A sustainability and strategic report on Sainsbury’s

Report background

The report has been prepared as the fundamental part of course module. For the successful completion of the report, efforts has been made to analyze the business strategies, market position, competitive situation, sustainability, and employee and customer management of a retail organization from retail industry of United Kingdom. The organizational ground of the reports was Sainsbury’s, one of the leading retailers in UK retail industry. For the successful analysis of the organizational issues from the context of Sainsbury’s, the issues have also been discussed from the perspective of the competitors of the organization. In the report, specially, two major competitors’ grounds have been focused: ASDA and LIDL. This is a sustainability and strategic report on Sainsbury’s.

The report has been prepared in three major sections including introduction, analysis and conclusion and recommendations. In the beginning of the report, the introduction part of the report has been placed where introduction and organizational background have been included. In the second part of the reports, the core values of Sainsbury’s, sustainability plan of Sainsbury’s, competitive environment, strategies to deal with customers and employees, marketing strategies and financial position of the organization have been analyzed and evaluated carefully. In the final section of the report, the report has been concluded and some recommendations have been developed.

Organizational Background of Sainsbury’s

According to J Sainsbury Plc, Sainsbury’s is one of the leading retailers in UK retail industry. It is the second largest retailer in the industry having 16.9% market share. The organization has been funded by John James Sainsbury by 1869 in London. It was the largest retailer in 1992 and the organization has first adapted the self-service retailing concept in 1980s. The organization has a glorious history of growth and success. In the year 1995, the leading retailer Tesco overtook Sainsbury’s and the organization remain in second leading position in UK market. During 2003, Asda became the second largest retailer and from then the organization remained third largest retailer in UK retail industry. However, the organization has regained its second position by 2014. The organization is specially a retailer; but the organization is also convenient retailer as well as banking service retailer. The organization is headquartered in Holborn Circus.  The organization is operating its business based on 20,000 stores in 55 countries across the world. The CEO of the organization is Mike Coupe. The major products of the organization are convenient/forecourt store, hyper market, super center, and super market. During 2014, the organization has earned about £23.949 billion in 2014. The organization has an employee base of 161000. The subsidiaries of the organization are Sainsbury’s Bank Plc, Sainsbury’s Supermarket Ltd, and Sainsbury’s Convenience Store Ltd. The major owners of the organization are Judith Portrait, Lord Sainsbury, Sainsbury family, Qatar Investment (Hovers, 2014). The share distributions of the organizations are given below.

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Core Values of Sainsbury’s

Consistent with J Sainsbury Plc (2015c), Salisbury’s is a highly reputed retail brand in UK retail industry. The organization has values, which are part of long-term strategy for growth as the organization values underpin their strategy. The organization believes that their values within strategy make good sense and give real competitive advantage for the organization. Sainsbury’s need to manage their significant economic, social and environmental value chain within 24 million customer transactions each week, 161000 employees and over 2000 direct supplying sites in over 55 countries. The organization mainly focuses on major five company values reflecting their key issues they face and the values of the organization are also inextricably connected to their core business goals, acceding customer expectations for healthy, safe, and testy food at fair prices. The five core values of the organization are as following.

Best food and health

The first important value followed by Sainsbury’s if the best food and health. Sainsbury’s believe that their most important responsibility is to offer people the best for food and health. They have justified reasons behind their values as they are operating their business based on offering best food to customers at fair price. However, a business based on providing great food at fair prices and with over 24 million transactions a week must ensure foods, which is best for food and health (J Sainsbury Plc). 

Sainsbury’s has taken different actions to maintain the values to provide best for food and health within their business operations. For example, the organization is continuously making reformulation of their foods to reduce salt and sugar content from the year 2011. Not only that but also, the organization is increasing more sales of light wine. It has increased 57% sales of light wine, the wine good for health.

Sourcing with integrity

The second important core value of the business of Sainsbury’s is sourcing with integrity where the organization ensures maximum customer care about where the products customers by come from. Not only that but also the organization carefully consider that customers put their trust in the organization to do the right thing on their behalf. For maintaining the core value of sourcing with integrity, the organization works with their farmers, growers and suppliers in the UK and around the world.

The organization integrates all of their stakeholders in supply chain system to ensure integrated sourcing for its stores. It has already acting in its different area to ensure sufficient integration in its sourcing process. The major actions have been taken by the organization to maintain their integrated sourcing processes are using health favoring raw materials, reduction of deforestation, sustainability of fish collection, and fairly traded goods.

Respect for environment

Respect for environment is another core value of Sainsbury’s that is reflected in the operation of its business. The organization says that their standard represents the concept Sainsbury’s can make massive difference by embedding respect for our environment in their decision making. The organization has the aim for being the UK’s greenest grocer not by reducing their impact on environment but by engaging their suppliers and others to do the same (J Sainsbury Plc).

