Analysis of the Industry of Wellcome Supermarket

Wellcome Supermarket
Student's Name
Institutional Affiliation
Professor's Name
Course Code
Date
Wellcome Supermarket
a.
The Wellcome Supermarket in Hong Kong belongs to the retail industry. The supermarket was the first retail store to establish operations in Taiwan in 1987 hence benefiting from the first-move advantages like seizing the strategic store locations (Link, 2021). The supermarket offers fast-moving consumer goods and products, including soda, milk, toilet paper, and over-the-counter drugs. The supermarket adopts a cost-leadership business-level strategy (Nunan et al., 2020.) Cost-leadership entails adjusting the company's prices and offers discounts depending on the profit targets for the company and the plausibility of achieving such profits. Cost-leadership is a great business-level strategy because it provides the supermarket with the leeway to adjust every cost component towards achieving its core objective of profit-maximization and minimization of costs. The supermarket applies cost-leadership in its pricing, whereby the product prices are increased or reduced to achieve cost leadership in the retail industry (Ou, 2021). Discounts are given to the customers to achieve cost-leadership, given that discounts attract more sales hence high revenue for the supermarket that sets off costs.
By and large, the cost-leadership strategy is an excellent business-level strategy for Welcome supermarket. The corporate level strategy adopted by the supermarket is the combination strategy that incorporates the growth, stability, retrenchment, and expansion corporate strategies subject to its objectives (Link, 2021). The company adopts the corporate strategy because the retail industry is a dynamic industry that requires players' responsiveness. The supermarket must grow, retrench workers, expand and stabilize, given that it is a profit-oriented business (Sun et al., 2009). Therefore, Wellcome supermarket has organized its operations into express stores, ordinary supermarkets, and supermarkets. In this case, the company has adopted the corporate expansion strategy, given that such categories of service delivery address various customer segments. For instance, the express stores were recently established; hence it is a response to the emerging needs of a segment of the clientele.
Wellcome Supermarket proves that it is responsive to emerging customer needs. The express stores are mini-supermarket operating 24/7; hence the supermarket manages to cover customers (Link, 2021). The supermarket's category of operations is the ordinary supermarkets. The latter offers essential goods like food and grocery to the customers. On the other hand, the supermarket category of Wellcome is a combination of a giant supermarket and a wet market. The latter provides foods like fresh fish, meat, and vegetables as well. The company has ensured the growth of the express stores hence the adoption of the growth corporate-level strategy. Additionally, Wellcome restructured its operations to develop three channels of product and service delivery, hence adopting the retrenchment corporate-level strategy (Sun, Kay & Chew, 2009). The supermarket has managed to weather the turbulence of stiff competition in the retail industry by adopting the turnaround strategy.
b.
The Bargaining Power of Buyer
The bargaining power of buyers is strong. The bargaining power of buyers refers to the power of the buyer to compel the Wellcome supermarket to offer quality products at low prices. Porter's Five Forces Model is applicable in Wellcome Supermarket. In this regard, the bargaining power of the consumers is one of the powerful forces for the supermarket, and it is high. For example, the fast-moving consum...