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Coles Strategy Analysis - Strategic Management Assignment Sample
  • 19

  • Course Code: GSBS6060
  • University: The University of Newcastle
  • Country: Australia

Cole's Strategy Analysis- Strategic Management Assignment 

Making a reputation for yourself in the corporate world is no easy task. It does necessitate a company to overcome numerous obstacles, as evidenced by the fascinating story of Coles Supermarket Australia. Throughout its first century, the company has undergone enormous transformations. This article goes into great detail on the alterations and new approaches. It also examines current and historical business and marketing tactics.

About Cole's

With around 2500 supermarkets and other stores across Australia, Coles is a large retailer. Every employee at Coles makes every effort to make people in Australia's lives happier, healthier, and better.

Coles History

Coles is Australia's first supermarket. G.J. Coles founded the first Coles store in Collingwood, Victoria's Smith Street, in 1914. Coles began as a general merchandise store, promising to provide customers with high-quality goods and services for less than a buck. As a result, the Coles store drew large consumers on the first day and generated a tidy profit in ten days.

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Additionally, as Coles continued to prosper, it began making charitable contributions to organizations like hospitals, nursing homes, and funds for the unemployed. Coles and its employees have been taught the principle of "serving society in the best way" from an early age.

As Coles' hold on the Australian market tightened over time, it began stocking a greater variety of new items. Coles, for example, began selling electronic appliances like toaster ovens and irons in 1946. Coles introduced their first line of cosmetics in 1948 as well. That's how the business grew to become Australia\'s biggest supermarket.
Moving on, the first Coles store in the Melbourne suburb of North Balwyn opened in 1960. By 1973, Coles supermarkets had established themselves in all of Australia's major cities. Light bulbs, veggies, and fruits were all readily available for purchase in these supermarkets. 

Then, in the 1980s, Coles supermarkets began to modernize. In 1982, it was the first retailer to put electronic scanners in their establishments. Customers received receipts for their purchases as a result of this. Coles entered the online business in June 1999 when internet technology became more widespread. Then, in 2007, Wesfarmers, a well-known and well-known Australian firm, bought Coles.

When Wes farmers owned Coles, the company made significant strides in animal welfare and responsible sourcing. Although the combination of Cole and Wesfarmers had lasted nearly ten years, Wesfarmers put out a plan to separate the two companies. It became a separate publicly traded business on November 15th, 2018, when Wesfarmers shareholders approved the demerger of Coles.

Coles Business Strategy Analysis

Coles has three strategic pillars that enable it to distinguish out in a highly competitive business market. It\'s about selling more innovative, inspiring customers, and working together to win. Each of these pillars is explained in-depth below.

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Intelligent Selling

Adopting modifications in response to global shifts is a critical component of smarter selling. It calls for both technological and non-technological adjustments. As part of Coles' strategy pillar of smart selling, the company has implemented cutting-edge technical solutions in its stores. It has, for example, embraced a hybrid cloud architecture. Coles has built technology-driven stores and supply networks with the support of such revolutions in Technology. Aside from that, Coles\' smart selling strategy includes strategic sourcing and an optimized network and format selections.

Customer Inspiration

Coles has this incredible corporate strategy to attract and loyalty. It works dedicatedly to give consumers the most excellent food and beverage solutions. In addition, it also provides its customers with the best value. This inspires them to buy Coles' items. Here are some examples of how Coles inspires its customers:

  • Customized offers of trustworthy and focused value.

  • Leading shopping everywhere and anytime.

  • Concentrate on client comfort and wellness.

Win Together

The power of collaboration is believed by Coles. The whole Group of Coles works together and wants to succeed with their teams, suppliers and communities. It, therefore, requires a series of measures to support its teams, suppliers and communities. Some of them have been given below:

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  • Ensuring the health and safety of employees.

  • Fostering employee engagement by creating a positive work environment.

  • Creating new ideas through successful collaborations.