The organization has taken different approaches to ensure the respect for environment. For example, the organization is trying to reduce wastage in their operational process, and it is using sustainable packaging system. The organization is trying to reduce its operational carbon emission and to use less water resource. The organization is emphasizing on controlling suppliers’ carbon emission.

Make a positive difference in community

The organization wants to differentiate them from its competitors competing in UK retail industry, but the organization does it positively. Additionally, the organization wants to develop a healthy community in the UK and. This is why; the organization declared that “ we set out to be a good neighbor with over 1200 stores across the UK, 23 depots and four store support centres employing 161000 employees.

For making a positive difference to the community, Sainsbury’s are contributing different sector of social and community development. For example, the organization is donating huge amount of money for kid development in UK. Currently the organization is investing huge money for the benefit customers, society and community.

A great place to work

One of the main core value of Sainsbury’s is to make the organization itself one of best workplace in UK because the organization believes that their business rests on 161000 employees, who are providing restless services to customers every data for organization benefit and customer satisfaction. The organization strongly believes that highly motivated and productive employees are the most important resource for an organization and they are critical success factor for organizational success. For that reason the organization is highly committed to give their people the opportunity to be the best they can be.

For making Sainsbury’s one of the most favorable place to work in UK, the organization has taken different steps as their business success can come only through the mutual benefits of employees and customers. For example, the organization provides continuous supports to the employees for their personal development and growth through offering huge training and development opportunities. However, the organization concerns more on employee commitment and engagement. Additionally, the organization believes in sharing success, diversity and inclusion for making it a great place for employees.

Sustainability report of Sainsbury’s

In the highly competitive global market environment, sustainable business management is a crucial part to be success. In the customer oriented market, customers are no more satisfied with quality product and reasonable price as more or less most of the organizations in the world provides the same standard of quality and reasonable pricing option. In this situation, customer wants, their organization will contribute on the benefit of society, community and environment. For that sustainable business management is of high necessity. The ability to endure and survive into the future is considered as the sustainability where business sustainability is all about incorporating social, environmental and economic factors in business decisions. However, sustainable manage of a business involves placing focus on future long-term business goal rather than temporary current goal. For sustainable business development, sustainability plan is necessary as it enable an organization achieve desired sustainability in its business operation.

According J Sainsbury Plc, Sainsbury’s is an organization which aims to be the greener retailer in UK retail market. The organization is continuously taking different actions for being sustainable retailer to achieve desired level of competitive advantage over its competitors. The organization has taken different actions for achieving suitability. The sustainability planning of the organization shows its journey addressing challenges and opportunities not only relevant to its business but also to the world. The organization has started its sustainability journey by 2011 and they introduced 20 commitments to achieve economic, environmental and social sustainability. In the next years, the organization was committed to improve their sustainability planning and actions for achieving desired level of sustainability management efficiency (The Guardian, 2011).

The organization has launched 20×20 Sustainability Plan by focusing the 20 ambitious sustainability commitments. It is continuously reviewing its commitments so as they can assess in which extent these have been achieved and in which extend they can do more for the achievement of their sustainability growth. For the achievement of the sustainability commitments, the organization has aligned its business strategy with sustainability goal. Now, the organization promise to customer to Live Well For Less has become something more than price. The organization has updated its business strategies and evolved commitments to sure it is delivering long-term value and values for customers, suppliers, employees and stakeholders. The 20 commitment on which the sustainability planning of Sainsbury has given bellow-

Healthier Baskets

It’s a commitment from Sainsbury’s to achieve its sustainability goal that customers can be able to trust on the organization that in the time of shopping in stores of the organization, customers can always choose nutritious and  healthy food. The commitment is highly important for the achievement of sustainability as day by day the health related issues are rising in British society like obesity and type-2 diabetes. The commitment will enable the customers of the organization to improve customers’ health as the organization offers nutrias and healthy foods based on the commitment. For ensuring healthier foods and drinks for the customers, Sainsbury’s has taken different steps. The organization will reform its own-brand products for diminishing salt, sugar and saturated fat. It will enrich the nutrient value and profile of its brand foods to deliver nutrias products to the customers. The organization aims to develop the healthy balance of food basket of customers. Additionally, the organization will enhance the access and selection ability for customers with allergies and intolerances and double the sales of lighter wine for health safety of customers.

