Conduct a SWOT analysis for Loblaw. Assess the Company against the strengths, weaknesses, threats, and opportunities contained in the SWOT matrix.
Loblaw Companies Ltd, the Canadian food retailing sector, had been growing at less than 1 percent a year, and in 2012 it was a $86 billion business. Several competitors in this sector include Sobeys, Metro, Costco Canada, Canada Safeway, and Walmart Canada. Loblaw Companies is Canada’s largest food distributor with sales of more than $32 billion, 1000 stores, and 136 000 employees. The organisational objectives were to control costs through efficiencies and differentiate its products (through private-label brands such as President’s Choice, No Name, Organics PC, and Joe Fresh) and its stores (through 22 different brand banners such as Loblaw, Fortinos, No Frills, Provigo, Zehrs, Wholesale Club, and Atlantic Superstore). In 2009, it acquired T&T, the largest Asian foods chain, to capitalise on the growing ethnic food market. Then in 2013, it acquired Shoppers Drug Mart. In 2016, Amazon purchased Whole Foods and threatened to disrupt the grocery business. Loblaws initiated a “click and collect” on fresh grocery orders to compete. At the same time, governments are increasing the minimum wage, increasing labour costs by $190 million annually.
The largest threat to Loblaw’s strategy is Walmart, the world’s largest retailer. The latter has a growth strategy, opening hundreds of stores every year. Walmart arrived in Canada in 1994 by acquiring 122 Woolco stores. Walmart not only used size and scale to compete (as did other retailers) but also mastered the use of technology to drive costs down. For example, its centralised information system tracked the operations of 5000 stores worldwide and linked them with about 30 000 suppliers, all in real-time.
Conduct a SWOT analysis for Loblaw. Assess the Company against the strengths, weaknesses, threats, and opportunities contained in the SWOT matrix.
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