Coles Internal and external analysis

(External Analysis)

  • Business Background

The Coles Group was established in 1914 and is still going strong today. Since then, the company has grown tremendously and is now one of Australia\'s biggest grocery chains. These stores, which serve as departmental and retail outlets, offer a wide range of goods and services to the Australian public. It employs around 107,000 people who work in a wide range of industries, from retail sales of consumer goods to the management of internet transactions.

The workers are well-trained to boost the company\'s output (coles.com.au, 2018). In 2017, the corporation generated revenue of roughly $970 million (news.com.au, 2017). In 2007, Wesfarmers purchased this business.

  • Business Industry

The retail industry in Australia is served by Coles supermarket, which sells food and groceries. In Australia, the grocery shop and supermarket industry are among the most fiercely competitive. The rapid expansion of discounters like Aldi has had a significant impact on the country's retail business. Aldi has attracted the attention of the majority of consumers and created competitiveness in the market because of substantial discounts on private label products.

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As a result, well-known retailers like Coles and Woolworths were compelled to lower their prices and increase the number of private-label products they offered. The profit margins across the industry have shrunk significantly as the giants have cut their profits and accepted lower margins to remain competitive. (Nicholls and Orsmond, 2015)

  • An Overview of The Surrounding Environment

Economic: Australia's economy is doing well; in 2017, the country's GDP was $1,379.55 trillion US dollars (statista.com, 2018).

According to the Strategic management assignment, consumers like to purchase on a tight budget, especially when it comes to discretionary items. As a result, many are switching to private label brands to save money. As a result, Coles should aim to boost the number of personal label products it offers to attract customers.

Sociocultural: The increased awareness of citizens in Australia about health and well-being is a prominent trend. The vast majority of people choose natural and organic items (business.nab.com.au, 2018). With so few companies offering organic items, Coles has a tremendous opportunity ahead of it. Additionally, it\'s projected that organic product sales will rise shortly.

Technological: This Strategic management assignment explains how Technology is a critical factor in a company\'s success. Australian Technology is cutting-edge, and companies like Coles can use this to better their bottom line. Using the internet, they can better communicate with their customers, and online buying allows them to do so at a more convenient time.

Political/legal: Coles' operations are influenced by political and legal factors. The government's free trade policy, for instance, aids the business in lowering its trade expenses. The federal government's new anti-competitive policy, on the other hand, prevents Coles from eliminating competitors from the country's retail industry.

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Demographic: Around 24.22 million people lived in Australia in 20016, according to a report by (Australias. guide, 2018). According to this, the population has grown by 1.4% during 2015.

For this reason, Coles has to enhance its business soon as its customer base grows exponentially. People from all around the world live in Australia. Because of this, the company must understand the population density of the region in which they operate. To grow their business, Coles has to open more outlets in major cities across the country. This will allow them to draw in more customers.

  • The Industry Environment

This Strategic management assignment examines the business environment to help Coles better understand the dangers and possibilities it faces in the current market (E. Dobbs, 2014).

Substitute Threat Level: High: Convenience stores, farmer's markets, speciality grocery stores, and others pose a significant challenge to Coles' market share. The evidence reveals that convenience stores have seen a growth in their product offerings, making them a direct competitor of supermarket chains like Coles. Farmer markets are viewed as a possible threat to Coles because they offer organic items and may lower Coles' organic food sales.

Rivalry amongst the current competitors: high: Many stores in Australia offer identical products at various costs. Thus the competition is mainly centred on pricing and is gradually rising. Discounters' growing popularity and developments in Technology have all contributed to a rise in retail competition.

Suppliers' negotiating power-moderate: The negotiating leverage of suppliers is moderate due to a large number of providers willing to offer Coles resources. Policy Coles also trades resources from other countries at a lower price because of free trade. They do, however, have some negotiating power due to the superior quality of the products given by only a few suppliers.