Active Youth

To achieve sustainability, Sainsbury’s is highly committed to ensure active youth of the kids in UK. To achieve the commitment the organization is taking different actions to encourage kids to lead a healthy and balanced lifestyle. The commitment is highly important for achieving social sustainability as there is increasing concern relating to child obesity, e.g. one in five children in UK is suffering from obesity, whereas the commitment will enable the organization to contribute on the child obesity reduction. The organization has started its Active Kids Program during 2005 and from then the program is contributing on increasing physical activities of kids and contributing on reducing the obesity problems within young generation. The organization supports different registered schools and clubs equipments, experiences and education for cooking and sports under the Active Kids Program that helps physical wellbeing of kids. For the successful achievement of the commitment, the organization has continued to develop Active Kids Program. The organization is investing £200 million for the activities of kids from all abilities (J Sainsbury Plc, 2015e).

Raw materials

For the achievement of sustainability, Sainsbury’s is committed to ensure sustainable sourcing. For achieving the sustainable sourcing, the organization will source key raw materials based on an independent standard. To achieve sustainability goal, sustainable sourcing is highly important as the sustainable sourcing of key raw materials will assist the organization for meeting the customers’ expectations (J Sainsbury Plc, 2015e). Not only that but also it will help to provide quality product for short-run and long run of organizational business. For ensuring sustainable raw material sourcing, Sainsbury’s has taken different steps including sourcing each of key raw material based on an independent standard, avoiding the direct and indirect contribution of products on global deforestation, sourcing all products that can cause deforestation from the most possible sustainable source, and contributing on developing sustainability of business of suppliers, farmers and growers (Blue&Green, 2013).

Sustainable fish

For the achievement of sustainability, Sainsbury’s is highly committed to ensure independent sustainability certification of fish. The organization believes that a healthy ocean is highly important for earth. Not only is that healthy ocean crucial for millions of livelihood in the world. For that reason, there is no alternative but having sustainable fisheries as it determines retention of primary renewable protein source. Additionally, our planet is suffering from marine ecosystem disorder and the problem is being more intense day by data whereas sustainable fisheries will contribute on the protection of marine ecosystem. For achieving the sustainable fishing, the organization has taken some crucial sustainable action plans including ensuring independent sustainability standard based certification of wild-caught fish, which the organization will sale; managing certification for sustainability of farmed fish; and beyond the big five including cod, haddock, salmon, tuna and prawns, the fish offers are diversified.

Fair trade

Fair trade is another major commitment of Sainsbury’s to ensure sustainable goal achievement. For ensuring fair trade, the organization is committed to trade products fairly, invest suppliers’ sustainability including sustainability for farmers, growers and workers. For enhancing sustainability, fair trade is important as it enhances the livelihoods of suppliers and produces sustainable development. Not only that fair trade helps to provide customers high quality and sustainable products. For ensuring fair trade, the organization wants to growth the sales relating to fairly traded products based on strategic business approaches and the organization is planning to invest to boost the sustainable practices by suppliers, farmers, growers and workers.

British

For ensuring sustainable business practices, the organization is highly committed to invest in future British farming. Additionally, the organization wants to be the leading retailer for British products. For achieving the commitment, the organization is taking three major steps including: for helping British farmers to increase their productivity, Sainsbury’s will ensure constant communication dealing with them. However, here the organization will emphasize on the reduction of environmental impact of farming. For testing the impacts of new production process on different varieties, the organization will invest and make attention on research, development and innovation. The research and development approaches of the organization will also aim to increase yields and season length with new growing practices. The organization is highly committed for driving the sales of produce, meat and poultry, which have been produced in UK.

Animal health and welfare

The organization highly committed to ensure animal health and welfare to ensure sustainability where the organization will make independent standard of animal health and welfare. According to the standard, suppliers, who supply meat, poultry, eggs and dairy products, must be independently verified. For maintaining the sustainability issues, the organization will ensure best practice, which is shared through the supply chain. Not only that but also, the organization will support farmer development group with necessary innovation.

Packaging

For ensuring sustainable packaging, the organization is committed to reduce and maximize its brand own brand packaging. For ensuring packaging sustainability, the organization plans to reduce their brand packaging at 50% in 2020 compared to 2005. The organization is highly committed to use recycled materials in packaging. The organizational suppliers will be encouraged for reducing and optimizing packaging with a standardized best practice.

Operational wastage reduction

The organization is highly committed to reduce wastage. Not only that but also the organization wants to use the wastage in business operation positively. For the reduction of wastage, the organization is planning supporting the achievement of the objective within 2025 with the aim for reducing food and drink wastage, specially the wastage associated with production and consumption of food and drinks in UK. The organization wants to encourage its employees in reduction of all wastage. Not only that they will be carefully encouraged to ensure the positive use of the wastage. 

