Small and medium enterprises in the United Kingdom are very common and occupy more than half of the country’s economy. These companies have many opportunities for development, but only if the strategy is properly developed, which will take into account all the features of the environment and possible risks for the company. One such small business is the Little Pigs butcher shop located in the center of Manchester. Given the market trends in the UK, the store is at risk of being on the verge of bankruptcy, so the development of an effective management strategy for it is necessary.
Porterâs Five Forces
The number of small and medium enterprises in the United Kingdom specializing in the food and drink sector can be called quite average. At the same time, the largest number of enterprises are bakeries, while only companies engaged in the distribution of meat were only fourth most popular, as of 2019 (Bedfort, 2022). This sector is not the most popular, as there are certain nuances for new companies to enter the market. First, companies need to find trusted suppliers of quality products. Most of the meat suppliers in the UK are reluctant to do business with small businesses due to the low profitability of such partnerships. Another option may be parallel farming, for which it is necessary to obtain the appropriate permission from the local government. Secondly, to enter the food market in Britain, companies need to pass product quality checks and obtain the appropriate certificates, which is a resource- and time-consuming process and is accompanied by the risk of business failure. Thus, the threat of entry into the market of a new competitor is small, but not excluded.
The number of meat specialty stores has decreased by 1,186 between 2008 and 2020 (2022), according to statistics on specialized stores for the retail sale of meat and meat products in the United Kingdom (UK). Although this number is not crucial, it does highlight some industry patterns that should be considered when creating a management plan. Shoppers often prefer supermarkets to single stores because of the opportunity to get everything they need in one place. In addition, the sphere is gradually declining due to the tendency of buyers to buy ready-made meals. Therefore, there are risks that customers may substitute raw Little Pigs products with ready-made products from restaurants in the area.
Customers of the store note the high quality of products and reasonable prices. Moreover, we can note the high customer focus of the company, as evidenced by positive feedback on social networks. Based on these factors, we can note the high level of competitiveness of Little Pigs. However, the company is still inferior in its characteristics to some competitors, primarily due to its narrow specialization and the lack of well-established Business-to-Business partnerships.
SWOT Analysis
At the moment, one of the main strengths of the company is a high level of social capital. According to Prasanna et al. (2019), social capital is one of the key factors for a company’s sustainability and growth. The high reputation of the company is evidenced by the positive feedback from customers about the quality of the products sold. In addition, buyers also note reasonable prices, correlated with the quality of the goods. In addition, one of the strengths of the company can also be called its location.
On the other hand, among the weaknesses of the company, first of all, it is worth noting the lack of successful marketing strategies. The company does not provide online ordering of products, but customers can order goods by phone. In addition, the company’s social media is also irregular, for example, the last post on Twitter was in August 2021 (TheDidsburyButchers, 2016). This factor practically excludes the possibility of high-quality communication with customers. Moreover, the lack of an effective marketing strategy also reduces potential customers’ awareness of the company.
The shop is in the center of Manchester next to a lot of restaurants. Therefore, a key opportunity for the development of the company may be the establishment of B2B partnerships with neighboring establishments. In addition, the company already has loyal customers who can recommend the store. The high level of the company’s social capital is maintained due to the absence of sharp price hikes, as well as the high competence and qualifications of employees. Moreover, as practice shows, a company can use social networks for additional attraction and communication with potential buyers and has all the resources for this.
Among the threats, it is important to name the trend of declining consumer interest in single food retailers. Most customers prefer supermarkets to single specialty stores. In addition, according to Sayyida et al. (2021) the pandemic has also affected consumer behavior. Many customers prefer companies that provide delivery services. Moreover, during the pandemic, the tendency of the customer to buy ready-made meals has increased, which can also have a negative impact on the profitability of Little Pig’s business.
Strategies for Sustainability and Competitiveness
After analyzing the Little Pigs environment, among the possible strategies for maintaining the competitiveness and growth of the company, first of all, it is worth mentioning the development of a marketing strategy. According to Costa and Castro (2021) and de Vries et al. (2018), the use of digital platforms is a key factor in the development of SME and attracting new customers. Based on existing resources, a company can activate social media to keep in touch with existing customers as well as raise awareness among potential buyers.
Another option could be to invest in technology and introduce an online shopping option for customers. One of the key factors to consider when applying new technologies in business is understanding the needs of the client (Forbes Technology Council, 2019), therefore, based on the changed behavior of retail consumers, this option will be quite cost-effective for the company. The introduction of e-commerce technologies is the best option to increase the profitability of the company with a reasonable price-performance ratio. In addition, developing a company’s official website will also help raise awareness among potential buyers and potential business partners.
Establishing B2B partnerships is another strategy for developing a company and increasing its profitability. First of all, this is facilitated by the convenient location of the store. Near the Little Pigs store there are more than 10 restaurants and cafes, some of which may be interested in purchasing the store’s products at reasonable wholesale prices. In addition, having partnerships with other companies can ensure that Little Pigs has a stable income, regardless of customer behavior. Therefore, this strategy will help in maintaining the performance of the company as well as increasing its market competitiveness.
Reference List
Bedford E. (2022) Food manufacturing: Number of SMEs in the United Kingdom (UK) 2019, by product type (2022) Web.
Costa, J. and Castro, R. (2021) âSMEs must go onlineâE-commerce as an escape hatch for resilience and survivabilityâ, Journal of Theoretical and Applied Electronic Commerce Research, 16(7), pp. 3043-3062.
de Vries, H. P., Veer, E. and de Vries, K. V. (2018) âAn examination of SME social media use in the food industryâ, Small Enterprise Research, 25(3), pp. 227â238.
Forbes Technology Council (2019) â10 Critical Aspects To Consider Before Adopting A New Technologyâ, Forbes, Web.
Number of specialized stores for the retail sale of meat and meat products in the United Kingdom (UK) from 2008 to 2020 (2022) Web.
Prasanna, R. P. I. R. et al. (2019) âSustainability of SMEs in the competition: A systemic review on technological challenges and SME performanceâ, Journal of Open Innovation: Technology, Market, and Complexity, 5(4), 100.
Sayyida, S. et al. (2021) âThe impact of the COVID-19 pandemic on retail consumer behaviorâ, Aptisi Transactions on Management (ATM), 5(1), pp. 79-88.
TheDidsburyButchers (2016) [Twitter]. Web.