This 11 page paper examines the UK supermarket industry. This is an industry that is currently dominated by companies such as Tesco, Sainsbury and Asda, but the activities of companies such as Safeway, Morrison’s, Waitrose and Iceland indicate that there is change taking place. The paper examines the situation by using a LoNGPEST analysis, with looks at the political, economic social and technological influences in a local, national and global context. The paper then used Porter’s five forces model to examine the threats, looking at the threats from existing and new competitors, the power of buyer and suppliers and the power of substitutes. The final part of the paper compares the marketing strategies of the two largest competitors; Tesco and Sainsbury. The bibliography cites 7 sources.
Name of Research Paper File: TS14_TEuksuper.rtf
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concentration id high, and the market responses indicate this position. To understand the supermarket position in a full context this can be examined from the perspective of a LoNGPEST analysis
and then using Porters Five Forces model. LoNGPEST The LoNGPEST analysis uses a usual PEST analysis that looks at the political, economic, social and technological influences and determines
them on a local, national and global basis. Political There are many political influences in terms of supermarkets. On a local level there has been increasing difficult in
terms of gain planning permission from local councils. The trend of building out of town stores may meet with many of the social trends and may also be more cost
effective with the ability to provide ample parking, However the trend is also taking consumers out of town centres and hurting smaller business, The result has been an increased reluctance
on the part of many councils to grant planning permission to the larger superstores. Nationally there are other political influences. There has been an investigation by the government into
the way that prices are such that there is a higher than average profit in the UK supermarkets when compared to the countries. This was a lengthy government investigation, however,
it was found that no price fixing was occurring and that the increased profit was mainly attributable to more expensive overheads and development costs in the UK. Global politics
may be seen as far removed from the supermarket, but there are some influences still felt. For example, during disputes with France the French goods tend to fall in sales,
with alternative, such as Italian Wine or Somerset Brie being sold instead. Other influences will also be felt, for example, when the wars in the middle east began there were
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