Sustainable sourcing

Sustainable sourcing is another major another major issue in the sustainable planning of Sainsbury’s where the organization wants to work with own-brand suppliers, farmers, and growers for detailing the product impacts.  For sustainable sourcing, the organization is planning to work with and support the suppliers, farmers and growers. The main aim of the dealing and support will be to make suppliers, farmers and growers understood the resource and carbon efficiency and improve the efficiency.  For reducing wastage and use the wastage in positive way, the organization will work with and support key suppliers, farmers and growers. Additionally, the organization aims to understand water vulnerability, improve water efficiency and promote water stewardship by working with suppliers, farmers and growers for ensuring sustainable sourcing.

Waste less and save more

For enhancing sustainability, Sainsbury’s wants to invest on customers and in this area the organization want to invest for assisting customers in reducing waste with the initiative Waste less, save more. For doing this, the organization is planning to invest about 10 million pound and the organization hope that the investment will substantially help customers and communities for reducing wastage.

Operational Carbon

The organization is committed to reduce carbon in their business operation. The organization aims to reduce operational carbon emissions by 30% absolute and 65% relative to 2005. For the reduction of store operational carbon reduction, the organization is planning to use proven and next generation renewable technologies in stores; by increasing the utilization natural refrigeration, the organization will reduce its refrigerator impact; and finally, the organization will share information and ideas to help employees to save energy are home and work.

Water

The organization is highly committed for addressing and managing all areas of water vulnerability in its business with huge water stewardship. For the achievement of their water commitment, the organization intends to enhance the level of efficiency in the use of water in operation; and for the protection of river basins and enhancing integrated water management system, the organization is committed to work with water companies, local authorities, neighbors, and NGOs (Sainsbury Plc, 2015d) . 

Community investment

The organization is committed to improve economic environment of community through supporting local communities in a better ways. The organization is planning to invest about 400 million pound for local community development within a charitable basis. The organization is planning to grow local charity programs, increase national partnership, and contributing on local community with volunteering, awareness raising, food donation and community budget donation.

Commitment and engagement, and Jobs and skills

For the achievement of sustainability, the organization wants to enhance its commitment and engagement to make a workplace where employees will love to work. The organization is planning to exceed the national wage plan of £9 per hour; to understand employees better than competitors do; and finally, to invest in employees for their training and development.

Diversification and inclusion

The organization is planning to ensure a work environment where all the members of a community will get the equal opportunity to ensure diversity and inclusion within the organization. For promoting diversity and inclusion, the organization is committed to help the people who face barriers to the workplace and they will be given the opportunities and access to jobs. Not only that but also the organization will have an inclusive workforce that reflects the community they serve.

Analysis of the sustainability report of Sainsbury’s

The sustainability planning of the organization depends on five core issues. The sustainability issues of the organization are: living healthier lives, sourcing with integrity, respect for environment, making positive difference to community, and ensuring great place to work. Based on the core issues, the success of the organization to achieve sustainability has been analyzed (Sainsbury Plc, 2015d).

For ensuring healthier lives, the organization was highly successful as about 86% of the brand’s own products have met the salt and sugar reduction target of the organization by 2015 and the organization has increased its lighter wine sales by 57% since 2010. For ensuring the integrated sustainable sourcing, the organization has achieved significant advancement in 2015. The organization has been able to use 97% palm oil which has been sustainablly certified; it has been the top rated sustainable timber sourcer; it has has sold Marine Stewardship Council certified products of 189 million pound; it has become world’s largest fair trade retailer; and the organization has invested substantial money for the development of firms. Additionally, the oganization has significantly contributed on animal welfare and sustainability standard setting (Sainsbury Plc, 2015d) .

The organization has been able to reduce about 980 tones of wastage, 2% of absolute carbon in their packaging, reduce carbon emission by 0.5%, and electricity use by 3% in 2015. Additionally, the organization has been able to reduce operational water use by 54%. By the year of 2015, the organization has donated about 160 million pound for Active Kid program to support cooking and sports equipments and experiences. The organization has invested about 52 million pound for customer, employee and supplier development. The organization has improved it s workplace significantly as the organization has trained its 33500 employees from food college; the organization has about 16150 employees with over 20 years of services; and the organization has offered 50 million pound bonus for 133000 employees.

There are some criticisms about the sustainability planning of Sainsbury’s. First of all, the organization has not been able to set any specific standard for the performance in environmental sustainability. Additionally, the organization is supporting suppliers, growers and farmers that can be harmful for local environment of suppliers, growers and farmers (The Guardian, 2011). For example, different people believe that Sainsbury’s sustainable supply chain proposal will ruin Crosby Village to be a nicer place for everyone and damage the local environment. The people of Crosby Village believe that their sustainability planning is not about people but about car.  Some critics have urged that the planning of ASDA is more sustainable than that of Sainsbury’s as it significantly supports the ecological and social environmental protection.

