SWOT Analysis of ASDA | The most Trusted Retailer in the UK

by Shamsul
SWOT Analysis of ASDA
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SWOT Analysis of ASDA | Online Food Shopping

ASDA is a popular chain stores supermarket company in the UK. It was founded by Fred Asquith, Sir Noel Stockdale, and Peter in 1949. It is headquartered in Leeds, UK. In 1999, supermarket giant Walmart acquired the brand for 6.7 billion pounds. From 2003 to 2014, ASDA remained the top chain brand in the UK. Recently in 2021, Issa Brothers and TDR capital purchased ASDA. Let’s see the SWOT analysis of ASDA.

The annual net sale of ASDA in 2021 was 3158.9 million dollars. They have employed more than 165000 employees to date to run their global operations smoothly. The chain stores supermarket sector is highly crowded with many big players. This means ASDA has got some tough competition from Amazon, Boots, Debenhams, ALDI, Morrisons, Walmart, Waitrose, Tesco, and Sainbury’s. Right now, we are analyzing the SWOT analysis of ASDA which primarily focuses on its internal factors such as strengths and weaknesses as well as external factors such as opportunities and threats.

SWOT Analysis of ASDA

 

Company Name: ASDA Stores Limited

Founders: Noel Stockdale, J.W. Hindell

Founded: February 19, 1949, Leeds, United Kingdom

Headquarters: Leeds, United Kingdom

Parent Company: EG Group

CEO: Roger Burnley (Jan 1, 2018-)

Type: Retail Industry

Sector: Lifestyle and Retail

Tagline: Saving Your Money Every Day

Unique Selling Proposition:  The company is connected with its users via different media channels to offer services.

Customers: People looking for daily need products and groceries

Target Consumers: The majority of married living people and internet savvy customers

Revenue: Operating Profit to £693.1m (2021)

Strengths of ASDA | SWOT Analysis of ASDA

Recognition and Awards:

The company has grabbed several accolades and awards for its amazing services. Awards like Drink Retailer of the Year (2019), Oracle Retail Week Award for Innovative Employer of the Year (2009), and more have been won by ASDA. It has also won the Chilled Retailer of the Year and Bakery retailer of the Year award.

Online Platform:

The company has a huge base of loyal customers. They are connected with the brand through social media, websites, and other online platforms. ASDA also connects with these people through these platforms for reviews and feedback. As a result, ASDA gets a chance to improve its service and offers.

Distribution Network:

In the UK, the chain store supermarket company has got 25 distribution networks. It holds the inventory of clothing, food items, ambient products, cereals, soft drinks, and more. They have collaborated with ToYou Parcel Services to parcel products.

Market Reach:

With a network of 630 stores and 14.4% market share in the UK market, ASDA has a robust market presence. The company only hires professional and experienced workers to run its operations smoothly. The brand has successfully built the most reputable company in the UK.

Strong Product Portfolio:

The brand provides a huge variety of products to market and stores because of its strong product line. They supply products to hairdressers, pharmacies, petrol and gas stations, cafes, dry cleaners, and so on. On the other hand, their prices are very affordable and easily attract customers.

Marketing and Advertising:

The company also provides the item of the world’s leading brands to the users along with its own branded products. To connect and target every customer, they have launched several promotional and marketing campaigns.

Loyal Fan Base:

The major strength of ASDA is its loyal customers. They have a very huge database of customers. More than 19 million people visit ASDA stores weekly. Its online website serves 98 percent of the UK’s home products. Its stores are based on different formats like Superstores, Supercenters, ASDA Living, Petrol Filling Station, and George Stores.

 

Weaknesses of ASDA | SWOT Analysis of ASDA

  • Controversies:

In 2017, the company was involved in a price-fixing scandal of dairy items. The overall cost was more than 270 million pounds. Such incidents are not good for the image of the company. They received so much criticism over this controversy. There was another controversy about selling horse meat.

  • Debt:

In 2021, the company had a debt of 3.5 billion pounds. This was enough to put the whole brand in jeopardy. They had to liquidate their assets in order to pay off debts. It shows the weaknesses of the supermarket brand.

  • Issues of Market Position:

As compared to its competitors like Waitrose and Sainsbury’s, ASDA’s products are not so good. They do not offer attractive discount offers like Aldi and Lidl. That’s why the company is still struggling to manage its market position.

Opportunities for ASDA:

  • Acquisition and Merger:

The company has a long history of acquisitions and mergers. First Walmart acquired the brand in 1999 and then TDR capital bought it in 2021. Just like this, the company should make some major mergers and acquisitions. It would permit the brand to expand its international reach and market share.

  • E-commerce:

Online shopping trends are gradually rising in the United Kingdom and other countries, especially after the pandemic. The brand has already a strong online store. It is imperative for the company to exploit new opportunities by introducing catchy promotional and marketing campaigns to increase its profitability and sales.

  • Worldwide Expansion:

ASDA should focus on expanding its business in other developing countries or markets across the globe. This kind of expansion could be beneficial for the company’s market growth, market share, influence, image, and profitability.

 

Threats to ASDA | SWOT Analysis of ASDA

  • Online Stores:

The presence of an online store offers both challenges and opportunities. It allows expanding reach and sales but you have to face tough competition from giants who have a strong online presence. So, it carries some threats too.

  • Strong Competitors:

There are so many competitors of ASDA in the market such as Lidl, Tesco, Waitrose, Co-op, Morrisons, and Aldi. They are giving tough competition to the brand in different sectors. They are disturbing each other’s profitability by offering excellent service. These are the biggest threat to each other.

 

Final Thoughts | SWOT Analysis of ASDA

After this comprehensive study of ASDA, we have concluded that ASDA is a leading chain supermarket company. They should work on their weaknesses and strengths in order to avoid threats and exploit opportunities. There are some areas that need some improvement like marketing and advertising, online presence, and global reach.

 
 

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