Analyse the Market Conditions Faced by Waitrose at This Time (9 Marks)

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1A) ANALYSE THE MARKET CONDITIONS FACED BY WAITROSE AT THIS TIME (9)
GROCERY PRICE INFLATION HAS FALLEN FOR THE TENTH SUCESSFUL PERIOD- NOW 0.4% SINCE 2006
In a fast paced world Waitrose has benefitted from its ability to adapt and conform to society’s changes; convenience is in increased demand, and Waitrose’s free delivery on groceries gives them a competitive advantage in a very modern, technologically advanced market. Waitrose must retain profits whilst offering unique and modern services such as free delivery. As consumers become more price and quality conscious in the food market, mid-market players are becoming unpopular in comparison with discounters (e.g. Aldi, Lidl) and superior supermarkets (e.g. Waitrose). Value for money is often questioned by most consumers, and Waitrose must ensure they deliver quality along with their high price tag if they are to keep their quality, upmarket reputation (market differentiation). Buyers are now more conscious of their spending habits since the recession in 2008, leading to a preference of inferior goods, which is incredibly difficult for Waitrose to cater for whilst still offering quality and a high price tag. The market growth has fallen to 0.9% as a result of the grocery price inflation being at its lowest point since 2006.The inflation rate has decreased significantly as all supermarkets viciously cut prices in order to keep up with discounters, a move that Waitrose will find hard to do. However, as Waitrose cannot compete for price they must differentiate themselves in order to prove they are better than discounters in areas such as ‘provenance, quality, service and convenience’, so their value for money is not…...

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