SWOT analysis of Sainsbury

Strength 1. Sainsbury is one of the big super markets in the UK and thus has substantial impact on the market (The Guardian, 2015). 2. Positioned as 2nd largest supermarket in the UK retail supermarket industry. 3. It has more than 161,000 effective employees around the world . 4. Its leadership team is very much efficient to expand the business throughout the world. 5. Sainsbury’s has recent collaborated with Argos and it will enhance the sales and strategic position of the company (Sainsbury, 2016). 6. It has more than 1200 supermarkets and convenient stores (Sainsbury’s., 2015). 7. Highly effective advertisement and promotional activities (The Guardian, 2015). 8. Efficient and global links of supply chain and distribution channels.

Weakness 1. Increasing food price around the world has negatively affected the food business of Sainsbury’s because food price has increased during the last year. 2. High employee turnover in the company because of the weakness of the company to retain its employees. 3. Extent of competition has been increasing rapidly in every segment of business and the company often fails to keep its position as 2nd in the UK supermarket industry.

Opportunities 1. The company can expand its business to new and potential market such as in Thailand. 2. The company already an established global supply chain management, it needs to optimize the supply chain and it should make options of supplier, thus Sainsbury will be more profitable. 3. They can gain more efficiency and profits by optimizing its supply chain management. 4. The company can gain more benefits from its employees by properly retaining and training them.

Threat 1. Emerging competitors both in the home market and in the host market (The Telegraph). 2. Competitors may find better and cheaper sources of supplies, thus Sainsbury needs to relentlessly search for better sources of products (The Telegraph). 3. Tesco is better positioned in the UK supermarket industry because this company offer complete and better solution compared to Sainsbury. Thus, customers are more attracted to Tesco.

Balance Scorecard of Sainsbury

Finance: Sainsbury aims at making the financial strength high and flexible as to respond to financial crisis (Gond et al., 2012). The company wants to accomplish this objective by enabling the company to expand its business and by making it more efficient. The company also wants to ensure open and evaluative financial system to make it more open and universal.

Customers: Sainsbury emphasizes most on its customers. The company perceives that customers are the main resource for its strength (Gond et al., 2012). Sainsbury takes extensive strategies to retain the existing ones and to gain new ones (Miah, Hossan and Golam, 2012).

Internal business process: Sainsbury believes that internal business process is a very vital issue to understand. Therefore, itemphasizes on finding the strength that the company is capable of (Hopwood, Unerman and Fries, 2010). On the basis of its strength, it accomplishes its jobs. It takes strategies to make the internal auditing system free and credible to all.

Learning and growth:It values on innovation and improvement on the business process (Miah, Hossan and Golam, 2012). Sainsbury’s search for alternative and better ways of doing jobs.

Strategic objectives: The strategic objective of the company is to keep sustainable and profitable business relationship with the customers (Hopwood, Unerman and Fries, 2010).

PESTEL analysis of Sainsbury’s

Political factors: The political environment of UK consists of political parties, election system, democratic system etc. Sainsbury conducts its business through the political environment of the country.

Economic factors: Economic system of UK significantly affects the business of Sainsbury. The interest rate, business environment, economic stability etc. affect the business of Sainsbury

Social factors: Business is integrally related with social environment of any country. Sainsbury’s business is significantly affected by its increasing age group of its population. Aging number of customers want more super stores.

Technological factors: Business needs technology. UK’s technological environment is very much developed and thus Sainsbury can effectively conducts its business.

Ecological factors: A company must not pollute its environment. UK is very much concerned about the protection of its environment. Thus, Sainsbury must keep its environment clean to increase its business reputation.

Legal factors: Legal factors of UK consist of rules and regulation, laws, policies, restrictions, consumer rights etc.. Sainsbury needs to operate its business through these factors.

Porter’s five forces analysis of Sainsbury’s

For the analysis of competitive environment of Sainsbury’s, porter’s five forces analyses has been done. In the analysis, the threats of substitute, competitive rivalry, and threat of new entrance, suppliers’ power, and buyer’s power have been analyzed and justified.

The threats of substitute

The threat of substitute for Sainsbury’s is very low as there is very low propensity of substituting the grocery products including food and non-food items. However, convenience stores can be substituting the products of the organization whereas the organization is opening 50-100 convenience shops every year to face this substitution threat from convenience shops. 

Competitive rivalry

The competitive rivalry is very high for the organization in UK retail industry as the retail market is saturated with highly competitive retail brands. For example, the retail brands including Tesco, ASDA, LiDL, Waitrose, Morison are working in the market. The top four competitors hold 66.6% of the market shares. 

Threat of new entrance

The threats of new entrance in UK retail market is moderate for Sainsbury’s as the organization playing in a market where it is very tough to enter as for the heavy investment requirement and low profit margin. However, the online retailers are increasing significantly that has created the moderate threat of entrance in the industry.

