Strategy for organizations - Essay Example

These retail stores can be called convenience stores, supermarkets, superstores etc. These retail outlets are often part of large multiple chains and they have their shops all over the country. In UK such stores are quite successful. People trust their brands and prefer them to other brands. Sainsbury's is a symbolic name in British retail market. There are various reasons that make it great, its strong brands, passion for food, its history of innovation and a trusted moral approach to business.

All these things make it the household name of UK. J Sainsburys plc operates multiple types of businesses. Their operations range from Sainsbury's supermarkets, convenience stores, a home shopping service and Sainsbury's Bank. In this paper the external and internal environment, strengths and weaknesses of this great company will by analyzed by employing various models and techniques. Various models and techniques are used for analyzing the external environment of any organization. PESTEL model will be used here for analyzing external factor affecting the performance of the company.

PESTEL is actually abbreviation of Political, Economic, Social, Technological, Environmental and Legal factor analysis. By analyzing all these very important external factors that affect the performance of any organization a clear picture can be obtained for evolving correct and effective strategy. This analysis gives an outline of the different factors that the company has to take into consideration. For a comprehensive PESTEL analysis it is important to consider some minor sub factors that are dominant factors for a particular industry.

These dominant factors for a company like Sainsbury's plc are market size, scope of competitive rivalry, market growth rate, number of rivals and their relative sizes, etc. Knowledge of these external factors is important because of the implications they have for the evolving effective strategy.Sainsbury's plc is one of the largest and trusted name in Britain. It has extensive chain of stores all over the country and according to recent reports the company gets more than 10% of market share. There are some other big names like Morrisons, Safeway and Asda.

These are Britain's best-known companies and Sainsbury's has to compete with them in the expanding supermarket of Britain. The company was under pressure for last few years and even suffered the first loss in its 135-year history. Some of the main causes of weaker performances are given below.Political and Economic factorsGlobalization had great impact on its performance. Global companies like Wal-Mart entered the British Market and affected the sales of company. Sainsbury's offers over 30,000 products in its supermarkets; about 50% of them are their own brands.

Because of poor economic policies it was difficult for them to maintain quality and price parity favorably.Oversees losses as in Egypt also affected their overall performance.Social, Technological, Environmental and Legal factorsThere was lack of appeal to customers in comparison to other competitors. The