Case Study: Sainsbury plc

I'm supposed to do the Q3 ^^

The question is : Assess the extent to which Sainsbury's plan for 2007-10 is likely to enable it to meet its corporate objectives.

Here's the plan for 2007-10

• Space growth--10% new space by March 2010.
• Development of grocery and non-food ranges.
• Costs--cost savings of 155 million pounds in 2007/2008, thereafter ongoing cot savings to offset half our operating cost inflation.
• Channel growth through online and convenience expansion.
• Profit--profit growth flowing through at a percentage rate in high single digits.
• Sales growth--total additional sales of 3.5 billion by March 2010.
• Cash flow neutral over 3 years.

I think the corporate objective of 10% new space by March 2010 is likely to be met. First of all, the company must do a lot of marketing researches and analyse the data they've got after researching. They have to evaluate the place where they decide to open the new stores, including the population and accessibility, because these are very important factors which affect the number of customers straightly to a supermarket. Also, the situation of competitors are virtual to Sainsbury plc, they can't open a new store which too near the Tesco. And the company has to consider whether the staff think much of new store or not as well, that to motivate staff because staff are a part of this project. After marketing research, Sainsbury plc should set a complete and correct, proper and effective marketing strategy to make the space growth successfully, such as the way of advising their new stores.

However, 10% new stores is a big number and it is tough to achieve in only three years, that means a big number of cost and it may causes further problems for Sainsbury plc such as the cash flow problem and etc. Also, after opening the new stores, Sainsbury will have a range of troubles to solve like if some new stores can't get enough profit as they expected.

In summarise, I think it is possible to have 10% new space in three years by Sainsbury plc, although this is hard to achieve this goal, but Sainsbury has good reputation and popularity, also, their profit was doubles from 2005 to 2007, they have the ability to make the goal achievable.