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New entrants' threat- Low:
 The Strategic management assignment also looks at the threat of new entrants, which is low because entering the retail sector would take a large amount of investment money. To compete with well-established retailers like Coles, the latest entrant will have to spend a significant amount of money on advertising.

  • Competition

(Is there a strategic group to consider? What kind of competition exists among the members of this Group? Do the relevant companies have the following capabilities? What are their tactics? What dangers do they represent?

Many strategic organizations such as Woolworths, Aldi, and others have an impact on Coles operation. Woolworths, for example, is a well-known Australian retailer that strives to provide high-quality services while also upgrading its private label to expand its market share. In addition, Aldi\'s success is mainly attributable to the company's discounts (Steenkamp, 2017).

In addition to these titans, Coles is threatened by prominent multinational marketers like Wal-Mart, who provide their services in Australia via online platforms. With these forms, you may get high-quality things for a low price, and you can even get free home delivery. The vast majority of customers are therefore drawn to their offerings. As a result, competition is escalating in the Australian retail industry, posing a danger to Coles.

  • Opportunities and Threats

 Coles Group faces the following opportunities and threats:

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  • Geographic expansion will help the company reach new economies and boost business.

  • Increase the effectiveness of your marketing efforts.

  • Boost your marketing efforts.


  • Price cuts as a result of increased competition have resulted in decreased profit revenues for the company.

  • Customers may be drawn to competitors because of the wide range of goods and services available.

  • Aldi, Woolworths, and other competitors pose a danger.

Part 2 (Internal Analysis and Proposal)

  • Tangible and intangible resources of the business

 Assets comprise fixed and current assets, such as land, buildings and machinery (Schriber and Löwstedt, 2015). Tangible resources encompass both of these types of investments. Coles Group's tangible assets include the following:Tangible Resources:

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Organizational: In terms of corporate assets, Coles has a very successful strategic planning process, robust control and evaluation system, a unique retail architecture, and a low inventory turnover method. These systems strengthen coles' operational activity.

Physical: Adding together the store's property and facilities create the store's physical appearance. For the most part, Coles stores are spacious (2,150 square meters or more) and attractively designed to draw customers. There will always be a Coles store near you because it is constantly expanding its store network throughout Australia. They strive to maintain their store technologically up to date to serve their customers better. To save customers' time, they offer self-checkout.

Intangible Resources: It's tough to quantify intangible assets because they don't have any physical components. Intangible assets include things like copyright, patents, franchises, and goodwill, to name just a few (Jardon and Molodchik, 2017).

Human Resource: To improve its human resource asset, the Coles Group follows a few concepts outlined in this Strategic management assignment. The human resource department look for highly qualified and motivated individuals to help the company grow and improve—these fantastic employee engagement tactics aid in keeping the company's highly skilled workforce on board. Existing employees contribute to enhance the business and provide training to the new joiner. Therefore this helps to reduce the cost of recruiting new employees.

Ingenuity and Creativity: New product development and creative idea generation are aided by the employees, resulting in increased business. Cutting pricing, giving online shopping options, and labelling nutrition information on the front of the package are examples of innovative solutions that help companies educate their customers and gain their loyalty. It's critical to come up with creative ideas to serve better and satisfy customers.

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  • Identification of Skills

Coles' effective distribution network is seen as a resource and capability when it comes to outbound and inbound logistics. Achieving cost savings across the entire logistic network necessitates the collection of both tangible and intangible resources, such as supplier relationships and technical skills. Because of the tremendous and specialized extent of technological capabilities involved, it's been found that copying items is extremely tough.Network of distribution: 

The Popularity of the Company's Products: Coles is a well-known brand in Australia. Satisfied customer experiences assist build positive brand perceptions. The firm's items are of exceptional quality, and they contribute to a better overall shopping experience for customers. Boosting the company's local brand recognition is made possible through their advertising effort.

