Coles Analysis

Who are the major competitors to Coles and how are the competitors positioned relative to Coles?

Major Competitors:

* Woolworths

* Franklins

* David Holdings

* QIW

* Jewel

* Composite Buyers

SALES ($m) MARKET SHARE%

Company 85/86 86/87 87/88 85/86 86/87 87/88

Coles Myer 4370 4606 5055 26.3 25.5 26.4

Woolworths 4827 5468 5717 29.1 30.3 29.9

Franklins 815 1250 1675 4.9 6.9 8.7

Davids Holdings 1200 2200 2200 7.2 12.2 11.5

QIW Na 362 362 0.0 2.0 1.9

Jewel 140 400 550 0.8 2.2 2.9

Composite Buyer 230 383 937 1.4 2.1 4.9

Total for above 11582 14669 16496 69.8 81.3 86.1

All Aust. Grocer 16585 18034 19152 100.0 100.0 100.0

The four major Supermarket operators were Coles Myer, Woolworths, Franklins, and Jewel. Based on the table above we can see that Coles Myers major competitor Woolworths Limited, had the highest amount of sales in all there years between 1985-88, whilst it also had the largest market shares. Franklins Sales were growing ($815m in 1985 to $1675m in 1988) but still very low compared to Coles or Woolworths, its market share was also growing but still no where compared to the top 2 competitors.

What are the competitors Strengths and Weaknesses?

Strengths:

* All the major competitors managed their own warehousing and controlled their distribution via their own distribution divisions or by contraction this activity to transportation companies.

* Closure of unprofitable stores

* Reducing inventory through improvement of inventory management.

* Selling inconsistent businesses

* Reducing interest and overhead costs

* Improving management information systems

* Improving distribution - gaining direct control of NSW distribution

* Focusing on core businesses

* Refurbishment of existing stores

* Shifting retail focus from serviced variety to self-service style.

* Following a diversification strategy

* Having well trained personnel offering better service, higher quality and a wider range of products.

* Catering for local interest by providing products that suited ethnic food lovers

* Setting up stores with no shelves - distributed standard ordering forms to households the shoppers selected items and quantities from the catalogues and dropped the shopping list into the store on the way to work

* Orders entered on a computer terminal at the store and transmitted to the warehouse for picking. Packed goods were then delivered to the store ready to be picked up by the customer later in the day.

* Installed EDIs that potentially replaced the traditional paper-based orders, invoices and credit notes. - EDI's promised significant saving both as an operations and management tool.

* Developing a 2 - layer controlled atmosphere packaging technique to keep meat and fish in prime condition for up to 12 days under chill. This would result in lower packaging costs and uniform quality control

* New