The theory came into existence in the year 199 and enacted by Barney that aims at the acquisition of the required resources- natural resources at cheap rates and then convert them into useful resources. Additionally, the implementation of the strategies is vital for growth and establishing a business in a competitive environment (Alexander, 2018). In context with the supermarket industry, the strategies such as pricing strategy and product differentiation strategies are used by leading supermarkets based in Australia for instance- Woolworth and the Coles supermarket for gaining the market share and purchasing of required resources at bulk quantity are done by supermarkets from Western Australia providing them with resources needed. Hence, it can be said that the resource-based theory emphasizes that acquisition and utilization of required resources are a must for gaining a competitive advantage from the existing rivals. Moreover, the purchased resources must be sold at a high price which can be more than its actual pricing for generating high- profitability in the competitive market.
The strength of supermarkets lies in profits generated by the cost leadership strategy and increased demands of fresh and organic products to its target customers at low rates hence, it assists in attracting and retaining its consumers in long run. Moreover, the consumption of daily products such as- bread, milk is easily available by the supermarket industry at affordable rates that strengthen its presence and profits in the Australian market (HU, & XIANG, 2019).
The Government tight policy for the Coles group and Woolworth supermarket in regards to non-flexible working and dealing hours restricts the growth of the supermarket industry. Moreover, problems arising from west Australia suppliers and the management weakens the industry.
Supermarket industry can follow the trend and preferences by its consumers such as – organic products, gluten-free products that assist in attracting its customers and gaining a competitive edge in the market.
The government interventions in Australia regarding fixed dealing and working hours and price-wars between the rival's presents as a major threat in the supermarket industry both online and offline.
IDENTIFICATION OF MAJOR ISSUES
The governmental intervention-
In context with Western Australia which is a major source supplier for the supermarket industries. Hence, the rules and regulations as per the Government of Australia regarding labor rights and rigid working hours act as a major obstacle for the supermarket industries based in Australia such as the Coles and worth wool. Hence, as a result, the grocery market generates embezzle profits. On the other side, abiding by the Australian Governmental new set of policies and regulations becomes a challenging task for the supermarket industry hence, the major issue of governmental intervention identified (Porter, 2019).
The positive economic conditions give lucrative opportunities for the industries to establish and expand their own business at large. Similarly, in regards to the supermarket industry based in Australia, there exist cut-throat competitions between the competitors including the - Coles group, IGA, the Woolworth supermarket, Aldi and the Wesfarmers. Therefore, all of them use competitive strategies for capturing the market share and competitive advantage for instance- cost leadership strategies and the product differentiation strategy (HU, & XIANG, 2019).On the other hand, there exist tough price wars between the Coles and Woolworths for capturing the market share and attracting the target customers in the long run. Therefore, it can be said that the neck to neck competition is a key issue that can hinder the growth of the supermarket industry (Woolworths Company, 2019).
The availability of the products and services at cheap rates allows in attracting and retaining the target customers for a long run but, this can be a key issue as the profits margin will be lower and to survive in the competitive market the, the price has to be even more lowered, therefore, the cost leadership strategy might result as a failure for the supermarket industry pertaining in the competitive environment (HU, & XIANG, 2019). On the other hand, the offers and discounts provided to the end-customers help in attracting them but again accumulates low profits. Hence, it can be said that the lucrative opportunities are relatively lower because of the low cost of the daily use products being available at the supermarkets and the groceries.
THE STRATEGIC CHANGE-
The technological strategically change-
In context with the supermarket industry particularly the Coles group, it should adapt to the new technological changes to improve its productivity and survive in the competitive market. On the other hand, The IS system named the information system can be developed by the Coles Group to improve the business operations and gaining a competitive advantage from its competitors namely Wool worth, IGA, and the Wesfarmers. Moreover, the DSS system namely the decision support systems can be developed by the firm to enhance the decision making. Hence, technological barriers can be removed further by the adoption of the above systems (Davis, 2013). The strategic planning will be helpful to meet the strategic goals of the business and also helps in accomplish the set goals and objectives. Nonetheless, the advancement in the technology would be useful to strengthen the business and developing the business core competency.
Employee’s capabilities to change-
While implementing the planned strategies the Coles group's major disadvantage could be the lack of skilled workforce hence, the smooth operations cannot be performed. Moreover, Cole's group needs to adopt the latest technologies but that requires training which will be a costly affair in terms of time, money and efforts. Therefore, training and lack of required workforce for adopting the latest technology will increase the cost of operations and the labor cost (Competitor analysis, 2019). Additionally, adoption of the latest technologies is a bit difficult task and if the employees cannot handle the complex systems then, it will be indicated as a red flag for the organization thereby, hiring experts and fresh talents for operating the technical system is need of the hour (Beauchamp, Bowie, & Arnold, 2014). Hence, it can be observed as a major key issue while implementing the business strategies in the organization.
Adoption of the latest technologies, for instance, the DSS and IS systems is strongly recommended for the supermarket industry especially the Coles group for ensuring smooth business operations and enhanced decision making in the organization. However, lucrative opportunities are relatively lower because of the low cost of the daily use products being available at the supermarkets and the groceries which is one of the main attractive point to grab more clients. On the other hand, there exists cut-throat competition in the supermarket industries based in Australia hence, the cost leadership strategy is not enough to survive and compete in the existing market hence, it could be recommended that the industries need to implement policies and robust business strategies along with practices of good corporate governance for meeting the long term targets of the organization. There exist tough price wars between the Coles and Woolworths for capturing the market share and attracting the target customers in the long run which could be more developed through the rapid development in the technology. Additionally, updates technology will assist the firm in improving productivity, gaining the lucrative opportunities and competitive edge in the market hence, strongly recommended. Online convenience is the best way for reaching the target customers hence, the implementation and active engagement through posts is highly recommended for reaching customers and spreading awareness regarding the respective products and services. The updating in the technology and system process would be the best option to accomplish the set goals and objectives. The strategic planning undertaken would help to meet the strategic goals of the business and also helps in accomplish the set goals and objectives. Nonetheless, the advancement in the technology would be useful to strengthen the business and developing the business core competency. It is advised that the core competency in the particular field by the company helps in mitigating the business issues and problem in determined approach.
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