Coles Group Limited SWOT & PESTLE Analysis
COMPANY PROFILE -Coles Group Limited
Business Sector :Retail
Operating Geography :Australia
About Coles Group Limited :
Founded in 1914 by George Coles, Coles has grown large to be one of the largest Australian supermarket chains. The company’s headquarters are located in Hawthorn East, Victoria, Australia. It operates mostly in the form of retail and departmental stores helping Australians buy products which are even cheaper than 2009 prices. The company was listed as a public company on the Australian Stock Exchange as an independent company in 2018. It was earlier owned by the conglomerate Wesfarmers. The company includes the subdivisions of Coles Supermarkets, Coles Online, Coles Express, Coles' liquor division and Coles' financial division. The current business of the company is thus diversified; starting from retail products of food and liquor on one hand to online selling of products and services like insurances on the other. In 2020, the company was voted amongst the “Top 30 food retail stores worldwide to visit in 2020”The mission statement of Coles is to fulfill 'The Coles way', which aims “To give the people of Australia a shop they trust, delivering quality, service and value.” The Coles vision is to 'become the most trusted retailer in Australia and grow long-term shareholder value'. It has a workforce of more than 112,298 team members as of early 2019.
Coles Group Limited Revenue :
A$38.175 billion – FY ending June 2019Ownership / Major shareholders :
Coles is a division of the Australian Company Wesfarmers, which was formed after the Coles Group was acquired by the company in the year 2007. The division started functioning in November of the same year. Wesfarmers bought the company for $19.3 billion, known to be one of Australia’s biggest takeovers in the corporate sector.Competitive Analysis of Coles Group Limited
| Strengths | Weaknesses |
| 1. Second largest player in the Grocery sector of Australia and control 24% market share in the retail market for petrol. 2. Cost Saving products and services 3. Consumables sold in Coles departmental and convenient stores are indigenous in nature. 4. Sustainability and environmental friendly business outlook with effective CSR | 1. Persistent problems from the suppliers. 2. Management problems. |
| Opportunities | Threats |
| 1. Private label strategy 2. Growth opportunity in the national liquor market. 3. Insurance and finance sector opportunities to pull upon. 4. New market scanning. | 1. Legal and political regulations 2. Competitor threats in the established sector 3. Competitor threats in the evolving sectors. 4. Threat of identification of Coles as a brand 5. Change in food spending habits of Australians |
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Detailed SWOT Analysis of Coles Group Limited
Strength
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Weakness
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Opportunity
1. Private Label Strategy: Apart from the grocery sales the company is trying to make direct dollars from its consumers by selling private label goods to its customers. According to 2012 IBIS World Report, goods which are private label will contribute 33% of all sales in the supermarkets by 2018 an increase of approximately than 150% of what it was in 2008.
2. Growth opportunity in the National Liquor market: With Woolworths & Woolies controlling most of the liquor outlets, Wesfarmers which is the parent company of Coles control 20% of the National Liquor market. Huge opportunity lies for Coles to enter into more of private label liquor brands to capture more market share.
3. Insurance & Finance Sector opportunities to pull upon: With the presence of a huge database readily available through the retail and convenience stores Coles along with its competitors are trying to leverage the data and come up with customized insurance policies for the customers based on their standard of living which is again being estimated from the pattern of their purchase history. With the advance of data analytics this can be a huge opportunity for Coles to cater to its huge customer base with tailor-made insurance products that can be modified or customized or up/downscaled as per their needs. Coles have been issuing its own credit cards from 2010 which were almost 400,000 in number. But in mid-2014 it announced of its joint venture with GE Capital to sanction the customers for using wider range of products in the category of loans and advances.
4. New market scanning: Big retail players like Coles and Wesfarmers (Parent company of Coles) have already placed some of their researchers in actions to find the ripe grounds for expansion in some of the emerging sectors in Asia where they can leverage their sourcing & supply chain expertise to tap the markets.
Threat
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Major Brands :
Coles as a retail supermarket and online store has come up with its own brand of consumer products, such as:- Coles Gluten Free Range
- Coles baby products
- Coles bakery
- Coles Dairy
- Coles Deli
- Coles fruits and vegetables
- Coles mobile services
- Coles meat
- Coles financial services
- Spirit Hotels ( Coles digital services)
- Coles express (Australian chain of convenience stores )
- Colesflybuys
- First Choice Liquor
- Liquorland
- Coles liquor
- Vintage Cellars
Key Business Segments / Diversification :
Recent Acquisition / Mergers / Alliance / Joint Ventures / Divestitures :
Open Table Preview| Supabarn Stores | Supermarkets | 2016 | Acquisition | Acquisition of 5 Superbarn stores would strengthen Coles presence in Canberra region |
| flybuys | Loyalty Program | 2011 | Acquisition | Acquisition of NAB’s 50% stake in Australia's largest loyalty program, gave Coles 100% ownership. |
| Talbot Hotel Group | Liquor | 2006 | Acquisition | Acquisition of Queensland-based Talbot Hotel Group to support Coles rollout of big-box bottle shops in the state |
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References used in Coles Group Limited Analysis Report
1. Coles Annual Report 2019 - https://www.colesgroup.com.au/FormBuilder/_Resource/_module/ir5sKeTxxEOndzdh00hWJw/file/Coles_Annual_Report_2019.pdf
2. Coles Annual Report 2018 - http://aj.nowjob.it/coles-group-annual-report-2018.html
3. 'Not happy Coles': Supermarket cops backlash over catalogue decision: https://au.news.yahoo.com/coles-backlash-over-catalogue-decision-031808207.html
4. Coles launches new range of mini collectables - https://7news.com.au/lifestyle/food/coles-launches-new-range-of-mini-collectables-c-1193909
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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Coles Group Limited SWOT and PESTLE analysis has been conducted by Swayambhu Dutta and reviewed by senior analysts from Barakaat Consulting.
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