STRATEGIC MANAGEMENT

GROUP ROYALS
LECTURER : MR. HECTAR JOHN DELA VICTORIA
 GROUP ROYALS
DEBRAJ SEDAI 39836
NASEERUDDIN MOHAMMED 39844
ANOSH ASHIK THAI KANDY 39273
AMAL THARANGA 39795
SAFRAZ AHMAD 39989
CHRISTIAN CHIGIZIE OHALE 39758
 : INTRODUCTION

 Waitrose is one of the leading supermarket chain of

UK with 219 supermarkets and 4 convenience stores.
 Waitrose is in partnership with The John Lewis, one
of the UK’s top ten retail businesses with 28 John
Lewis full line department stores.
 It is also the country’s largest employee co-operative,
with 72,000 employees. The Partnership aims to
ensure that everyone who works for it enjoys the
experience of ownership, by sharing in the profits, by
having access to information and by sharing in decision
making.
 : HISTORY

  Wallace Waite, Arthur Rose and David Taylor

opened their first small grocery shop at 263 Acton
Hill, West London in 1904.
 The John Lewis Partnership acquired the Waitrose
in 1937, opening the first Waitrose supermarket in
1955. 
 : MISSION
 Waitrose have very simple objectives; it is an action plan for
organic farming that aims to ensure 30% of agricultural
land in England and Wales and 20% of the food we eat is
organic by 2010. It will also make a commitment to deliver
organic food that is more affordable to everyone.
 Waitrose aims to combine the convenience of a
supermarket with the expertise and service of a specialist
shop. We also offer you a Price Commitment to ensure you
always get good value for money when shopping at
Waitrose
 : VISION

  Waitrose vision is to be a successful business

powered by its people working for it and its
principles defines unique company today. The profits
and benefits created by Waitrose success are shared
by all the Partners.
 : : BUSINESS MODEL

BUSINESS MODEL:
Aim is to employ PARTNERS
the eligible
workers who can
work as a
partners

Distribute
a share of
PROFIT CUSTOMERS
profit to all Provide
partners customers
with best
possible
shopping
experience
 : EXTERNAL
ENVIRONMENT

 PESTEL ANALYSIS
 POLITICAL
 ECONOMICAL
 SOCIOCULTURE
 TECHNOLOGICAL
 ECOLOGICAL
 LEGAL
 : : PESTEL

 POLITICAL :- The fallout from the financial crisis has led to

significant changes in government policy.
 Banks has reduced interest rates to their lowest point in 57
years. vat has been gone down to 15% for a period of time.
 In 2007 John Lewis and Her Majesty’s Revenue and
Customs agreed a scheme to allow partners to receive their
bonus tax free.
 ECONOMIC: Waitrose has responded to the recession by
investing £30 million in price cuts, and the heavy
promotion of its “As good as going out” range, in the hope
that customers will substitute eating in with going out.
 : PESTEL

 SOCIOCULTURAL : Waitrose’s customer age profile is skewed towards the

45-64 group In the long term, therefore, Waitrose could be expected to
benefit from the UK’s aging population.
 With increasing awareness of sustainability issues, recent years have seen
significant growth in the organic and fair trade foods. Although Waitrose
only has an overall market share of 3.9%, its share in the organic market
stands at 18% and fair trade 8.6%.

 TECHNOLOGY : The key technological concern to supermarkets is the

continued growth of internet shopping, its growth is ten times higher than
the traditional market. Including sales through Ocado, Waitrose currently
holds 20% of the online grocery market share. The recently extended five
year contract between Waitrose and Ocado is geared to allow Ocado to
concentrate its efforts within the M25, where it is the market leader, and to
allow Waitrose Deliver to concentrate on other areas.
 : PESTEL

 ENVIRONMENT : The Government has set clear targets for the

reduction of CO2 emissions, and these will have a significant impact on
the supermarket industry.
The Partnership has a number of policies aimed at ensuring
environmental sustainability, in particular it is leading the industry in
the implementation of “green IT” and has developed a framework for the
sustainable construction of its new stores in association with “Forum for
the Future” to ensure that its new stores meet the BREAAM “excellent”
status. The Partnership has won numerous awards for its approach.
LEGAL : The Competition Commission recommended the
implementation of a new planning policy which will favour new entrants
to the local market. As a smaller operator in the grocery market this
legislation could provides new opportunities for growth for Waitrose as
new sites become available.
 PORTERS FIVE FORCES