Suppliers’ power

The suppliers’ power in UK retail industry is low as organizations require very low cost for switching from one supplier to another supplier. Most of the suppliers in UK are bound to sale their products to big four retailers including ASDA, TESCO, Morison and Sainsbury’s. This is why; suppliers’ power is very low in the industry.

Buyers’ Power

The buyer’s power in the UK retail industry is very high as the customer has huge options to switch one brand to another brand and their cost for switching to one brand from another brand is very low.

Difference between Sainsbury’s and LIDL

The major competitors of Sainsbury’s are the ASDA, Tesco, JW Morison, and LIDL. For the competitors’ analysis, the ASDA and LIDL will be compared in the report. Sainsbury’s is the organization in UK retail industry which has more than 16.7% market share in UK retail industry. In contrast, ASDA is the third largest retailer in the industry with more than 16.6 % market share. Additionally, LIDL has 4.3% market share in UK. Sainsbury is a British based retail organization in UK whereas LIDL is a German based retailer and ASDA is a subsidiary of US based retail giant Walmart.

The USP of Sainsbury’s is to sale at low price with large variety of production. However, ASDA depends on the USP, always connected the customers with multi-channel media. Additionally, the USP of LIDL is to offer quality goods at affordable price. Sainsbury’s targets the retail segment, who shop online and offline. Their major target group is household and they offer varied products to the customers. The targeted segment of ASDA is moderate means, hard pressed. The target group of the organization is the majority of married living people, internet savvy. The market position of the organization is as UK’s cheapest market destination ahead of Tesco. LIDL focuses on the segment, which includes price sensitive customers with limited budget and moderate quality choice. The target group of the organization is households. The organization positions itself as a go-to shop for any grocery need.

The major strengths of Sainsbury’s are: it is one of the largest retailers in UK; the organization has over 150000 employees; and it runs by an excellent leadership team. Additionally, the organization has excellent brand position and one of the largest distribution channels with 550 supermarkets and 350 convenience shops across UK. The organization offers more than 300000 product lines with their 20% own –brand products. The organization has sustainable planning, which is giving the organization extra competitive advantage. The major weaknesses of Sainsbury’s are: the organization has limited ability to control price as rising food price across the world is forcing the organization to sale their products at high price, which can discourage the customers to visit their stores. High level of competition in the retail industry can make the organization vulnerable in market.

In contrast, the major strengths of ASDA are: the organization offers financial services along with a wide range of product variety. But the product variety of the organization is less than Sainsbury. The organization has strong advertising ability and the organization is highly efficient to communicate with customers through social networking. The organization has CSR initiatives to perform social responsibility, but it is not efficient in comparison to sustainability initiatives of Sainsbury’s. The organization has an employee fleet of 140000, which is less than that of Sainsbury’s. Unlike Sainsbury’s, ASDA has very limited global presence, high price range and international restriction has restrains its global growth whereas Sainsbury’s is operating its business in more than 55 countries.

However, LIDL offers wide variety of retail product. The organizational variety is less than Sainsbury’s and ASDA. The organization has own brand products, but these are not comparable to the products of Sainsbury’s or ASDA. But, the organization has strongest ability to offer reasonable price to the customer and a huge number of the price sensitive customers visit the stores at least once a weak. But the product quality of LIDL is mediocre and the number of stores in UK is smaller than that of Sainsbury’s and ASDA. The organization is opened in every day in the week including holiday unlike Sainsbury’s and ASDA. Compared to Sainsbury’s and ASDA, the organization is still relatively small in size and market share. Additionally, the organization has very limited global access unlike Sainsbury’s.

How Sainsbury’s Deals with customers

Sainsbury’s is one of the highly reputed retail organizations in UK trying to offer maximum satisfaction to the customers. Recently, the organization redefined their goal so as to reflect their commitment to satisfy customers’ needs. The organization wants to be the most trusted retailer where people love to work and shop. The organizational goals and strategies aim to make customers’ lives easier. It offers high quality products and services at fair price. Not only that the organization ensures offering products to customers the products and services where they want. Sainsbury’s believe that they understand their customer more any other else in the industry. The employees of the organization are highly committed and trained to deliver maximum values to the customers. Not only that the organization wants to maximize the customer experiences with the organization and perform high responsibility for customer benefits with their sustainability planning (J Sainsbury Plc, 2015i).

