Analysis of the Uk Grocery Retail Industry

Analysis of the UK grocery retail industry

Table of contents

Page

1.0 Introduction 3

2.0 Terms of references 3

2.1 The question 3

2.2 Methodology 3

3.0 Identification of main competitors 3

4.0 Assessment of relative market share 3

5.0 Relative significance of each competitor 4

5.1 Tesco 4

5.2 Sainsbury’s 5

5.3 ASDA 6

6.0 Potential for each competitor to capitalize on Internet technologies 7

6.1 Tesco 7

6.2 Sainsbury’s 7

6.3 ASDA 7

7.0 Potential threat on new entrants into the retail sector 8

8.0 Conclusion 9

9.0 Bibliography 10

Figures:

Figure 1. Market share 4

Figure 2. Sainsbury’s mission 5

Figure 3. Porters Five Forces model 8

1.0 Introduction

The Authors has conducted this report to inform a North American retail group about the UK grocery retailer of the condition of the sector. The report will present an analysis on the three largest grocery retailers to help the North American group to have a clearer understanding about the market in Britain.

2.0 Terms of references

2.1 The Question

The Authors have been assigned to analysis the retail grocery sector in the UK, the following statements will be answered; identification of the main competitors, assessment of relative market share, relative significant of each competitors, potential for each competitor to capitalise on internet technologies and potential threats of the new entrants into the retail sector.

2.2 Methodology

This report has been conducted by using secondary source in form of textbooks, Internet, journals, annual report and a video. The main resources of information were taken from Internet and the annual reports for Tesco and Sainsbury’s. This has provided the writers with a clear understanding of the UK retail grocery market.

3.0 Identification of main competitors

According to the internet site Kamcity (2003) which have conducted a research on the UK grocery retailers, the five largest grocery stores in 2001 was as followed;

1. Tesco

2. Sainsbury

3. ASDA

4. Safeway

5. Somerfield

The Authors have decided to focus on the top three of the largest grocery stores and these will be examined throughout this report.

4.0 Assessment of the relative market share

The approximate value of the food retail market is Ј65,3bn in the UK. Of them 16,5% belongs to Tesco who has the largest market share (Tesco, 2003). At second place comes Sainsbury’s who has 11,6% market share, ASDA has 9,6%. The five