Hand-in Assignment

Introduction
A supermarket business founded by William Murduch Morrison back in 1899 starting as a wholesale egg merchant, then changed into a retail organization after becoming a private limited company. The company’s breakthrough happened during the 1960’s when Morrison’s first supermarket was opened, then followed by two other supermarkets, and during that period the Morrison’s ‘M’ logo was designed. More business grow occurred by the acquisition of Whelan Discount Stores and the development of new headquarters and other facilities, the business grew until to a point where the warehouse and distribution centre has become too small in the 1980’s, where the decision came to open a new warehouse, and continue the development (Williamson et al, 2004).
As the corporate strategy of Morrison is not cleared by the organization itself in the case study (Williamson et al, 2004), but that does not mean they do not have one, all organizations do. A simple explanation of Morrisons corporate strategy is to be a specialist in food for all level of consumers, by focusing on three main values which are the freshness and quality of food, value of product, and service.

Business Strategy
Ansoff Matrix
Ansoff matrix can help in screening options to business growth in the industry and choose the best option considering different situations (Internet). Generally in the supermarket industry the four strategic approaches can be analyzed and show ways to make growth in the business. Market penetration in the UK can help the company grow organically by building new stores or extending existent stores, or raise market shares by acquiring other businesses (e.g. Morrison acquiring Safeway). Market development can give access to new customers by expanding the market overseas, or the development of other means of selling such small convenience stores (e.g. Tesco Express). Product development can bring new choices to customers such as online retail and home delivery (e.g. Ocado). Diversification can bring more lines in the business such as the addition of clothing, electrical and other services (e.g. Sainsbury).
Porter’s Five Forces
Porter’s five forces help in analyzing and understanding the competition from external sources and the internal threats (Slack and Lewis, 2009).
The suppliers’ power is relatively low in the case of Morrison since they control their own supply chain and are mainly based on vertical integration. Besides that, the external suppliers are numerous and it is not a big issue for Morrison to switch suppliers.
The buyers’ power in this industry is always high and sensitive. It is easy for the buyers to switch mainly because the products in different supermarkets are very similar. Buyers are also sensitive to price and always seek for value. Products such as loyalty cards and promotions can also play a role in customers switching stores.
Rivalry in the industry is above medium, there are many competitors but on the other hand the industry can also be considered oligopolized since ‘the big four’ supermarkets hold 76.4% market share (Tesco 29.9%, Asda 17.5%, Sainsbury’s 16.7%, and Morrisons 12.3%) in January 2012 (BBC, 2012). Mainly the supermarket industry growth has become steady and little differences in product.
Threat of substitutes, when we are talking mainly about obtaining grocery, there are few substitutes, very few people buy or get their grocery from farms or other means beside the supermarkets. There is a population that would choose convenience stores at times, but then again, many of the convenience stores are now owned by the giant supermarkets such as the likes of Express Tesco.
Threat of new entrants can be considered low when it comes to new entrants due to huge capital requirements and economies of scale, the entry barriers are very difficult to sidestep, especially gaining market share and compete the ‘big fours’.

Marketing Strategies
Marketing Mix can be helpful in defining the choices and strategies the organization can take, the 4Ps (Product, Place, Price, & Promotion) can be used to evaluate the marketing strategy at Morrisons as a whole business using the available data (Kotler and Keller, 2006).
Product: with more than 27,000 lines at each store, Morrisons provide a wide range of products to the customer depending on store size and location, with some products meeting specific local tastes for e.g. regional beers (Williamson et al, 2004).
Place: until 2004, most of Morrisons stores were located at the north of England, after the acquisition of Safeway in 2004, Morrisons stores expanded all over England. Many of the stores were located nearby major roads (Williamson et al, 2004).
Price: according to researches by journals from Which? magazine in 1996, a conclusion came out that Morrisons had the lowest pricing in the UK supermarkets. With prices equal in all stores regardless of location, while other chains had different prices by location wise (Williamson et al, 2004).
Promotion: in 2007 Morrisons advertised using well known celebrities, but a new campaign emerged using children visiting farms and asking questions like the source of Morrisons’ fresh food. An another promotional step was changing the slogan “Fresh choice to you” to “Eat fresh. Pay less”, which promotes both freshness of product and value.

Operations Strategies
Morrisons are kind of implementing Just in Time strategy by force, since most of their products are food, and it is vital for Morrisons to keep their freshness. Inventory is in fact huge, but the waste is always minimized since all food deteriorates. In addition, Morrisons have their just in time production system in the store such as making in-store sandwiches, Market Street is a perfect example. As a result of waste reduction, Morrisons did reduce waste by 3105 tons in 2008 from the previous year (The Scottish Government, n.d).
To add on, Morrisons own most of its supply chain and base itself on a vertical integration which means most of the suppliers are Morrisons’ subsidiaries such as Holsa Ltd, Household Potatoes Ltd, and Farmers Boy Ltd. This can help in securing a continuous supply chain. Sales-Based Ordering (SBO) is an another process used in operations to process data of consumer demand on daily and weekly basis, and use the data in forecasting demand, which links with the supply chain and offers a much leaner operations management (Williamson et al, 2004).

In conclusion, the strategies conducted by Morrisons have proved its success along the time, and it effectiveness in competing with rivals. The market penetration and acquiring Safeway increased a whopping market share in the business which played a major role in achieving the corporate strategy, as well as the PFF analysis which helps understand the industry and where the business is at. Understanding the marketing mix and the operation strategies plays a role in keeping the three main values in steady development.

References:
BBC (2012) Tesco market share dips below 30% [Online] Available at: http://www.bbc.co.uk/news/business-16817254 (Accessed 16 July 2012)
Kotler, P. & Keller, K (2006) Marketing Management. 12th ed. Pearson Education
Slack, N. & Lewis, M. (2009). Operations Strategy. 2nd ed. Pearson.
The Scottish Government (n.d) consultation Paper on Potential Legislative Measures to implement Zero Waste
Responseto Discussion Paper - Wm Morrison Supermarkets plc [Online] Available at: http://www.scotland.gov.uk/Resource/Doc/274369/0082105.pdf (Accessed 17 July 2012)
Williamson, D., Jenkins, W., Cooke, P., & Moreton, K. (2004) Strategic Management and Business Analysis. 1st ed. Elsevier