Excellently understands customers’ needs

Sainsbury is highly careful to deal with customers as they understand the customer needs efficiently and design and deliver the products and service to the customers according to the exact needs of them. In comparison to ASDA and LIDL, Sainsbury’s has the high ability to offer a wide range of products and services as the organization offers 40000 products whereas ASDA has only 30000 products and LIDL has less than 30000 products to offer to customers. The organization is highly careful to ensure fair value paid by customers. The organization wants to minimize the waiting time to deal with customers and the organization developed a multi-skilled employment based to ensure enjoyable buying experience of customers in the organization (The Guardian, 2016).

Supports the elderly customers

The organization strongly supports the elderly customers and to support the customers, the organization has put chairs to rest by the elderly customers in the stores. Not only that, the organization trained and directed their employees to help elderly customers to pack their products and take them to their cars. The organization is highly careful for dealing with disable customers perfectly. To support disable customers, it offers specialized services including disability parking space, wheel chairs, parking spaces and electric scooters. The organization is strongly concerned about the satisfaction of customers, for example if any customer wants a product currently unavailable, the organization manages it as soon as possible for the customers.

Keeps the products in the right place

To deal with customer efficiently, the organization keep their products in right place and keep the stores neat, tidy and organizes so as the customer can find their products very easily. The products of the organization are well-packaged and ensure the process in which customers can easily achieve quality products from the stores. For delivering maximum quality of product, the organization has a quality assurance team which ensures the product and service offered to customers is consistently meeting the quality standard of products and services. The organization is going to ensure a sustainable supply chain, which can offer customers healthier products with desired quality standard.

Putting customers at the heart of the strategy

The organization is highly careful to meet customer needs efficiently and to do this; the organization has shaped its product, marketing and store strategies according to the needs of customers. Not only that but also, the organization is always ready to change the strategy according to the change of customer needs. It highly focuses on the target customers and their personalization.

Utilization of data efficiently

The organization shares information and data with customers so as customer can assess the performance of their products, categories, merchandising and promotions. For example, the organization discloses their changing decisions and changing policies to the customers as soon as possible.

Building efficient partnership framework

For supporting customers efficiently with quality products and services, the organization is investing huge money for building a sustainable and integrated supply chain network. The supply chain will ensure quality supply of raw materials and products for the successful to ensure healthier lives of customer.

How Sainsbury’s deals with employees

Recruitment and selection procedures: Recruitment and selection process of Sainsbury is very straightforward and routine (targetjobs.co.uk, 2015). They collect CVs from the aspired applicants and targeted employees of other firms from various sources. After an evaluation of potential candidates for a particular job, it selects the most appropriate employees for the job. Recruitment policies of both ASDA and LIDL are similar to Sainsbury (ASDA, 2015).

Performance evaluation

Executives’ performances are measured on the basis of financial performance of the firm, and the proper implementation of strategic goals of it. Predetermined standard for individual performance is also compared to the actual performances of them (glassdoor.co.uk, 2016).With negligible differences the performance evaluation procedures of its competitors such as ASDA, LIDL, TESCO etc. are very similar.

Compensation and Benefits

Employees of Sainsbury get compensation in various forms such as basic salary, annual bonus, pension, all employees shared plan, long term incentives etc. As the human resource market is competitive and employees can easily switch to is competitive firms (TESCO, ASDA etc.), Sainsbury has no alternative but to provide enough compensation which are mention above to retain its employees. Other firms of this industry like Tesco, ASDA, and LIDL etc. are also bound to provide those types of compensation to motivate their present employees and attract potential employees to firm

Market Segmentation strategy of Sainsbury

Sainsbury sells various types of products to various groups of consumers. If we observes the products range of Sainsbury we can find out that its products’ prices also vary on the basis of some sorts of classification of similar or identical products. So the market segmentation for Sainsbury can be defined as:

Age group: Sells products for multiple age group with no special emphasis to a particular group.

Gender: Female consumer’s products are highlighted in the product portfolio of Sainsbury.

Income level of consumers: focus more on middle class to lower middle class consumers. But ASDA and LIDL focus on middle class to upper middle class of the society (LIDL, 2016).

Target market of Sainsbury: Sainsbury targets various group and sub group of its market segments for positioning placing its message to consumers.

Marketing Mix (4Ps) of Sainsbury’s

Product: Sainsbury sells various range of grocery and foods items to consumers like its competitors ASDA, LIDL(j-sainsbury.co.uk, 2016; LIDL, 2016).Sainsbury focuses more on middle class family which has moderate purchasing power.

Price: the price range of the product of Sainsbury is affordable to middle class to lower class income group ((j-sainsbury.co.uk, 2016).So the price is not certainly high. The price of the products of ASDA and LIDL is comparatively higher than Sainsbury.

Place: Sainsbury sells its products in supermarkets and stores. It also has significant existence in online business like selling goods through apps and websites (j-Sainsbury, 2016).it has 1200 stores in the forms of superstores and mixed use development,ASDA has more than 525 stores in UK and LIDL has more than 600 stores in UK. Both LIDL and ASDA also sell their products via online.