Brand reputation: It is significant since it contributes to the distinction between the company and its competitors. This element is not uncommon since most companies attempt to improve customer happiness. Therefore reputation or branch image can't be considered a competitive edge.

Management Efficiency: Effective management helps Coles Group boost its efficiency and allows the company to improve its performance. All of the company personnel are well qualified and creative, who contribute to the quality of the product and support company growth. Workers ensure improved customer relationships to improve the company's consumer base.

  • A Review of Core Competencies

Distribution network: The distribution system passes the core competency test. To be effective in every position, you need a mix of technical, behavioral, and functional abilities. As a result, the supply chain will be better managed going forward. The workforce is well-trained, and cutting-edge technologies help to streamline the supply chain.

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Effective management: To ensure a successful management test, it is vital to check that the company works following current culture and climate change and can meet client expectations. For example, when new technologies have been implemented, management must install them and train all staff. 

  • Make a Recommendation for an Appropriate Information System Solution to Satisfy the Needs of the Chosen Firm.

Information technology solutions can improve coles Group's company performance. According to the survey findings, the organization should invest more in educating its employees to serve their customers better. The Coles Group can make use of cutting-edge Cloud computing technology to enhance its management processes. They should aim to improve their marketing options and use social networks to improve their approach and reach more customers, which will help them improve their business.

The company can implement a data warehouse and decision support technology in its DSS application. This is a well-liked retail trend (Fazal et al., 2017). A data warehouse is a collection of dispersed heterogeneous databases that give retailers uniform querying technology. Managers will be able to make better judgments, and the company's revenue will rise as a result.

  • Analyze the proposed system and make recommendation

Traditional invoicing systems used a single database-centric data model, making it difficult for decision analysis to meet all of the system's requirements on the database. Building a data warehouse is a complex procedure that requires knowledge of the facility's capacity in great detail. Analyzing data more quickly and accurately helps managers make better judgments (Su and Needamangala, 2017).

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This will provide the business with a significant competitive advantage. Business structures involve a lot of invoicing data. Thus companies with complicated systems can benefit from this Technology for decision analysis. It is recommended that the company try to make more advertising so that its income increases. This Technology improves its decision-making system to assist it in figuring out ways of improving its business performance and gaining competitive benefits.

SWOT Analysis of Coles


  • It has a significant proportion of the Australian market for food and liquors. It is possible because of the company's extensive history.

  • The enterprise implements the most effective marketing methods. It uses patriotic and consumer-centred slogans to keep the interests of its buyers in its services.

  • The corporation uses effective pricing tactics to attract many clients.

  • It performs a range of successful marketing programs that are designed to meet customers' interests.
    • Excellent service and delivery responsibilities for online and offline orders.

  • With 800 outlets, the corporation is present in numerous cities.


  • The corporation has a strategy of lower margins compared to its competitors.

  • Because of its tough talks with suppliers in Australia, the company has been negatively promoted. It damages the public's sentiments for the company.

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  • Corporation can have more influence over the supply chain. Profits can be generated at several levels by channelling production.

  • The business can grow geographically to increase profits.

  • Business can put more money into marketing and branding efforts to attract new clients.


  • Price cuts are being caused by increased competition in the supermarket industry. 

  • The rise in competition causes consumers to become disoriented. In the end, he is unable to tell whether the company is a better supplier of goods and services.


According to the assignment results, the external and internal business environments contribute to a knowledge of Coles Group's position in Australia. According to the external environment, the company is well-known in the Australian market, but it faces competition from other retailers and discounters. The development of Technology has affected the company's business, as more customers are inclined to shop online.

According to its internal investigation, its solid supply chain and brand image contribute to its success and long-term stability. As a result of stiffer competition, the company's market value is shrinking. To help managers make better decisions, it is suggested that the organization improve its marketing initiative and deploy Data warehouse technology. This strategic management assignment describes how the organization can obtain a competitive advantage over its rivals by implementing specific projects.


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