Purchasing Goods Produces Winners And Losers

We have all been to a supermarket or store at some point in our lives. Have we found ourselves placing items in the cart that we did not come to buy, and why is that? Is there a reason the products we need are located in the back of the store? Marion Nestle wrote an article entitled, “The Supermarket: Prime Real Estate.” She teaches in the department of nutrition and food studies at New York University. Nestle writes a column regarding food for the San Francisco Chronicle. Shortly after reading the title, one can determine Nestle opposes supermarkets. “Prime Real Estate,” indicates that large supermarkets are feeding grounds for them against unsuspecting customers. Supermarkets can determine what somebody will buy, based on where the store places certain products. The general argument made by Nestle in her work, “The Supermarket: Prime Real Estate, is that supermarkets are taking advantage of our unconscious mind and we are purchasing products on impulse.

1. Introduction The intended purpose of this report is to outline the nature of the Australian retail market, specifically the retail food sector. This report will then discuss the role of market segmentation and how it has resulted in the emergence of new retail channels available to consumers. The emergence of ALDI as a new retail channel will be the focal point of the report along with a brief overview of other new-coming organizations such as Costco. Through the use of current journal articles, books, internet sites and government publications, this report will outline the benefits of the new retail channels available to consumers, especially in regards to saving on common expenses. This report will also discuss the possible room for

Grocery industry is a highly competitive market with thin profit margins. Super markets are dominant players in the grocery industry. They use grocery offerings to drive traffic to their higher profit margin retail items. With its operations efficiency, Walmart, the largest grocery retailer has been able to offer significant price drops. This also forces other grocery stores to drop prices which keeps the profit margin thin. Even with all the advantages of operational efficiency and economies of scale, Walmart’s share in grocery sales was down at 51% in 2011.

Operating on very thin profit margins, players in the supermarket industry traditionally either focus on a premium segment or follow a discounter strategy at the low end. Premium players address educated and more price elastic consumers who value healthy, natural and organic food; the share of perishable items for these players is normally distinctly higher. Players that focus on a discounter strategy offer a higher share of simple necessity items and value price competitiveness over premium features like healthiness or organic origin. Independently of the focused customer group it is imperative for players in the supermarket industry to be cost efficient and optimize operations

Shopping can and should be about more than just price or convenience. Moreover, for high street and main street retailer, concentrating only on price means losing the opportunity to build genuine brand loyalty or give shoppers a reason to enjoy their visit.

• The average grocery store has 47,000 products which makes it look like there is a large variety of choice – but it is an illusion – there are only a few major companies and a few major crops involved

Also, there is such a thing called supply and demand, and the consumer chooses what is needed or wanted. This article also signified the evolution of the English economy of moving away of mercantilism capitalism. Both the articles had a significant impact on the societies of each state.

The UK supermarket industry resembles an oligopolistic industry, with several characteristics. Oligopolistic markets tend to be characterised by high concentration ratios, barriers to entry and…Since the turn of the century, the industry has been scrutinised by both the Office of Fair Trading and has been referred to the Competition Commission on two occasions. (Seely, 2012)

The UK supermarket industry is a very competitive and profitable industry. It is made up of four main players with significant share of the market, and then various smaller companies who focus on smaller niches in the market such as the bottom of the market discounters and the top of the line speciality stores. It is an interesting market and this report evaluates the attractiveness of the industry using Porter’s five forces model with an insight into how market nicher Waitrose sustains a competitive advantage. Next this report looks at how major player Sainsbury’s successfully competes against its rivals using differentiation strategies, and analyses current consumer trends and problems can effect this industry.

Change in demographic has also cause changes in supermarket spending. Change in age and population demographic not only influence the location decision but also influence the variety of products offered between supermarkets. Moreover increase in population growth has also raise the number of supermarkets in Australia.

High employment rates and a family culture are the main contributors to the lack of substitute services. Possible threats such as restaurants or takeaway stores do exist; however, their threat is minimal. Conversely, the intensity of rivalry among competitors is strong. In terms of market share it is extremely difficult for Aldi to penetrate the dominance of Woolworths and Coles, especially considering the current price war breaking out.

1. In the supermarket industry, firms operate by way of retail stores in different size and shapes that incorporates low profit margins. Supermarket industry provides easy access to the customers to meet their requirements as per the standard of living that helps in generating revenues. The firms involved in the supermarket industry operates to create value by following the current trends results in generating values, profitability and economies of scale.

Supermarkets also claim that their economic leverage enables them to benefit local communities by building stores and providing social and economic regeneration packages. One such example is Linwood, on the outskirts of Glasgow (Allen, 2009). The closure of a main employer left the centre of Linwood economically scarred. A proposal to build a new Tesco supermarket in the area and attract other special retailers to the ailing Town Centre was met with enthusiasm by local residents. Supporters of supermarkets advocate that everyone within the supply chain (customers, communities and suppliers) benefit from supermarkets, a concept Dennis Wrong terms the “positive sum game” (Allen, 2009).

As consumers we have gained through better prices often more consistent quality and often better choice but are we really better off. Growth in Number and Diversity of Supermarkets The growth of the supermarket has been the success story in our times, when they first appeared some specialized in fruit, vegetables and food items and others went for the opposite way with non-food as the core of the business, but slowly they have converged and built bigger and bigger out of town stores and now sell anything from paint to toys to a mouse for your computer to fresh bananas. As they have grown a few very powerful forces in supermarket retailing dominate the market in each country. Changes in the Local Corner Shop

The most recent IGD research from a research and charity organization, about the grocery market in the UK shows that the market is experiencing market growth (currently at 1.7% Growth rate) . The retail market in the UK plays a significant role in the country. In 2014, it provided £177.5 billion to UK economic output in (11% of the aggregate output). Even though the UK was in a financial crisis in 2008 that led to lower consumption, high unemployment, unstable prices and a decrease in the annual economic growth rate over the last decade the market has grown from £124.6 billion to £177.5 billion. The major channels of this market are Hypermarkets and Superstores, large retailors offering a wide range of groceries and additional non-food items.