Task 1 Part 2 – ASDA Stores Ltd.
Asda Stores Limited, widely referred to as Asda, is a British supermarket retailer owned by the American multinational retail corporation, Walmart. Asda is headquartered in Yorkshire and currently employs 165,000 people (Asda, 2018).
I chose Asda because I am intrigued by the emerging trends in the UK Food and Grocery market. Secondly, the British retail market is a multibillion pound business, valued at £184.5 billion according to the Institute of Grocery Distribution (2017). The sheer amount is significant and relevant because a business’ main aim is profit maximisation. Thirdly, Asda is in the business of selling consumer products that we all use daily. Therefore, the importance of supermarkets for our everyday needs cannot be overstated. Asda, by virtue of its standing as one of Britain’s “big four” supermarkets, was therefore a natural choice for me.
Asda is performing well to an extent. In the 2017 Financial Year, the company posted pre-tax profits of £791.7 million. However, this was a 19 percent decline from the previous year. Furthermore, sales declined by £700 million to £21.6 billion (Home Office, 2017). The company however reported that that they had 398,000 new shoppers. This increase in customer base, despite marginal market share decline, is promising because the UK Food and Grocery market is projected to grow by 15 percent between now and 2022 to £213 billion (IGD, 2017) TO £213 billion. With Asda’s increasing customer base, it is likely that they will create considerable value for its parent company, Walmart.
Asda should continue to register growth because it is showing an ability to adapt to the ever changing world. The company’s ability to evolve has shown in their sustainability activities. They have reduced energy consumption by approximately a third since 2005 (The Guardian, 2014). This reduces operational expenses and enhances the brand reputation, especially with countries putting emphasis on the effects of global warming.
The company has numerous strengths. They are renowned for robust management. As far as talent is concerned, they have a competitive advantage over their rivals as they are able to source talent easily from their parent company, Walmart (CI...