SWOT analysis of Sobeys – Sobeys SWOT analysis

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SWOT analysis of Sobeys – Sobeys SWOT analysis

This is a detailed SWOT analysis of Sobeys. It examines the strengths and the weaknesses of the Sobeys. It also explores the opportunities and the threats facing the company. Sobeys Inc. is the second largest national grocery retailer in Canada. It was founded in 1907 by John W. Sobey as a meat delivery business. The business started expanding as a full grocery business in 1924. Sobeys Inc. is a wholly owned subsidiary of Empire Company Limited (Sobeys Inc., 2021).

Strengths of Sobeys

Sobeys operates in all 10 provinces in Canada. It has over 1500 stores and operates under different banners e.g. Sobeys, Safeway, IGA, Foodland, FreshCo, Price Chopper, and Thrifty Foods and Lawtons Drugs. It employs approximately 123,000 people (Sobeys Inc., 2021). Its financial position is strong as well. For instance, its revenue for the year 2019 was 26.59 billion Canadian dollars (Coppola, 2020).

Sobeys is widely known for its sustainability practices. Over the years, it has installed more natural refrigeration systems in its stores than all other food retailers in North America combined to reduce annual carbon emissions (Sobeys Inc, 2021). This initiative has resulted not only in the reduction of carbon emissions, but also in the attainment of some awards and accolades. For example, the Retail Council of Canada awarded Sobeys an ‘Excellence in Retailing Award for Energy and Environmental Sustainability’ in 2013. Similarly, Pictou County Chamber of Commerce named Sobeys ‘Large Business of the Year’ in 2014 for its support for local community.

Over the years, Sobeys has put a lot of efforts to modernise its retail network. It also improved productivity and introduced a very good number of innovative and service offerings. The primary focus of the company is to be widely recognized as the best food retailer in Canada.

Weaknesses of Sobeys

Sobeys had to recall a number of products over the years. For instance, the Canadian Food Inspection Agency expanded its list of recalled products sold at Sobeys and other grocery stores over Listeria Concern (Rosella, 2020). These recalls impact on customers confidence as many of them question whether appropriate steps were taken before allowing these products to be available on the shelves of the retailer.

Another weakness to consider is the pricing strategy of Sobeys. It prices its offerings higher than some of its competitors. However, some analysts observe that Sobeys has moved to lower prices in some of its offerings. For instance, it reduced in the last few years its prices of a number of grocery, dairy, frozen, health and beauty products.

Opportunities for Sobeys

Sobeys is the second largest grocery retailer in Canada. It has good opportunities to grow further in the country. Further growth can be achieved by many ways e.g. opening new stores and online sales channels. Sobeys’ recent deal with a British giant ‘Ocado’ demonstrates the former’s determination to penetrate further in the Canadian market. It has been reported in the media that Ocado will help Sobeys to build a website and mobile service, and manage its delivery system and customer service. Similarly, opportunities for Sobeys also exist in overseas market development.

Threats to Sobeys

Threat is the last element to address in the ‘SWOT analysis of Sobeys – Sobeys SWOT analysis’. Threats may come from different sources e.g. competition, new legislation, and changes in demographics. Sobeys faces a stiff competition from companies such as Loblaw, Wal-Mart Canada, and Costco Canada.

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Last update: 16January 2021

References:

Coppola, D. (2020) Revenue of Sobeys in Canada from 2013 to 2020, available at: https://www.statista.com/statistics/461484/revenue-of-sobeys-canada/ (accessed 16 January 2021)

Resella, L. (2020) ‘Products should be thrown out’: Large meat recall at Sobeys and FreshCo grocery stores continues to grow over Listeria fears, triggering warning from Health Canada, available at: https://www.insidehalton.com/news-story/10295974–products-should-be-thrown-out-large-meat-recall-at-sobeys-and-freshco-grocery-stores-continues-to-grow-over-listeria-fears-triggering-warning-from-health-canada/ (accessed 15 January 2020)

Sobeys Inc., (2021) Corporate, available at http://corporate.sobeys.com/ (Accessed 16 January 2021)

Photo credit: Sobeys Inc.

Author: Joe David

Joe David has years of teaching experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality, and tourism management. He holds a Postgraduate Diploma in Management Studies and a Post Graduate Diploma in Marketing Management.