Steeple Analysis Of Uk Supermarket Commerce Essay

August 15, 2017 Commerce

The UK supermarket industry is the fastest turning sector of the UK economic system that has made a great part to its economic development. Presently, the supermarket industry employs more than 1.1 million people and contributes more than 8 % to the UK GDP ( Euromonitor International, 2010 ) . In every concern environment, macro analysis is of import to place the factors that can halter operations of administration ‘s advancement in the industry. STEEPLE ( Social, Technological, Environmental, Economic, Political, Legal and Ethical ) analysis is amongst the most effectual tools that are used to supervise alterations taking topographic point in the environment of the concern ( Brown, 2007 ; Griffith & A ; Harmgart, 2008 ) ; the analysis is done to place all of import factors that can hold a important impact on any administration operating in the UK supermarket industry.

Li ( 2008 ) and Vasquez-Nicholson ( 2011 ) emphasized that Morrison PLC is a dominant trade name in the UK supermarket industry as it derives its competitory border by making STEEPLE analysis often. It has successfully achieved its mark market size by working all strengths and availing chances present in its external environment.

STEEPLE Analysis of UK Supermarket

Every market is significantly impacted by both micro and macro environmental factors, but macro environmental factors have more influence on operational activities of a concern ( Jarett, 2012 ) . Each factor of STEEPLE analysis with its relation to the UK supermarket industry is discussed below:

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Social Analysis

The current tendencies of consumers in the UK market depict that they are traveling from one halt shopping to a majority purchasing manner as there are assorted societal alterations go oning in the state. Supermarkets have handiness of assorted non-food points which are normally on sale in the market. There have been demographic alterations because there is an addition in old people, the figure of female workers is increasing, and there is a important decrease in homemade repasts ( Davis and Relly, 2009 ) .

There is more accent on the private label portion of every concern mix, efficiency in supply concatenation, and betterments in operational activities so that the overall cost of concern is reduced. Most of the retail giants in UK are now switching to local providers for their purchases and stock demands ( Vasquez-Nicholson, 2011 ; Waterman, 2007 ) . In add-on, consumers ‘ demand of merchandises and services has changed because of their societal conditioning along with their beliefs and attitudes ( Lyan, 2007 ) .

Technological Analysis

Technological developments have enhanced the service degree of supermarkets in UK as they have benefitted both consumers and companies. With the aid of technological appliances, merchandises are available rapidly, personalized services are offered to clients and shopping has become convenient ( Akter, 2012 ) . The major systems that have enhanced UK supermarkets ‘ operation are Electronic Point of Sale, Efficient Consumer Response, Electronic scanners and Electronic Funds Transfer System ; these systems have assisted in efficient distribution and merchandizing activities so that demands of each company are efficaciously communicated on clip to the provider ( Grugulis, Bozkurt and Clegg, 2010 ) .

Environmental Analysis

All administrations have to demo that they engage in environment friendly activities ; there is increased force per unit area on assorted directors and companies for admiting their societal duty and they are required to act in a good manner for the society ( Smith, 2004 ) . In the UK supermarket industry, the chief issue at manus is that nutrient retail merchants have to show that they conduct their operations in ways that are good for the society as a whole and that is why every taking supermarket has taken enterprises to demo their Corporate Social Responsibility promise.

Even the UK authorities has launched a scheme for ingestion in a sustainable mode and made compulsory alterations in production methods to cut down waste, cut down resource ingestion that produces harmful gases or atoms which can do pollution, and minimise harm to the environment ( Trail, 2006 ) .

Economic Analysis

The chief factors to be studied in economic analysis are demands, costs, monetary values, net incomes, rising prices, unemployment, involvement rates and fluctuation in exchange rates along with assorted micro economic factors such as labour handiness, merchandise market, competitory construction and nature of competition. Sing the UK economic system ‘s public presentation in 2012, its GDP growing rate is 1 % , CPI rate is 2.2 % , unemployment rate is 7.9 % and the current balance of payments is account shortage of GBP 2.8 billion ( Trading Economicss, 2012 ) .

