More Related Content
Similar to Sainsbury in Egypt (20)
Sainsbury in Egypt
- 1. SAINSBURY IN EGYPT Amlan Das Rohit Agarwal Priyanka Agarwal Shikhar Bhatnagar Moumita Chowdhury Sakti Pada Purkayasta
- 2. Introduction • UK head quartered multinational corporation (MNC) • Leading UK and US food Retailer • Operated in financial services and real estate • Comprised of: Sainsbury supermarkets Sainsbury bank in the UK Shaw’s Supermarket and Star markets in the USA
- 3. Objectives • Mission “First For Food” • Objectives meet customer needs effectively • Provide shareholders with good sustainable returns • Offered 23000 products with 40% inhouse brand • Second largest market share in the UK retail super market(11.9%)
- 4. International Expansion • Wal-Mart capturing UK market • 3 main opportunities: • Short term return on investments • Medium term return on investments • Long term return on investments
- 5. Why Egypt? • Egyptian market offered considerable potential • Concentrated population • Largely unexploited domestic food market • Higher expenditure on food • Banking business opportunities • Stepping stone to other middle east counties
- 6. Human Resource Management • A Major Challenge • Transference of 64 expatriates from its headquarters • Family relocation allowances • High labor and management cost • Poor extensive training due to lack of time • Outsourcing issues
- 7. Marketing • Stores tailored to match target customers • Concentration on simplicity, moderate illumination and basics graphics configurations • Continuous modification in response to sales report and sales figure • Utilization of brand name • Focus highly populated areas • Potential customers with medium purchasing power • Introduced 130 Key value Items (KIV) • Introduced bar-coding in products
- 9. Political • Favorable Investment Condition • Good relation of British Government and Egypt Government • Later Degraded Relation • Seen as Jews supporter • Fatwas Issuing
- 10. Economical • Success in US and UK markets. • 11.9% Market Share in UK. • Market Challenger in US market • Ranked 14th among top global grocery retailer with 29,743 Million Euro Sales. • Joint venture with Edge Group
- 11. Social • One-stop shopping – Non Food Product – Benefitted • Cheap and Large Variety Product • Increase Women Work Force – Decline Domestic Meal Making • Social Discrimination – Show off • No culture blending of Egypt employee with Sainsbury
- 12. Technological • Barcode System • Automated Sales System – Marketing Analysis System – Pricing decide- Bundle etc. • Online Business ( UK) – Wanted for Egypt
- 13. Environmental • Organic Products • Reduce , Reuse and Recycle Approach.
- 14. Legal • Clearing Goods Through Custom and Licensing • Labor Regulation • Stamping out campaign – Local competitors
- 16. Strengths • Market Image and Experience • Good relation with government • Deep Pockets • Cheap & Variety. Weakness • Focused only on pricing and variety • Excess Standardization – process n procedure • Training • Very fast
- 17. Opportunity • Large Potential Market • High Consumption pattern of consumer • Favorable investment condition • Stepping stone for further expansion – Middle East Threats • Highly Religious environment – Unstable • Lack of government support • Currency fluctuation • Lots of labor regulation • Custom and licensing • Lack of Bureaucratic support
- 18. Sainsbury’s Future in Egypt 1. Scale down it’s operation ? or 2. Find new local partners ? or 3. Sell the business entirely ? Lost 55.5% of profit for from 1999 to 2001. Earning per share decreased from 31.4 to 13.8. Moreover if people don’t have trust what can be expected from government. Religious + Volatile nation. Easily impacted by external environment. Democracy was not yet mature.
- 19. THANK YOU