BUSINESS LOGISTICS

COLES GROUP LIMITED

BUSINESS LOGISTICS

SUPPLY CHAIN MANAGEMENT

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Executive summary
Purpose of the report is to present the crucial analysis of Woolworths supply chain that includes
the present supply chain management, sustainable practices of management with
recommendations. The information within the paper is depending on the journals and official
websites of Woolworths. Supply chain management of organization is very simple and relies on
the flat platform that makes the supply chain management inefficiency to serve customers.
Implementation within the process of supply chain management will help the business to serve
more customers and quality of products and services.
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Table of Contents
Executive summary.....................................................................................................................................1
Introduction.................................................................................................................................................3
Value chain..................................................................................................................................................3
Current operations and supply chain practices.............................................................................................5
Sustainable practices and recommendations................................................................................................6
Vulnerable of Woolworths..........................................................................................................................7
Conclusion...................................................................................................................................................7
Bibliography................................................................................................................................................8
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Introduction
Woolworths limited is known as one of the major Australian organization with extensive retail
interest in Australia and New Zealand. This has become second largest organization on the basis
of revenue after Wesfarmers. It was established in 22 September 1924 by Percy Christmas, Cecil
Scott Waine, George Creed, Stanley Chatterton, and Ernest Williams. Headquarter of the
organization are situated in the Bella Vista, New South Wales, Australia (Arli, et al., 2013).

It is known as the most celebrated and trusted retailer what offer fashion, food, home ware, and
beauty products. This organization regularly focuses on the innovation to meet the requirements
of customers with efficiency and create the customer value by organization success and execute
lean retail model.

Woolworth faces competition at high level. This organization has seen that brand value decline
because of the competition. Competitors of the organization lifted their brand value through
innovation. Competitors such as Aldi, Wesfarmers, and Coles are offering the discount at large
level with many offers. The ranking of the organization has dropped by one percent the not it is
on fifth place [ CITATION Aba19 \l 1033 ]

Target customers of the organization are high income earners. Customers of the organization fall
within the group of 8 to 10 as per the living standard measure. This organization is planning to
target two markets such as lower living standard measure groups and developing black middle
class people as like to buy food, clothes, and daily uses products from stores.

It has generated the revenue from products and services sales from regular operations have
increased by 5.3 percent compare to 2018. This organization has earned the total revenue of
56944 million dollar in 2018 through its operations which have increased and organization
earned 59984 million dollar in 2019. This has been increased by 3040 million dollar.

Value chain
It is known as the important strategic tool for the analysis of internal performance situations of
business. This indicates organization primary and support activities which allow the business to
support operations (Thomas, 2014). Primary activities of the organization are inbound logistics,
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outbound logistics, operations, marketing and sales, and services. Support activities are firm
infrastructure, human resource management, technology development, and procurement
(Darmawan, Putra, and Wiguna, 2014).

 Inbound logistics

Inbound logistics includes the direct relations with supplies and activities which required to
outlets inputs and disseminations. Woolworths is mainly involved within the distribution and
control network of distribution product in place of producing the products which it sells. This
organization contributes in procurement and logistics activities.

 Operations

This includes two activities which ensure and convenience the customer and values with
management of inventory and assessment of quality (Rajabian Tabesh, Batt, and Butler, 2016).
Woolworths has maintained the standardized process to detect and remove from lots of
distribution that are received from suppliers.

 Marketing and sales

Woolworths regularly works to increase the sales and focuses on the small advertising and sales.
It focuses on the activities such as In-store promotion and organizational dynamism. These helps
the business to increase the number of sales.

 Outbound logistics

Woolworth’s outbound logistics works to distribute the products and services through the
effective process of delivery.

 Services

Services of the Woolworths are effective as support the business to provide the best as include
the support and training regarding product, guarantees, warrantees, and many more.

 Human resource management

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Woolworths focuses to implement the effective human resource management programs and
involved within the process of infrastructure development to ensure the excellence management
of organization.

 Firm infrastructure

The organization Woolworths has strong database of skilled employees with high efficient
infrastructure and goo capabilities of sources. These are positive for the organization growth
strategy with robust IT infrastructure condition and support the supply chain system.

 Technology development

Technological development is very important factors which affect the retail industry and
Woolworth consider the application of technology known as green refrigeration technology in
which perishable goods can be stored for the long timer period.

 Procurement

Woolworth has already adopted the green procurement processes that help it to produce products
which are less detrimental for the environment. It is operating activities of business by
purchasing products from the supplier’s source that are less polluted.

Current operations and supply chain practices

Supply chain links value chains. This links all procedure incurred in organization from
purchasing of raw material from suppliers to deliver finished goods to customers. Supply chain
includes sourcing, procurement, scheduling of products, process of orders, management of
inventory, warehousing, transportation, and services of customers. It also embodies the
information system which is important to monitor all business activities. This is also known as
the integration of activities which produce material and services transform them within the
intermediate products and final products and deliver to customers (Bolwig, et al., 2013).

