SWOT & PEST Analysis of Sainsbury

SWOT analysis of Sainsbury

SWOT analysis plays an important role in formulation a new strategy for the organisation by evaluating the strength and weakness present in the internal environmental as well as the opportunities and the threats present in external environment. SWOT analysis of Sainsbury is as follows:

Strength: Strength shows the asset of organisation present in its internal environment. The strengths of Sainsbury are following:

•  Ranked on the third place in UK.
  
• Has a well trained staff to handle the customers
  
• Has a great impact of advertising and branding in the mind of customer.
  
• Always provide the different range of products to the customer
  
• Successful to gain customer loyalty
  
• A great networking.
  

Weakness: Weakness shows the liability present in the internal market. The weakness of Sainsbury is as follows:

• Most of the Sainsbury stores are limited to UK only.
  
• High price
  
• Reluctant to enter in new industry
  

Opportunity: Opportunity shows the new area where the organisation can grow. These are as follows:

• Can expand their market in the whole world
  
• Can provide a different range of the product through segmentation technique.
  
• Joint venture to enter in new market
  
• Rapid supply of material and products.
  
• Presence of new technologies into the market
  

Threat: threats shows negative sides present in the external environment. Threats of Sainsbury are:

• Presence of the good competitors like Tesco plc
  
• An introduction of the new product into the market always gains the profits but in the term of supermarket industry, it is very hard to gain the profit on new product.
  
•  The economy of Sainsbury is not so good.

PEST analysis of Sainsbury

For the formulation of the new strategy the top management of the organisation has to take an overview on the external environment of the Sainsbury and examine political technological cultural and social factor. With the help of PEST analysis the top management of Sainsbury scanned the external environment and take the decision on the strategies.

Following are the factors which helped Sainsbury to make decision:

Political factors: The most of the Sainsbury stores are located in UK this is because the political factors of UK are very favourable to Sainsbury. The corporate tax in UK is very low in comparison to other country. Because of this the Sainsbury can save a huge amount of money as a profit. Political factors vary time to time in UK. Although political factors are not favourable then it gains the profit by providing the great products to the customers at low price then competitors.

Economic factors: In the supermarket industry, the economic factor plays a very important role. The success of the Sainsbury is depending on the two factor of economical environment that are the unemployment or inflation and the increment in the price of product. At the time of inflation and increment in the price of product the demand of the product decreases which cause the less production of the food product and affect the supply of fuel material.

Social factors: The social factors directly impact on the mind of customer. The customer always follows the brand and the always look for a product which is easily available in the market. Sainsbury works on this theme to make available the product to the customer at any time and also works on the “Cook and Save” where the customer can get the wide range of easy to cook products. Sainsbury also arranges the social activity time by time and conduct quiz and sponsors the program. This shows that the Sainsbury knows its responsibility towards the society.