1. Situation analysisAustralian grocery giants face off before an industry panel to determine which supermarket is winning the marketing war. Coles, is one of the giants of the Australian supermarket industry, always competing on product prices with its main competitor, Woolworth. In 2012, the supermarket market has grown compared to 2011, while customers go to the supermarket on average two to three times a week (Kruger, 2012). Coles and Woolworths hold 56% of the Australian food market. The concentration of competition made the rivalry palpable. Meanwhile, Coles aims to continue a price war that began in 2011, recently Coles confirmed it is continually closing the gap with Woolworths. As well as its supermarket business, Coles also operates liquor, online, fuel and convenience stores. In 2012, the market shares of food and liquor in the price of Coles and Woolworth were 30% and 42% respectively. Compared to 2011, Coles reported increased sales and business growth across most of its business lines in 2012. Richard Goyder, chief executive of Coles, said Coles will continue to focus strongly on delivering value to its customers and consistently put effort into pricing, provided the company can acquire more customers and sell more products, achieve efficiency in business and also through the supply chain (Courtney, 2013).1.1 SWOT Strengths Opportunities • Internal market • Loyalty: Flyby • Physical location • Pricing power • Ambassadors and sponsorships • Exclusive products • Adding new services • Supermarket prospects are favorable • Increasing globalization of food production and retail markets • Constantly increasing income level Weaknesses Threats • Weak cost structure (high costs) • E - trade... ... middle of paper ..... .r Devondale would feel smug and happy about this deal as it allows them to supply more dairy products (Coles and Devondale's home brand). This has the potential to increase farmers' profits by perhaps two or three cents per liter and reduce producer price volatility. In conclusion, Coles must stop using coercive power over suppliers and stop unethical or illegal activities, which helps build trust with their suppliers and bring benefits to their business in the long term. At the same time, it can increase the price of national brand milk, using strategic methods to attract more customers. In addition to the fair trade label, Coles could state that they would donate 10p to charity if a customer purchased the local brand milk to increase their purchasing pattern, as well as a good opportunity to develop their reputation..