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Safeway (SWOT Analysis)

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“SWOT is an acronym for the internal Strengths and Weaknesses of a firm and the environmental Opportunities and Threats facing that firm. SWOT analysis is a widely used technique through which managers create a quick overview of a company’s strategic situation. The technique is based on the assumption that an effective strategy derives from a sound “fit” between a firm’s internal resources (strengths and weaknesses) and its external situation (opportunities and threats). A good fit maximizes a firm’s strengths and opportunities and minimizes its weaknesses and threats. Accurately applied, this simple assumption has powerful implications for the design of a successful strategy.”

Safeway 

Safeway is one of the largest retailers in the US grocery chain market. Safeway offers grocery items through its supermarket stores under the brand names of Safeway, Vons, Dominick's Finer Foods, Carr-Gottstein Foods, Genuardi's Family Markets, and Randall's Food Markets. Safeway's success is mainly attributed to the brand equity it has built up over the years and the recent performances of its Lifestyle format stores. However, increasing competition in the US retail market could affect its margins and market share.

Strengths, Weaknesses, Opportunities and Threats (SWOT)

Location of Factor

TYPE OF FACTOR

Favorable

Unfavorable

Internal

Strengths

  • Strong retail operations
  • Strong performance of Blackhawk
  • Brand equity

Weaknesses

  • Product recalls
  • Decline in same store sales growth
  • Relatively low employee productivity

External

Opportunities

  • Increasing demand for organic products
  • Growing demand for private label products
  • Increasing online sales

Threats

  • Increasing competition
  • Rising labor wages in the US
  • Sub prime crisis
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