Overview of Big W's Services

1. EXECUTIVE SUMMARY

The services offered by Big W have been explained along with the structure used by the company to manage its business. The market analysis of the retail sector in Australia has been provided along with the growth in recent years. The competitors of Big W was recognized and analyzed using Porter five force strategic frameworks. The macroeconomic forces affected the business of BigW along with its strengths, weakness, opportunities and threats. The strategic approach adopted by the company has been mentioned and how the approach worked on businesses and corporate levels along with the future approaches as expected by the organization. Big W has adopted the sustainable measures in order to stand committed towards management of wastes and environmental friendly sourcing of items. The company had always been looked into the welfare of their workforce and had tried to meet the needs and demands of their customers which had been continuously motivating them to aim for bigger objectives.

2. BACKGROUND

Big W has been chosen as the company for this project report as it has been performing quite well as a chain of departmental stores in Australia under the renowned Woolworths group. The company also features on the Australian Securities Exchange (ASX) for its decent performance in the market. The company values its customers and puts them first before anything else (Woolworthsgroup.com.au, 2020). The company has always been offering to its customers an extensive range of products at an affordable price range, which has been helping them to become a popular name in the retail industry within Australia.

2.1Scope

The current study is going to focus on why certain companies have a competitive advantage and perform well as compared to the other companies in the market. In order to carry out further analysis on this topic, Big W company has been chosen to assess its growth and progress keeping in mind the aspects of external forces that would be influencing the resources and capabilities of the company. Furthermore it would be seen how the chosen business and corporate level strategies facilitates in developing distinctive competencies which would be acting as sources of competitive advantage for Big W (as seen in Figure 1). In addition to this, the further exploration would reveal the process of enhancements that can improve the distinctive capabilities will also be considered in this report. The data that would be obtained as an output will give a detailed insight which in turn would help to improve the perceptual value of the different products and services offered by Big W to the consumers, and would henceforth give rise to superior profitability.

The report would look into the entire organizational framework and policies while elaborating on the strategies undertaken by Big W over a period of time. Moreover, the market analysis has been restrained within the scope of the Australian retail market.

3. BIGW GROUP

3.1 The Business

Big W has been one of the most loved brands in the Australian retail segment and has been a part of the Australian household for more than 40 years. The company has a strong and diverse network of about 183 stores spread across the whole of Australia (Woolworthsgroup.com.au, 2020). The most valuable asset of Big W happens to be its dedicated and passionate workforce of about 18000 people spread across Australia, Bangladesh and Hong Kong. Big W has been competitive in terms of pricing, improved their range of products and services and has been building convenient experience both on the online as well as offline platforms, and all this has been the highlighting aspects for the company in FY19 (Woolworthsgroup.com.au, 2020). The comparable sales in FY19 increased by 5.2% and in Q4 ity increased 7.2% with a growth recorded in all segments.

3.2 History

Big W has been a popular name in the retail industry in Australia and was founded in 1964 and started its operations at Jesmond, New South Wales. The retail chain slowly flourished from the original variety stores under Woolworth's company. Big W by the end of the year 1978 was able to open 13 discount stores across all five states of Australia (Woolworthsgroup.com.au, 2020). The separation between Big W and Woolworth was completed by 1989, even though few variety stores under Woolworth continued to operate in the 90’s The company has its present headquarters at Bella Vista, New South Wales. The present managing director of the company is David Walker. The company has always been driven by its commitment towards integrity and hard work.

3.3 Services

BigW is a renowned chain of the departmental stirrer in Australia and provides numerous services regarding the products. BigW considers it's customers as a family and wants to provide them with all the necessary products and services to make their day to day life easy (Bailey, 2017). Their products range from baby products which include apparels, toys and child care, numerous products for men and women. BigW has various options for home appliances, gadgets, beauty products and books. Along with all these, they also provide entertainment and recreation facilities which include services for organising parties, sports and tours. They even provide delivery options along with pickups, easy return policy and pay later options to their customers so that all are able to avail the services without any hesitation. BigW understands that people have a busy life and to help their busy life the company works in organizing reliable services.

3.4 Structure

BigW has been referring it's the structure of the business by online means and also encourages its partners to join in for benefits. The structure used by the company is B2B that can be recognised as business to business exchanges between two business entities (Ballantyne &Langcake2016). The benefits as achieved by the company are increased collaborations, efficient procurement, enhanced services along with improved supply chain management. The business is performed with the exchange of documents through technologies namely EDI and webforms. The technology used by BigW is web forms and has been introduced as free of the charge for all its partners. The webform provides the trade partners with opportunities for trading online, by empowering them with an alternative to the fax and emails, access to trace the transactions made along with increased and improved security for the business process. The other benefits as provided from the edit includes a reduction in manual intervention, duplication is prevented along with automation if the processes.