Promotion: Sainsbury uses internet (Google search engine, social networking sites etc.) extensively to promote its products alongside with traditional platform like Newspaper, magazines, TV commercial etc. Although ASDA and LIDL have limited presence on online comparing to Sainsbury, they promote their products with traditional medium.

Business Channels of Sainsbury’s

In business, channel refers to the medium through which a company sells its products and services and earn money. The business channels of Sainsbury’s are discussed below:

Sainsbury Online: It offers online booking and home delivery of grocery items with affordable price (Sainsbury’s). The company has emphasized much to develop the online presence and proximity to the customers.

Sainsbury stores: It offer attractive and best suitable goods at its stores.

Sainsbury Property: It also has property business through which Sainsbury’s develops property, lends property and initiates projects.

Bank: Sainsbury has banking business which offers personal loans, credit cards, home insurance, pet insurance, travel money etc. (Sainsbury Bank). Financial activities and financial business of the company is conducted through its bank.

Sainsbury Energy: It offers gas, electricity, dual fuel, boilers and energy (Sainsbury’s Energy). Energy business of the company plays a vital role in the financial position of the company.

Competitive advantage of Sainsbury’s in the UK grocery market:

Sainsbury has got some competitive advantage in the UK grocery industry and such competitive advantage has helped the company to be more competitive and to gain more market share in that industry.

• Sainsbury already has established brand value and reputation that very few of grocery stores have. It has enabled the company to get more customers.
• Sainsbury has stood 2^nd position in the industry.
• Is has 1200 establishments and a strong chain of network which is not common in other competitors. Such position has kept Sainsbury ahead of competition.
•  Sainsbury has effective offers such as Nectar cards, such offers and strategies have attracted so many customers.
• Effective use of technology in Sainsbury is another competitive advantage. Such technologies have kept the company ahead of competition.

Key driver of business change and Sainsbury’s responses

There are some significant changes in the UK grocery industry and among the customers. The factors of key drivers are outlined below:

• Use of technology
• Online shopping
• Home delivery
• E-service and information
• Saving and points cards
• Higher level of customer satisfaction
• Integrated services

The above factors are the key factors for changes in the UK grocery industry. Sainsbury has also adapted with the above changes, the company uses advanced technologies such as ERP technology- it has enabled the company to keep records of sales, inventory, it also helps the company to provide supply and inventory information to suppliers. To make online shopping available, Sainsbury has also implemented online shopping opportunities and online payment scope. The company delivers the ordered goods and services to the homes of suppliers. Nectar card is an example through which the company encourages its customers more to purchase again and again from the same company. Therefore, customers are encouraged too.

Sainsbury’s attractiveness to institutional investors

Sainsbury is very much attractive to institutional investors because market share of the company is high, it has second position in the UK grocery industry, moreover, recent positive changes at the company has brought huge positive impact on the organization. Sainsbury has the 2^nd largest sales volume in the industry and the market share is also the 2^nd largest. Moreover, it has more than 1200 outlets- these factors play very significant role for the institutional investors in case of having investment from them. Considering above factors and situation, it can be concluded that Sainsbury is very much attractive to the institutional investors

CONCLUSION AND RECOMMENDATIONS

The report presents that the five major core values of Sainsbury’s are offering best food and health, sourcing with integrity, respecting environment, making a positive difference in community, and offering a  great place to work. The organization has started its sustainability journey by 2011 and it introduced 20 commitments to achieve economic, environmental and social sustainability. In the next years, the organization was committed to improve their sustainability planning and actions for achieving desired level of sustainability management efficiency. There are some criticisms about the sustainability planning of Sainsbury’s. The organization has not been able to set any specific standard for the performance in environmental sustainability. Additionally, the organization is supporting suppliers, growers and farmers that can be harmful for local environment of suppliers, growers and farmers.

For the successful achievement of sustainability, Sainsbury’s should design and apply specific standard for the performance measurement in environmental sustainability efforts. Additionally, the organization should be more concerned to achieve social and community sustainability. The major weaknesses of Sainsbury’s are the organization has limited ability to control price as rising food price across the world is forcing the organization to sale their products at high price, which can discourage the customers to visit their stores. The organization should enhance its price reasonability to ensure desired growth and success. If we consider the recruitment and selection process of Sainsbury, it is very straightforward and routine. It is well known that the power of online business has evolved to a significant stage, so, the firm like Sainsbury try to communicate its massage by the helps of various online tools like social networking sites Google ads service, various apps and websites etc. It is a significant characteristic of Sainsbury that over the years profit growth of it has been decreasing. In the year 2015 the profit of the firm has been reduced substantially.

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