Micro Economic Analysis

Since international concerns of these supermarkets are turning, they are likely to acquire affected by decrease in the demand of UK nutrient market and there is an increased exposure to hazard of market concentration. There is huge force per unit area on bing companies to do certain that every factor is good studied so that all resources are efficaciously utilised.

The Merchandise Market

All supermarkets have been developed with supplying one stop purchasing installation and they have provided a broad scope of options to the clients. Nowadays, people are looking for healthy and alimentary nutrient so that they remain fit and healthy ; the demand of organic nutrients has increased and clients are looking for easy entree to these nutrient points. The supermarkets are now puting these nutrient points in their mercantile establishments to react to their client demands.

The Labour Market

As the figure of supermarkets is increasing in UK, there is a immense demand for work force that can supply services to clients with flawlessness. Since accomplishments required for executing necessary undertakings are of a lower degree, people with minimal instruction can easy happen a occupation in this market. The labour handiness is high as people have many occupations available in this field. Besides, the demand of merchandises is increasing, so supermarkets have added immense fluctuations in each class.

Competitive Structure

In UK, the supermarket industry is believed to be an oligopoly market, which is extremely competitory ; there are four chief houses in this industry, i.e. Tesco, Asda, Sainsbury and Morrison, which have more than 75 % of the overall market portion ( Jarett, 2012 ) . The pricing is about the same, so clients are able to purchase the merchandises they need within their low-cost scope.

Nature of Competition

The nature of competition is acquiring intensified: the figure of rivals is increasing because other companies are come ining this field, such as Waitrose, Marks & A ; Spencer and many more ( Seely, 2012 ) .

Political and Legal Analysis

The political parties in UK are taking aggressive stairss to protect the little stores and shops in the state so that their concern does non shut down ; they have imposed many limitations on the supermarkets so that a just and competitory environment is created in the food market industry. The Office of Fair Trading and the Competition Commission are the two chief organic structures that guarantee that supermarkets do non make monopoly and offer just monetary values to the clients.

Recently, the authorities has relaxed UK Sunday Trading Laws for benefits of the employees and introduced a new manner of nutrient labelling so that shoppers in the supermarket can do healthy picks. Since fleshiness is the primary issue in the UK population, there is a turning tendency of organic and healthy nutrient and assorted enterprises are being taken by the authorities to make consciousness of eating healthy and alimentary nutrient. The authorities has besides passed the Torahs for cut downing the use of individual bearer plastic bags so that the environment is protected from any sort of pollution.

Ethic Analysis

In the UK supermarket industry, each company has to guarantee that its concern operations are conducted in conformity with the ethical criterions. The sector is assumed by jurisprudence to be detecting ethical behavior and behavior concern patterns in conformity with corporate administration. Every administration has to guarantee that it conducts its patterns with unity, transparence, answerability and honestness ( Nicholls and Opal, 2005 ) .

Linkage of STEEPLE Analysis with Morrison PLC

STEEPLE analysis plays an of import function in placing all of import factors that are impacting Morrison PLC, but the most of import factors are societal, economic and legal 1s. The societal factors are of extreme importance because every company exists to function its clients ; it is of import to understand their changing tendencies so that merchandises and services are modified consequently. Likewise, analysis of economic factors gives an thought of economic status along with disbursement power of clients ; with the aid of these factors, it can make up one’s mind on its operational activities and farther enlargement programs. Since statute law is a compulsory portion of every concern environment, Morrison will hold to guarantee that it follows all regulations and ordinances to guarantee conformity with the legislative model ; in instance any regulation is broken, a heavy punishment will be charged, which can be dearly-won for the company. Hence, these three factors are the most of import countries of concern for Morrison PLC.