4. THE MARKET

4.1 Market Analysis

The Australian market has more than 14000 retail businesses, which account for 4.1 per cent of the country's GDP and employs around 10 per cent of the population there (Dabija, 2018). The retail industry in Australia is diversified in terms of business, region, reason, formats and it's competition with other sectors. The retail sales in the country have dropped over five years and the competitive challenges have increases subsequently owing to innovation that has led the entry of global retailers in the market. The Australian retailers have been lacking in the online progress which has posed a huge challenge for the retails in the market. According toInquiry report. (2020), the online retains account for 6 per cent of the total retail sales if the country of which 4 per cent is domestic and 2 per cent as overseas. Australia’s 90 per cent population reside in the urban areas of the countries that include the big cities, small cities and towns. The market of Australia has been recognized to have the second-highest wealth per adult compared to other countries. The retail sector has seen positive growth in 2019, despite the increments of wages and increased house debts. According to Australia retail sector (2019), the deep analysis if the retail sector if Australia has contributed towards certain market trends that includes

The foreign companies’ approach to enter the retail sector in Australia

Significantly growth recognised in the apparel and footwear market of retail

Considering the approaches of foreign companies in the retail sector the following were recognised

The future if the retail sector in Australia depends on the disruptive factors like the customer's expenses, investment by foreign companies that concentrate on growth

The retail sector requires skill and diversity in the delivery platforms in order to recognise the non-responsive retailers

The country's economy is driven by private investments so the overseas investments will provide opportunity.

Considering the growth recognised regarding the apparel and footwear, the following were recognised

The apparel and footwear market if the country showed growth of about 3 per cent from 2018 to 2019.

The major revenue was generated from women and girls apparel section

Online retails showed considerable growth as the demand increased for apparels and footwear.

4.2 External analysis - Macroeconomics forces

As stated by Jiang et al (2017) the macroeconomic forces can be referred to the influential, natural and geopolitical events of a region that impacts the economy of the concerned nation. The forces can lead to an impact on the whole population and provide the economic outputs, unemployment rate and inflation for the country. BigW as a retailer in the Australia market is subjected to the macroeconomic factors that impact the business. BigW provides a large section for baby products and toys that attracts new as well as existing customers. The retailer has been recognized to have a great shopping environment for an in-shop experience that provides the customers immediate help along with pickups and delivery options. The sales growth has been increasing annually for BigW which has boosted owing to inline shopping options. The company has been working to fulfil the needs of the customers by offering the best products and services. The employees are provided with all the required facilities and regular increments are assigned to keep the employees satisfied. Along with the positive points, some barriers are also recognized as the small sections for household appliances and women sections that lead the customer's ti to opt for other retailers. The sales history as recognised in the past few years indicated a weakness for the company as it led to the closure of about 30 stores across the country. The online shopping experience for BigW is impoverished when compared to global networks. The company has a lot to offer to its customers in order to attract them, as they provide high-quality products at reasonable prices. The prices are set according to the competitions in the market. The online platforms as created have led ti to increase the sale. The company has to work in training their employees on a regular basis to assure the best services. BigW along with the services it provides has to recognise the risks in the market. This increases online shopping options and the entry of new competitors in the sector. The competition has been increasing owing to the new entrants. The economic conditions of the country pose a threat to the business if BigW along with the market deterioration.

4.3 Competitor Analysis

According to Verma (2018), competitors form a significant element that provides a business, various ways to grow in the market. The main competitors recognised as by zoominfo.com (2020), are K-Mart, The Original Factory Shop, Bi-Mart, Giant Tiger, TJ Maxx, Home Bargains and Bealls. The greatest competition faced by BigW in arousal is from the Kmart. The competitor's table mentioned below provides a brief description of the companies.

The table has provided the required information about the competitors of BigW, and their weaknesses can be targeted in order to explore the markets and attract customers to BigW.

Considering the Porter five force framework, the competitors are analysed (Anastasiu, Gavriş & Maier2020). The K- Mart has a great competitive advantage owing to the products offered and locations stores. The original factory shops help in recognising the power of bargain customers, owing to the variety offered at cheap prices. The Bi-Mart can be recognised as an entrant, as along with the retail products, they offer pharmacy products that will lessen the consumer's labour. The home bargains and giant tigers can be observed as a substitute as they provide cheap groceries and load of varieties.

