Woolworths

Business Assessment 1
Yousif Fathullah
Prime function of woolworths

 Woolworths prime functions are to sell the daily goods which are needed by
consumers on a daily basis. There goal is to give the best quality products at
the lowest prices while still trying to maximise their profits. This is to beat
many competitors which exist in the same area these could be large
businesses like coles or small business like a fruit shop offering the same
products as woolworths at the same price or lower.
 Examples of the products which are available in Woolworths include fruits,
vegetables, bread, milk and many more daily necessities needed by all
households. They sell needs as well as wants. Woolworths also sell lactose
free products in order to support the people who are lactose intolerant this
bring more consumers to their shop as they sell specialized goods.
The size of the
business:
Woolworths
Many factors decide if a business is
small, medium or large this include
the number of employees, number
of owners, market share and the
legal structure of a business.
Woolworths number of employees
Employees are those who are hired to do the work for for the
business.
According to the quantitative measurements which are provided by the
Australian Bureau Of Statistics businesses could be defined as the following :
 Micro business: a business with fewer than five employees
 Small business: a business with 5-19 employees
 Medium business: a business with 20-199 employees
 Large business: a business with more than 200 employees
Woolworths claim that they employ over 200 thousand team members. This
means that it is classified as a large business as it is well over 200 employees.
 Woolworths number of owners
 Woolworths has over 350000 public share
holders which are mostly located in Australia.
Market share
 Woolworths is estimated to have over 33%
($34 billion) market share in the total fresh
food and grocery market.This means they
have the largest share in the grocery sector
with second place being Coles with
27%(27.4billion).This demonstrates the
dominance of Woolworth in Australia as
compared to any other grocery shop.
Geographical spread of woolworths
 Woolworths is a global business which means it is a large company that branches in many
different countries. It represents the highest level of involvement in global business. As for
Woolworths national borders do not represent barriers to trade. Woolworths home base is
Australia however the company has spread into other countries internationally an example is
the spread of Woolworth's into new Zealand however the business name in new Zealand differs
ands is named countdown.
 Positives of globalization:
 Expansion in to other countries gives you access to new markets.When a company has succeded
thoroughly in its home country it only makes sense to go international.With the access to the
new market there will be plenty of opportunities to grow your consumer base and expand it.
 Another positive is staying ahead of your national competitors. For example as Woolworth
expanded into other countries like new Zealand Coles stayed as a national company. Therefor
allowing Woolworth to surpass their consumer base and to gain more international recognition.
 Negatives of globalisation:
 Risk of losing money due business being unable to attract consumers in a different country this
could be mainly due to competitors or similar businesses which are already established in that
country for a longer period of time.
 Another negative is the different tax rates in different countries. Some countries may have a
higher tax rate this could eventually lead to the business needing to increase the price of good.
However, this is not always the case as some countries have lower tax rates then Australia such
as when Woolworths opened in new Zealand they did not have to pay as much tax as they pay in
Australia
 There is five main industry sectors these include the
following primary (natural resources), secondary (uses
What type of materials from the primary industry to manufacture
goods) ,tertiary (provides services), quaternary
industry is (information processing) and quinary (domestic services).
Woolworths belong to the tertiary sector as they purchase
Woolworths manufactured goods from businesses in the secondary
industries. These goods are then sold to the daily
consumers.
Legal structure of
Woolworths
 Legal structure refers to how the business is viewed in the eyes of the
law in regards to operation and ownership. It determines who owns the
business and how it is operated.
 Businesses could be split into two categories unincorporated and
incorporated
 incorporated refers to a process a company goes through to become a
separate legal entity from the owners.
 Unincorporated business has no separate legal existence from its owners.
 The four main legal structures are sole trader and partnership
(unincorporated) and public and private company (incorporated)
 Woolworths is a incorporated company as it is a public company.This
means it is listed on the austraaalian stock exchange ,Allowing the public
to buy a share of the company.
 The advantges of woolworths being a public company include limited
liability, can tranfer ownership easily and company tax rate lower than
personal tax rate.
 The disadvantages include cost of formation, double taxation and public
disclosure which means certain information will be reported to the
public.
Internal and external influences which impact on
Woolworths
 Internal influences :It refers to the factors within the business which can
impact on the way the business operates or functions. There are five key
influences these include product, location, management, resource
management and business culture. An internal influence which is thoroughly
visible at Woolworths is the donations which are often done by the company.
They encourage many of there daily consumers to join in the donation which
are for national causes. An example Is that Woolworths has now pledged to
donate $100000 to help the people affected by the floods. They also
encourage the customers to round up their purchases which are above $30.
 External influences: External influences are factors which the business has
little control such as government policies, technology, economic conditions
and social attitudes. An example of external influences which appear at
Woolworths is the technological advancement and competitive situations.
Woolworths has released a new technology in order to help online shoppers. It
allows them to shop more efficiently. This helps Woolworths have a
competitive advantage as many other retailers are yet to adopt this new
technology such as Coles and Aldi.
Stake holders of Woolworths
 The government: They are classified as major stake holders as they collect tax from
Woolworths (corporate income taxes) ,the employees which work there (payroll taxes)
and from other spending's Woolworths incurs (sales taxes).If Woolworths cannot pay
its taxes this could impact the government as this will reduce the amount of money
which the government can use to improve the country.
 Suppliers: Suppliers are those who sell goods to businesses such as Woolworths usually
in bulk. They rely on Woolworths to gain income from there sales of their products
while Woolworths relies on them to produce enough goods. If Woolworths stops
buying, there products it could reduce their sales drastically and could eventually lead
to the supplier shutting down.
 Employees: Employees have a direct stake in Woolworths as they directly interact
with the customers and they also give support to the business operations.
 Consumers: Customers are the people which buy the products of a business..A
business doesn’t exist without there customer base which takes years to build up.
Without customers Woolworths wouldn’t have any sales this could cause it to shut
down. Loyal customers are very important aspect to a business thefore they should try
not to lose the trust of customers by always providing the best quality for a fair price.
Business life cyle
:Woolworths
 Woolworths current rate of profit and growth depict
that they are in the maturity stage of the business
cycle as they are rising however are slow.
 The maturity stage is the third stage of the business
cycle. While businesses are in the maturity stage
they experience sales going up but at slower rates
then usual and growth stage has also slowed down.
These are an early warnings of imminent 98danger.
 Challenges which are faced in the maturity stage
include sales start to plateau, market for product is
saturated and focus on remaining competitive
 Strategies to use during maturity include focus on
cutting costs, diversify into new products and find
ways to grow the value of the business.
https://www.9news.com.au/national/nsw-queensland-
floods-woolworths-boost-support-salvation-army-
donation/d2d56f80-83e8-4403-83fb-5a4194486251