Pros & cons

Ahold Report
Lecturer: ms. cattaneo

Table of Contents
Executive Summary......................................................................3
Introductions................................................................................ 3
Ahold company profile..................................................................4
Key Facts..................................................................................... 5
Finance................................................................................................................ 5
Growth Strategy.................................................................................................. 5
Ahold Delhaize intending merger........................................................................5

Threats........................................................................................ 6
Technology........................................................................................................... 6
Profitability.......................................................................................................... 6

Conclusions.................................................................................. 7
Recommendations........................................................................7
References................................................................................... 7

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Executive Summary
The CEO of Walmart is considering to acquire Ahold, an international retailing
group based in the Netherlands and also operates in the United States and
in other country in Europe. Some key facts about are Ahold has net sales of
32.8 billion euros, Ahold has 3,208 stores located worldwide and 227,000
associates worldwide. Ahold has a strategy where they have their value
statement: "Putting the customer in priority, Do what is right, Win as team,
Get better every day". Also, their mission statement that state "Better
choice, Better value, Better life, Everyday". Ahold and Delhaize are two
leading international food retailers that entered into an agreement of
merging with each other. Ahold is facing some threats and the biggest ones
are in the technological aspect of the company, the rising cost of raw
materials, competitors of Ahold, and lastly there is growing competition in
the market.

Introductions
The CEO of Walmart is considering to acquire Ahold, an international retailing
group based in the Netherlands and active in the United States and Europe.
For this decisions, he wants to get more information about the company, to
see the benefits and challenges that Ahold will have over the next 5-10years.
In this report Ahold, a Dutch retailer is analyzed for the purpose of making it
clear if Walmart should acquire Ahold. The information in this report was
gathered
from different reliable sources that are factual. In this report, the strategies
in which ahold implements in order to further grow their company are
covered and some important key facts. Also, in this report, the threats that
Ahold faces are covered and lastly the conclusions and recommendations are
given at the end.

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Main Body
Ahold company profile
Ahold is a big international retailing group that is currently stationed in the
Netherlands and currently operating in the United States and Europe. Ahold
has a great foundation, with millions of loyal customers, trusted and strong
local consumer brands, leading in their markets and proud associates.
Operating supermarkets and selling great food has been our core business
for over 125 years. Their customers have changing needs to be able to serve
them Ahold offers them their channel of choice. They have a successful chain
of stores and their online businesses are leading in the market. Their
customers are able to shop anytime, anyhow and anywhere that is most
convenient for them because of Aholds omni channel. They work to be an
even better neighbor and make meaningful contributions to all their
communities. Ahold is very caring and gives importance to well-being of their
customers, employees, and people that are involved with them. Ahold tries
to get their products from sources that Ahold thinks can deliver products in a
responsible manner and environmentally friendly. Ahold trains their
associates to offer customers great shopping experience that will enhance
customer satisfaction. The experience that the associates provides to their
customers is one of the big reasons why customers keep coming back to
Aholds associates to further enjoy the shopping experience.

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Key Facts
Finance
Ahold has net sales of 32.8 billion euros,
Ahold has 3,208 stores located
worldwide and 227,000 associates
worldwide. On this page, there are some
key financial indicators that will be
explained. It is clear to see that Ahold is
increasing each year in their net sales
but their net income has been
decreasing which means that their
expenses are more than the other years.
Ahold has a liquidity of 3.1, it is a
decrease but still they have enough liquid assets to cover their current
liabilities. Ahold's
Debt leverage is 1.9, an increase compared to their debt leverage in 2013
which means they have more borrowed money to finance their activity and
because of that they have a higher financial leverage.

Growth Strategy
Ahold is always attempting to grow as a company and they have their own
way of doing it.
Their value statement is "Putting the customer first; Doing what's right, Win
together, Get better every day". Also, their mission statement that state
"Better choice, Better value, Better life, Everyday". Ahold wants to create
growth by increasing customer loyalty. They want their businesses to be their
customers' favorite place to shop. They want them to enjoy their brands,
their stores, their people and their products so much that they do most of
their shopping with us and recommend us to others.
Ahold Delhaize intending merger
Ahold and Delhaize are two leading international food retailers that entered
into an agreement of merging with each other. As a result of this merger,
these retailers will have together a total of more than 375,000 associates,
very strong portfolio and that concludes to serving more than 50 million
customers per week in the Europe and United States. This merger will also
lead to enhanced scale across regions, market-leading retail offerings to
serve customers, changing needs, and a very strong financial profile.
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Therefore, they will have a better financial position to fund innovation and
investments in future growth.

Threats
Technology
In the next 5-10 years Ahold will have to better themselves especially in the
technological aspect of the company because of the internet, new ways of
managing the information systems, and the business process they will be
required to keep improving with the current technologies. If not
They will run the risk of losing a part of the market share.
Profitability
Ahold has some threats that are threatening their profitability, for example,
the rising cost of raw materials this threat could be damaging for Ahold's
profitability because Ahold is not operating in the most efficient way and the
rises in the cost of raw material could decrease their profit margin.
Competitors of Ahold generally compete with Ahold in the area of product
price and that can be a threat that can also decrease their market share.
Lastly, there is growing competition in the market and if Ahold does not
improve their position in the sense of sustainability of their market share.

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Conclusions
Ahold is a company that is clearly still growing after 125 years of existence in
terms of the company size and also they are attempting to expand with the
merger with Delhaize and growth strategy that shows that they are investing
resources to better their position as a company. Financially they are doing
fine with net sales of 32.8 billion euros but, they have some threats such as
competitors product pricing, the rise of cost of raw materials and these
threats can decrease their profit margin. It is clear that Ahold is a good
company but there are some areas that are holding Ahold back. In these
areas, Walmart is relatively strong such as managing their cost.

Recommendations
After research and the analysis its clear that it is beneficial for Walmart to
purchase Ahold. It will enable Walmart to grow in terms of company size and
that will lead to a bigger market share and make Walmart a stronger market
leader. Also is recommended that resources should be invested in
maintaining and growing the IT part of Ahold and also it is important to
implement Walmart's low-cost strategy and business process to Ahold in
order to improve areas where Ahold is lacking.

References
Ahold. (N.D.). Ahold increasing customer loyalty. Retrieved from
www.Ahold.com: https://www.ahold.com/Media/TheNetherlands.htm#!/Media/Increasing-customer-loyalty.htm
Ahold. (N.D.). Intended merger Ahold Delhaize. Retrieved from
www.ahold.com: https://www.ahold.com/#!/Media/Intended-MergerAhold-Delhaize.htm
Best, D. (2014, February 28). What the analysts say - Ahold facing
challenges. Retrieved from www.just-food.com: http://www.justfood.com/analysis/what-the-analysts-say-ahold-faceschallenges_id126071.aspx
SWOTanalysis24. (N.D.). Koninklijke Ahold N.V. financial SWOT analysis Strengths, Weaknesses, Opportunities, Threats of Koninklijke Ahold
N.V.. Find 1. Retrieved from www.SWOTanalysis24.com:

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http://www.swotanalysis24.com/swot-k/62043-swot-analysiskoninklijke-ahold-n-v.html
(Ahold, Ahold increasing customer loyalty, N.D.)
(Ahold, Intended merger Ahold Delhaize, N.D.)
(SWOTanalysis24, N.D.)
(Best, What the analysts say - Ahold facing challenges, 2014)

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