countdown undergoes major revamp of in-house products. [Online] Available at: https://theregister.co.nz/news/2016/04/countdown-undergoes-major-revamp-house-products?page=103 [Accessed 24 July 2016].
Westpac, 2015. Industry Insights. New Zealand : Westpac.
Woolworths Limited, 2012. Countdown serves more than 2.5 million customers every week.. [Online] Available at: https://www.woolworthslimited.com.au/page/Who_We_Are/Our_Brands/Supermarkets/Countdown/ [Accessed 22 July 2016].
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