STRATEGIC MANUFACTURING MANAGEMENT

Woolworths is Australia’s largest supermarket chain with 872 stores and
111,000 staff [1]. It has a network of stores, distribution across Australia. In
addition to Woolworths Supermarkets, Woolworths Limited also owns Big W,
Masters, BWS, Dan Murphy’s, Ezibuy, Woolworths Money, ALH Hotels, Langtons,
Cellarmasters, Woolworths Petrol, Countdown and Thomas DuX.

In 2014, Woolworths Supermarket sales in Australia were $41.2 billion, which
was an increase of 4.7% on 2013 and online sales grew by more than 35%.
During the year, market share, customer numbers, items sold and sales per
square metre all increased. On average 21.1 million customers were served per
week, which was an increase of 3.7% on the previous year. During the year,
Woolworths prices decreased by an average of 3.1%.

Woolworths sources 96% of all fresh fruit and vegetables and 100% of fresh
meat from Australian farmers and growers. Woolworths slogan is “Woolworths
the Fresh Food People” On their corporate website Woolworths state: “Without
our many thousands of suppliers, we would not have anything to sell and
wouldn’t have a business. But we always have to strike the right balance
between the best interests of the customer and the interests of the supplier and
this can sometimes involve making tough but fair decisions.”

More than 80 percent of Woolworths suppliers have been partners for a decade
or longer. In addition, 90 percent of grocery sales come from the national brands,
while the remainder are the ‘Homebrand’ generic range or the ‘Macro’ health
food range.

Questions:

Each question is short answer (500 – 1000 words) and each is worth 6 marks for
a total of 30 marks.

1: Who are the main customer groups (or potential customer groups) within the
industry? In what ways might they exercise their influence? How would you
describe their bargaining power?

2: Who are the main supplier groups (or potential supplier groups) within the
industry? In what ways might they exercise their influence? How would you
describe their bargaining power?

3: Who are the principal competitors in the industry? What strategy do they
employ to compete with Woolworths?

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MANF6860
STRATEGIC
MANUFACTURING
MANAGEMENT

Assignment
1:

2015

Available:

30
March
2015

Due:

23:59
13
April
2015

Woolworths
is
Australia’s
largest
supermarket
chain
with
872
stores
and

111,000
staff
[1].
It
has
a
network
of
stores,
distribution
across
Australia.
In

addition
to
Woolworths
Supermarkets,
Woolworths
Limited
also
owns
Big
W,

Masters,
BWS,
Dan
Murphy’s,
Ezibuy,
Woolworths
Money,
ALH
Hotels,
Langtons,

Cellarmasters,
Woolworths
Petrol,
Countdown
and
Thomas
Dux.

In
2014,
Woolworths
Supermarket
sales
in
Australia
were
$41.2
billion,
which

was
an
increase
of
4.7%
on
2013
and
online
sales
grew
by
more
than
35%.

During
the
year,
market
share,
customer
numbers,
items
sold
and
sales
per

square
metre
all
increased.
On
average
21.1
million
customers
were
served
per

week,
which
was
an
increase
of
3.7%
on
the
previous
year.
During
the
year,

Woolworths
prices
decreased
by
an
average
of
3.1%.

Woolworths
sources
96%
of
all
fresh
fruit
and
vegetables
and
100%
of
fresh

meat
from
Australian
farmers
and
growers.
Woolworths
slogan
is
“Woolworths

the
Fresh
Food
People”
On
their
corporate
website
Woolworths
state:
“Without

our
many
thousands
of
suppliers,
we
would
not
have
anything
to
sell
and

wouldn’t
have
a
business.
But
we
always
have
to
strike
the
right
balance

between
the
best
interests
of
the
customer
and
the
interests
of
the
supplier
and

this
can
sometimes
involve
making
tough
but
fair
decisions.”

More
than
80
percent
of
Woolworths
suppliers
have
been
partners
for
a
decade

or
longer.
In
addition,
90
percent
of
grocery
sales
come
from
the
national
brands,

while
the
remainder
are
the
‘Homebrand’
generic
range
or
the
‘Macro’
health

food
range.

Questions:

Each
question
is
short
answer
(500
–
1000
words)
and
each
is
worth
6
marks
for

a
total
of
30
marks.

1:
Who
are
the
main
customer
groups
(or
potential
customer
groups)
within
the

industry?
In
what
ways
might
they
exercise
their
influence?
How
would
you

describe
their
bargaining
power?

2:
Who
are
the
main
supplier
groups
(or
potential
supplier
groups)
within
the

industry?
In
what
ways
might
they
exercise
their
influence?
How
would
you

describe
their
bargaining
power?

3:
Who
are
the
principal
competitors
in
the
industry?
What
strategy
do
they

employ
to
compete
with
Woolworths?

4:
Indicate
any
current
or
potential
substitutes
or
new
entrants
that
might
fulfil

the
same
basic
function
as
the
principal
products
or
services
Woolworths.

What
barriers
might
exist
to
prevent
companies
from
entering
this