5. STRATEGIC APPROACHES

The complete analysis of the market condition, the country economy and the competitor analysis has led to the development of various strategic plans at business and corporate levels in order to provide advantage and growth to the business of BigW (Grimmer &Vorobjovas-Pinta2019).

5.1 Business level Strategy

BigW has been facing challenges in its sales growth for a long time, and it has shown positive results since 2018 (Alonso & Kok2018). The company's sales growth accelerated by 2 per cent in the last quarter of 2018. BigW had dropped the prices of around 4500 products, refreshed across 160 stores and opened a new store. The company had a reset of the products in order to satisfy the needs of its customers, which led to an increase of 25 per cent weekly. The purchased item increased by 3.5 per cent for every customer per cent resulted in a 1.4 per cent growth in transactions. The business strategy to lower the prices of products in order to maintain the competition helped the company to improve its sales and generate better revenue. The company also expects to lower the prices further in order to build momentum for the business.

5.2 Corporate level strategy

BigW lowered its price range, enhanced product variety as a business strategy. The company made a few modifications as a corporate strategy to improve business. The company worked on improving the store experience along with evolving digital offers. The organization also worked in taking the feedback and training the staff to understand the customer's requirements, which helped in developing a data-centric technique to enhance the communication (Alonso &Kok2018). The company also organised rewards for customers and employees and worked on ways to reach out to more consumers.

6. FUTURE STRATEGY of BIGW

BigW would have ample opportunities in the future in the Australian retail sector if it would take its strategic decisions wisely. The retail industry has been quite competitive keeping in mind about the changing dimensions of handling of business and demands and expectations of customers. According to the Mint berg’s model of strategic decision making, Big W can go for the planning mode where the company would systematically gather information of the retail market as per a given situation, then the company would look for feasible alternative strategies and lastly the company could rationally select the most optimum strategy that would help the company to gain competitive advantage (Bressan, 2018). In this way, the company would be able to look for new opportunities and also on the other hand would be able to resolve the existing problems.

According to the Porter’s generic strategies model, Big W would be able to achieve a better competitive advantage if it would concentrate more on the product differentiation and include more innovativeness in their product range (Islami et al. 2020). Again, the company could focus on more sustainable methods of carrying out business which would ensure more opportunities for Big W as compared to other companies in the Australian retail industry. Moreover, Big W would be able to have a competitive advantage by maintaining competitive pricing of their products and then slowly increasing their profit margins in order to have a better market share in the retail industry. Thus, in this manner Big W would be able to have cost leadership in accordance to the Porter’s generic strategies model.

7. Distinctive capabilities development

Big W is a company which has been continuously addressing the emerging issues in terms of the global trends that have been shaping the business through their innovative corporate social responsibility down the years. Big W continues to show their responsibility towards the environment by ensuring food and water supply security, management of wastes and water, and concern about the change in climatic pattern.

The company in order to show their commitments towards sustainability has even mapped their value chain along the goals of the United Nations 2030 Sustainable Development Programme, which would also ensure them to deliver values to their stakeholders. In terms of production and processing, Big W stands committed towards developing the best practices to ensure better lives for their workforce. Besides that they implemented the labour rights in the supply chain and stressed more on local sourcing. In terms of procurement, Big W has been focussing more on environmentally responsible sourcing and conducting independent suppliers’ surveys in order to improve their relationships with the suppliers (Wow2017cr.qreports.com.au, 2020). Big W in terms of operations stands committed towards zero wastage of food and reduction in energy consumption and emission. The company also wants to ensure that there are at least 40% female executives working for the company and there should be no salary gap between the employees based on gender. Moreover in order to develop their distinctive capabilities, Big W stands committed to look after the well-being of their employees and understand the needs of the customers and respond to them appropriately.

8. CONCLUSION

Big W has been a popular name in the Australian retail sector and has been delivering high quality products at cost-effective prices to the customers for a long period of time. The company has been continuously listening and learning from their employees as well as their customers, and this has been helping the company to bring about a change in their strategy. Big W has been following a more content-led strategy in order to take more advantage of the demand of the customers by demonstrating more effectively what the categories can offer to them. Big W has been banking more on the brand metrics like brand perception, brand awareness and brand preference in order to understand the buying patterns of the customers. The company has also been working on improving the digital strategy in order to provide a better website and search experience to the customers.