 COMPETETIVE RIVALRY: The UK supermarket sector is

fiercely competitive, led by the “big four” Tesco, Asda,
Sainsbury’s and Morrison‘s. Waitrose is seen as operating at the
premium end of the supermarket with Marks and Spencer.
Waitrose has recently indicated that it will target the convenience
store market, following successes by Tesco, Sainsbury’s and
Marks and Spencer.
 BARRIERS TO ENTRY: The UK Supermarket sector is well
developed, and has a small number of successful companies who
account for the vast majority. significant investment required to
set up and market a supermarket, along with the significant
economies of scale and aggressive tactics employed by the
existing companies, the barriers to entry are very high.
 PORTERS FIVE FORCES

 THRERS OF SUBSTITUTES: The key substitution effect in the industry is the

move from shopping in stores to shopping online With the exception of Ocado, all
of the major online supermarkets are operated by bricks and mortar
supermarkets. It is questionable whether Ocado could have succeeded without
the support of Waitrose, but as Ocado grows it becomes more feasible that it
could eventually become independent. This may explain the continued growth of
Waitrose Deliver in tandem with Ocado. The key substitution effect in the
industry is the move from shopping in stores to shopping online. With the
exception of Ocado, all of the major online supermarkets are operated by bricks
and mortar supermarkets. It is questionable whether Ocado could have
succeeded without the support of Waitrose, but as Ocado grows it becomes more
feasible that it could eventually become independent. This may explain the
continued growth of Waitrose Deliver in tandem with Ocado.

 BUYER POWER: is particularly high in the supermarket industry, largely

because the market is very competitive and people are increasingly mobile.
 PORTERS FIVE FORCES

 SUPPLER POWER: Supplier power is low, because

of limited differentiation, particularly in dry goods,
where products can be almost generic. This has led
to loss leader marketing of essential lines such as
bread in order to try and differentiate by price.
Waitrose has typically tried to differentiate through
quality and ethics in order to appeal to its premium
market segment.
 : SWOT

 STRENGTS: Reputation: Waitrose and the John

Lewis Partnership as a whole have an excellent
reputation both with customers and suppliers.
Waitrose has shared the top two positions in the
Verdict Customer Satisfaction Index with John Lewis
for a number of years.
 Structure: The corporate structure of the John Lewis
Partnership is unique for a company of its size in the
UK, and its emphasis on its employees earns it much
admiration
 : SWOT

 WEAKNES: Scale: Waitrose is a relative minnow

when compared to the big four supermarket groups.
In the past this has made it difficult to find sites
suitable for expansion. Waitrose’s size will also have
limited the economies of scale available to it.
 Price: Waitrose is typically seen to be more
expensive than all of its competitors.
 : SWOT

 OPPERTUNITIES: New branches: The opportunity

to extend Waitrose’s reach beyond its traditional
market in the South East is a real one
 Internet: Internet shopping is the fastest growing
area of retailing, and Waitrose is well placed to take
advantage of this with its partner, Ocado and its own
Waitrose Deliver service.
 Overseas: Waitrose has entered a licensing deal with
Spinney's in Dubai, which will see the established
Spinney's supermarket brand rebranded as Waitrose.
 : SWOT

 THREATS: Economic uncertainty: The John Lewis

Partnership has an “upmarket” reputation, and given
that the trend in the economy for the past 50 years
has been for increased wealth, “upmarket “could
have been considered a solid area for growth in the
mid to long term during that entire period.
 Money Supply: The Partnership had its sights set on
rapid expansion. Its plans may be thwarted to some
extent by the impact of the Credit Crunch and the
availability of loans for development.
: SUGGESTED STRATEGIES
 : CONCLUSION

 Waitrose is part of a corporation unlike any other in the UK.

Its guiding principle, that it is there for the benefit of the
employees, sets it apart from the usual business models,
and certainly from its competitors.
 The reputation for quality and service clearly differentiates
Waitrose from the big four supermarket chains and appears
to give Waitrose some upward flexibility in its pricing.
 Waitrose’s success can be aligned with its reputation as a
premium brand. The key concern is for Waitrose in the
near future is likely to be maintaining a premium brand in
very uncertain times.
 THANK YOU

ANY QUESTIONS PLEASE