Importance of Human Resource Management in Supermarkets

HRM is an built-in portion of every concern administration, and it is of import for them to hold a extremely skilled and motivated work force that will help them in accomplishing their coveted ends and travel successfully in front in the industry ( Torrington, Hall and Taylor, 2008 ) . Following are the two illustrations of importance of HRM in the UK supermarket industry:


Tesco is among the largest supermarkets of UK that employs more than 326,000 people and has been gaining a consistent watercourse of gross in the last twosome of old ages ( Euromonitor International, 2010 ) . The company has done a competitory analysis to better the ways in which interaction is done with clients. In order to heighten its place in the supermarket industry of UK, it has used constructs of public assistance direction, uninterrupted betterment and Customer Relationship Management ( CRM ) along with good designed HRM schemes. The employees are treated as title-holders and are even rewarded for their extraordinary accomplishments ; they are involved in determination devising procedure every bit good.

All of these synergistic enterprises enhanced employee ‘s satisfaction degree, motive and productiveness along with credence to alter and hold high morale for work. In order to guarantee that Tesco provides a favorable working environment to its employees, it has decently implemented all of import Torahs that will guarantee employees are given their rights. For case, they are given competent compensation bundles, working environment is contributing, preventative steps are taken to supply healthy and a safe environment, and equal occupation chances and assorted other benefits are given ( Freeman, 2009 ) .

In order to guarantee that everyone is given the best employment chances, it is of import for Tesco to carry on market analysis on an on-going footing. It seeks aid from marketing bureaus that evaluate environment and guarantee that they design competent compensation bundles. By concentrating on efficient development of its work force, Tesco has been able to derive a competitory border in the market. The satisfaction studies of employees have shown that they are satisfied with their working environment and they will stay loyal to the company everlastingly. With the aid of a participative direction civilization, Tesco has been able to place its weak countries and has successfully made the needed alterations so that overall public presentation of the company improves ( Grugulis, Bozkurt and Clegg, 2010 ) .

Sainsbury ‘s

When Sainsbury ‘s noticed that its gross revenues were worsening and it was unable to accomplish its mark market portion, it decided to make its competitory analysis, which meant making both internal and external analysis. The chief job highlighted in the analysis was that it lacked a competent and loyal work force and there was misalignment between the administration scheme and the company ‘s overall scheme. There was a batch of miscommunication in the administration as employees had deficiency of lucidity about their occupations and how they were supposed to do part in the company. Overall, its HR section was non working swimmingly as the right work force was non employed at that clip ( Fox and Vorley 2004 ; Li, 2008 ) .

The first thing that was required was to alter the civilization of the administration and it was made possible by having top direction support. The codification of behavior along with HR policies and ordinances were distributed to employees so that they were cognizant of new regulations and ordinances that they had to stay by ; occupation descriptions were changed to fit demands of every place. Sainsbury ‘s even did a market study to place HR constructions of its rivals and besides compensation bundles that should be offered to employees.

After planning of HRM, it was implemented decently and monitored at little intervals to look into its advancement ; six months subsequently, Sainsbury ‘s observed an upward tendency in its gross revenues figures, along with an improved satisfaction degree of employees. The company made alterations in its enlisting and choice, preparation and developments, compensation and benefits and public presentation assessment processes so that everything in HRM was well-integrated.


In order to be competitory in today ‘s supermarket industry, companies have to do certain that they do analysis of their internal and external environments on an on-going footing so that they have the latest information about things that are go oning in their milieus. Although STEEPLE analysis is of import for placing the factors which have a inclination of act uponing the working environment of supermarkets, every bit of import are their work forces as they are the 1s who are in direct interaction with clients.

The chief factor impacting the supermarket industry of UK is the work force as it is of import for the supermarkets to use people who are well-skilled and efficient in assisting the companies in accomplishing their corporate aims. Since the figure of employees in this sector is increasing, there are more opportunities that the employment degree additions and passing power of people is enhanced. Another of import factor that needs to be addressed is the turning concern for a healthy life style and nutrient ; the consumers are now switching to organic nutrient. Therefore, the supermarkets have to guarantee that they have a specific scope of merchandises that are demanded by clients, so that they can guarantee that they maintain their place in the market.


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