WOOLWORTHS AND COLES

Who will win in the battle between Coles and Woolworths? Why?

Who will win in the battle between Coles and Woolworths? Why?

Introduction

The structure of the Australian food industry is highly concentrated: the two main chains (Woolworths and Coles) mainly hold most of the share of the business market. This shows the concentration of the supermarkets in the Australian market, therefore, in this paper, the author tried to present the information about both the chains and their market share, however, at last, the author tried to present the evidence about the ultimate market leader of the Australian food market. Last year, Woolworth was seen to own an approximate 840 supermarkets where as Coles owned 741; both a truly staggering number (Keith, 2012).

Woolworths

It is the principal distributor of the food and alcoholic beverages and holds a market share of 40%. It is part of a diverse group - Woolworths Ltd - which includes supermarkets (Woolworths, Safeway - gradually remarked that Woolworths - Food For Less, Flemings), department stores (bigw - various products at affordable prices discounted, Dick Smiths - shops specializing in electronic components), stores specialties' (Thomas Duck), which magazine (Australian Good Taste), liquor store (BWS, Dan Murphy's) and a chain of petrol stations (Caltex Woolworths / Safeway). The turnover of Woolworths in the food sector, in 2008 is $ AUD. 42.3 billion and the company employs more than 175,000 people in the same field. Reflecting the concentration of the Australian population in the area, Woolworth owns approximately 80% of all outlets on the East side of the Australian continent (Datamonitor Plc., 2009, pp. 44-50).

NET profit in 2003 and 'was $ Aus 609.9 million compared to 2002, which had made profits of $ Aus 523.9mil. Woolworth controls (2002) directly in about 950 stores, including 694 hypermarkets (80% of sales), 150 centres specialized in consumer electronics (7% of sales) 105 and department stores (10% of sales). Woolworth has often considered on making a move towards Coles assets, such has been the rivalry (Murdoch, 2007)Reflecting the concentration of Australian population in the area, Woolworth has 544 hypermarkets on the side east of the Australian mainland, about 80% of all outlets. Both Woolworths and Coles, in the last 12 months, have significantly increased their share of the market for the acquisition of independent distributors who, for the expansion assortment and for the reorganization of the sales point (WoolWorths, 2006, pp. 63-70).

Coles Supermarkets

It's the second supermarket chain by market share (35%) in Australia after Woolworths (40%). It has 694 stores nationwide and employs more 'than 93.000 people. In 2007 and 'was acquired by Wesfarmers one of the most' large Australian companies in which act aggressive diversification strategy through continuous acquisitions. The divisions of Wesfarmers include home improvement and office supply, coal and energy, Industry and safety, insurance and division of Coles (food, alcohol, convenience). The division operates through Cole's 2231 grocers, beverage alcoholic and convenience stores. These include Coles, Pick'n Pay Hypermarkets and BI-LO Supermarkets, Liquorland, Liquorland Express, Vintage Cellars, Coles Express and ...