Effective supply chain management of Woolworths offers the customers high quality services
and products with low prices. It includes the coordination and integration flows with
organizations. The objective of supply chain management is to minimize the inventory with
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assumptions that products are available while required. It includes the determination of the
effective running of operations. It includes transportation vendors, transfer of cash and credit,
ware housing and inventory. Woolworth has redesign many number of distribution centre and
functions to minimize the cost and maintain the own control on the supply chain. This help the
business to conned the vendors and stores by distribution center. This organization manages the
delivery of products directly from the warehouses of vendors to stores of Woolworths (Dos
Santos, Svensson, and Padin, 2013).

Sustainable practices and recommendations

Woolworth is known as the growing supermarket in Australia which has huge number of
suppliers which supply many products within the stores. Supermarkets of Woolworths faces
many issues with the supply chain management like bulk order delivery and receiving dock and
lack of storage space for particular products. There is also inappropriate system of tracking of
receiving and ordering products which suffer from the Bullwhip impact, employees of
Woolworths stand helpless regarding the insufficient delivery of products and services through
the suppliers. Because of the management issues employees of the organization fails to deliver
the quality products and services to customers due to inappropriate management of inventory
system and control. This also presents the poor handling of stock, outlet, and suffers from many
products in to dump because of the out of demand and expiry date (Methner, Hamann, and
Nilsson, 2015).

This is very important for the business to implement the changes within the own logistics
services to effectively handle the primary transport services for delivering the products from
vendor to stores. Administrative management theory will be effective for the business to support
the supply chain management and redesign the supply chain management by integrated
infrastructure technology system on the basis of electronic data interchange model. This will be
crucial to achieve synergies within the supply chain transformation.

Every low price is known as the pricing strategy which will be effective to create the corporation
with suppliers to minimize the cost of supply chain and maintain the low steady prices.
AutoStockR is known as the computerized system of inventory replenishment for stores. This
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will help the business to achieve the objective for displaying the optimum amount in shelf. It will
help the business to monitor the trading activities and minimize the cost of transaction.

Vulnerable of Woolworths
This organization has effective logistics planning with strategic to run the supply chain
effectively without any concerns (Jie, Parton, and Chan, 2015). However crisis disrupts the plans
of Woolworths. Crisis such as Coronavirus forced the organization to make the many number of
hasty decision that can make the situations worse. The company supply chain management
assesses the situations and implement the approaches which minimize lose and solve the issues
as much as possible.

 Response plan

Contingency plan of the Woolworths are effective for the organization to keep the losses low
from crisis. This has the effective plan regarding suppliers and identifies which one is the most
significant for the business and least replaceable.

 Encourage crisis management training

This has undertaken the training of employees within the supply chain management. It helps it to
ensure the effective strategies and procedures by implementing in crisis. This organization
creates the team to identify and respond to crisis very fast.

 Take responsibilities for actions

Supply chain management works with the team to mediate the situations and minimize the
losses. This helps to get running the things easily again.

Conclusion
In the limelight of the discussion it can be concluded that supply chain management is effective
to handle the interconnected actions from purchasing the raw material to deliver the final
products to customers. Further discussion covers the recommendations which are important for
the business to manage supply management. Engagement with suppliers by improves
information and technology system is important to optimize and coordinate link within the
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supply chain. The redesign of supply chain management will help the business to save cost and
turn to the position of leaders within the retail industry of Australia. These increase the
satisfaction level of customers by providing the better goods and services.

Bibliography
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Abano, J., 2019. Woolworths, Coles brand value decline due to competition. [Online]
Available at: https://insideretail.com.au/news/woolworths-coles-brand-value-decline-due-to-
competition-201908
[Accessed 25 04 2020].

Darmawan, M.A., Putra, M.P.I.F. and Wiguna, B., 2014. Value chain analysis for green
productivity improvement in the natural rubber supply chain: a case study. Journal of Cleaner
Production, 85, pp.201-211.

Bolwig, S., Ponte, S., Riisgaard, L., du Toit, A. and Halberg, N., 2013. A methodology for
integrating developmental concerns into value chain analysis and interventions. In Markets and
Rural Poverty, Routledge.

Thomas, F., 2014. Addressing the measurement of tourism in terms of poverty reduction:
Tourism value chain analysis in Lao PDR and Mali. International Journal of Tourism
Research, 16(4), pp.368-376.

Dos Santos, M.A., Svensson, G. and Padin, C., 2013. Indicators of sustainable business
practices: Woolworths in South Africa. Supply Chain Management: An International Journal,
58(06), 58-69.

Arli, V., Dylke, S., Burgess, R., Campus, R. and Soldo, E., 2013. Woolworths Australia and
Walmart US: Best practices in supply chain collaboration. Journal of Economics, Business, &
Accountancy Ventura, 16(1), 25-36.

Jie, F., Parton, K. and Chan, C., 2015. Australian beef supply chain integration: case studies of
the two largest Australian supermarkets. International Journal of Supply Chain and Operations
Resilience, 1(2), pp.121-138.

Methner, N., Hamann, R. and Nilsson, W., 2015. The evolution of a sustainability leader: The
development of strategic and boundary spanning organizational innovation capabilities in
Woolworths. In The Business of Social and Environmental Innovation, Springer.
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Rajabian Tabesh, A., Batt, P.J. and Butler, B., 2016. Modelling the impact of environmental and
organizational determinants on green supply chain innovation and performance. Journal of food
products marketing, 22(4), pp.436-454.