Essay Help Services

Woolworth’s Approaches to Business Analysis

Home Articles Woolworth’s Approaches to Business Analysis


In America, Frank Woolworths founded the first Woolworths store in the year 1879. The first store was closed after a year but with new ideas Frank Winfield Woolworth opened a new store in Lancaster, Pennsylvania.

The first branch was then established in the year 1909 in Liverpool 9. Various other outlets were opened across the high streets of UK soon after the First World War. The secret behind this accomplishment was an amazing value on offer i.e., all the goods being priced at either a sixpence or a penny. Over the decades, Woolworths became a part of the British national fabric. People started looking at it as an important part of the community and a pillar of reliability. For good reasons, the shutters of its American cousin was closed in the year 1997 but eventually it was fated to be successful.

Woolworth’s Mission Statement and Objectives

To be placed at the heart of the community and to become the most loved retailer for family leisure, kids, and home are the primary objectives of Woolworths.

Its stated aim was to enhance the stock turns and to optimize efficiency of networks. A huge amount of money was invested in the supply chain management system of the company.

Woolworth’s SWOT Analysis

The internal and external factors which affects the functioning and operations of the company are taken into account in the SWOT analysis.

SWOT refers to:

S- Strengths

W- Weaknesses

O- Opportunities

T- Threats


Strengths and weaknesses are company’s internal factors and opportunities and threats are company’s external factors.


Following are the strengths of Woolworths

  • In the entire market, it was one of the cheap retailers
  • It has the ability to minimize its cost and other expenses
  • Adaption of advertising icon
  • Strong presence in the market of confectionary, toys, house ware, and other seasonal products


Following are the weaknesses of Woolworths

  • The company extends the lengths of two or three offers
  • It failed to update its technology
  • During the serious trading time of Christmas, the company failed to take effective decisions
  • The perception about the company was that it offers poor quality goods at low prices.


Following are the opportunities for Woolworths

  • Expansion of electronic entertainment offerings
  • The prices of the products were less as compare to the competitors
  • Offers huge variety of seasonal and other products
  • Offers technological expansion.
  • Extends channels for customers


Following are some of the threats faced by Woolworths

  • The level of competition was very high not within the retail sector but also from other sectors like catalogue- based retailers, category killers, and discounters.
  • As the demand for oil and prices of oil increased, it was difficult for the company to make a competitive strategy related to the prices.
  • The other cause of concern is the establishment of convenience stores as it leads to reduction in retail sales.

Woolworth’s PEST Analysis

PEST refers to

P- Political factors

E- Economical factors

S- Sociological factors

T- Technological factors

All these factors play a vital role in the success and development of any business.

Following is an outline of PEST analysis of Woolworths:

Political Factors

The success of any business is directly affected by the political factors. It includes new rules and regulations, taxes, and other legislations.

Political factors that affected Woolworths are:

The retailers were given the ability to provide legal advice by way of their own law companies after the announcement of New White Paper.

A further service was provided by Dubbed Tesco Law to boost the approach of one stop shop of the large chains of super markets. The Woolworth’s primary source of competition were the chains of supermarkets which made a strategy of providing one- stop shop opportunity to all the consumers by introducing facilities like banking, insurance, pharmacies, etc.

Woolworth’s furnishings, DIY ranges, and house wares were also beneficially affected with the development of housing market as Gordon Brown announced a doubling a stamp duty on house purchases to £ 120000. This was primarily done to help the first time buyers.

Sociological Factors

The another important factor which has an impact on the success and growth of the business is sociological factor. The trends and demand of the customers tend to change with time as they always get attracted towards new designs and fashions. They are of the viewpoint that low prices mean low quality. That is why, they prefer quality over prices. Fashionable and most attractive products are being offered by Woolworths to the consumers over the years.

Economic Factors

Due to economic recession, Woolworths has closed all its establishments in UK which signifies that the success of any business depends on the economic situation of the country. The functioning and development of Woolworths has been severely affected by credit crunch because of which it could not afford to continue its operations. As a result, Woolworths lost its goodwill and closed down all its operations in UK.

Technological Factors

In the modern world, there is a boost in the advancement of technology. Day by day all, companies come forwards with new ideas and innovations. Over a long period of time, Woolworths has been using outdated ideas and it was only a couple of years ago that it realized the significance of technology. Hence, it brought new ideas into the business so that it can compete with all the competitors and survive in the market.

Competition and Formulation of Strategies

Woolworths have some exclusive rights for a group of its various in- store brands like Gloss, Chad valley, and Ladybird. The brand Ladybird tailors for the clothing market of children aged between 0-9 years. The brand Gloss caters the consumers of Ladybird as they become older by offering fashionable clothes at a low price to the females aged between 7-11 years. Chad Valley is a developed range of toys which was established in the year 1991.

Woolworths was not able to lessen the competition from category killers, specialists, and discounters. The reason being there was a shortage of competencies and understanding of the markets and hence, it was not able to challenge them. However, by using some historic competencies and adapting some price, product and promotional strategies, Woolworths was able to possess numerous core competencies.

Various product, price, and growth strategies were adopted by Woolworths. It started using low price strategy. Another factor which leads to the success of Woolworths was its channels of distribution. It has one of the biggest chain distributors in the UK.

In order to promote its business, it started using various promotional tools effectively and offered extensive range of goods in the store. Unfortunately, in February 2009, it shut down its operations in UK and also closed 807 outlets in the high streets of UK. Though it is no more a rival but has given a tough time to all its competitors.

Control and Execution

For every company, control and execution of various marketing strategies is imperative. If a company is able to implement a strategy cautiously and receives a proper feedback, then it can lead to the growth and development and can generate expected cash flow for the company.

Over many decades, Woolworths have been utilizing control and execution effectively. But, its strategies failed and the prices of the shares dropped all of a sudden that lead to closing of its stores in the UK.

Search Here

Order Now

Latest Reviews


Payments And Security