WOW The market appears to have over reacted to this news which may present a buying opportunity for investors. A report by Bank of America Merrill Lynch suggests Woolworths consider a wholesale change to its strategy by axing Masters and focusing on its supermarket business.
By business reporter Michael Janda Posted July 26, Australia Woolworths may have taken decisive action to stem the bleeding in its core supermarkets division, but UBS still sees more risks than upside. In a note released after Woolworths yesterday unveiled a near-billion-dollar plan to cut staff and close at least 30 underperforming stores, UBS retail analysts said the supermarket giant still faces a very challenging market.
Aside from Woolworths' own problems, after taking its eye off the supermarket division during its failed Masters hardware experiment, UBS is forecasting that the Australian supermarket sector will become even more competitive.
While the investment banking giant has a relatively rosy view of the retail outlook, and is expecting supermarket sales to rise 3. While we continue to see risk to Australian grocery forecasts, there are some signs emerging that trading is no longer deteriorating and may have bottomed.
Eventually, even the best succumb to better, more agile competitors, writes Ian Verrender. The biggest threat to Woolworths, and its currently ascendant rival Coles, is the growth of cut-price supermarkets such as Aldi, and the potential entry of other large international rivals, such as fellow German retailer Lidl.
The reason these entrants are particularly dangerous is not just their potential to take significant market share - Aldi already has more than 10 per cent - but the huge pressure on margins these low-cost, home brand-focused retailers generate.
As UBS highlighted, Woolworths still has profit margins greater than 5 per cent in food and liquor, more than two-and-a-half times what UK supermarkets generate and nearly double the European average.
UBS data show Australian supermarket profit margins are still high globally. UBS These are markets where Aldi and Lidl have been operating for a long time, so it is reasonable to assume there will be further margin pressure and grocery price cuts in Australia.
The analysts warn that risk to the current share price is skewed 1 to 1.The biggest risk to Coles and Woolworths By Tristan Kitchener What’s the biggest risk to Coles and Woolworths?
Answer: Coles and Woolworths! That might sound strange but Australia is teetering on the edge of a supermarket price war as both Coles and Woolworths choose to slash prices in to order win over customers, and in doing . Nov 23, · Strategic Management analysis of Woolworth SupermarketUPD November 23, Woolworths Supermarket, for example, has more efficient workers compared to its major competitor Coles.
the increase in debt rate will cause the financial risk for Woolworths. Limited geographical market share. Obviously, most of Woolworths.
SYDNEY, July 25 (Reuters) - Woolworths Ltd alphabetnyc.com will book restructuring costs of up to A$1 billion ($ million) as part of a restructuring that will axe jobs and slow supermarket store rollouts, while considering the sale of online retailer Ezibuy, the Australian alphabetnyc.com's.
Woolworths' sale of its petrol stations to British giant Euro Garage announced last week raised the risk of greater competition on fuel prices, which could further hurt Coles' earning, Mr Errington alphabetnyc.com Major Risk Faces Woolworths Supermarket.
BAE BUSSINESS REPORT ON Woolworths Limited Company Student name and number Anna (xingfang zou) Class name and number Bae 11 Date of submission: 8/1/ Teachers name Mary and Katty Table of contents Executive summary The purpose of this report is to evaluate whether Woolworths worth investing from ethical issue and .
· In addition to normal financial functions, Woolworths is involved in financial risk management functions to safeguards the credit risk, liquidity risk, interest rate risk, and foreign exchange risk through group treasury functions (Hill et al., ).alphabetnyc.com