BM633: Strategic Agility Assignment

 

Introduction

In the current time, each organization aims at understanding market needs which support in offering most accurate and suitable product & services. UK’s food market consists of all the ready to eat and edible product that are consumed with the purpose of fulfilling nutrient requirement. UK’s food and beverage industry has earned a profit of 168 billion in 2024 and expected to grow by 12.1% at end of 2033 (UK food and Beverage Market Size, 2025). The current report is based on identifying opportunities within UK’s local food market and plan to undertaken opportunity.

2. Overview Of Chosen Sector

For understanding in-depth information related to the UK’s local food sector, a survey has been initiated via questionnaires on the 25 customer near my campus that aids in successfully gaining overview of the local food market. Further, thematic analysis will be initiated that aids in easily forming conclusion.  Below table and graphs define the results of the survey:

Theme 1: Consumers are highly attracted towards local food shops.

Particulars	Respondents	No of respondent
Yes	16	64%
No	8	32%
Not sure	1	4%
Total	25	100%

 

Interpretation: It has been identified that large number of customers are attracted toward local food shops due to affordability and authentic taste.

Theme 2: Most of the local food consumer belongs to the 16-24 age group.

Particulars	Respondents	No of respondents
10-16	4	16%
16-24	10	40%
24-32	2	8%
32-40	5	20%
40 and above	4	16%
Total	25	100%

 

Interpretation: It has been determined that young generation generally prefer eating outside as they aims at trying different and new food items and maintaining social connection.

Theme 3: Digitalization and organic food are two crucial requirement of consumer

Particulars	Respondents	No of respondents
Digitalization	7	28%
Organic foods	7	28%
Affordability	5	20%
Quality	2	8%
All of the above	4	16%
Total	25	100%

 

Interpretation: In the present time it has been explicated that digitalization and organic food are two major factors that influences customer purchasing decision.

Theme 5: Borough market is mostly preferred by majority of respondent for fulfilling their food needs.

Particulars	Respondents	No of respondents
Borough market	14	56%
Broadway market	5	20%
Camden Market	2	8%
Kensington	2	8%
None of the above	2	8%
Total	25	100%

 

 

Interpretation: After conducting survey on 25 consumers, it has been explicated Borough market is generally preferred by majority of respondent for fulfilling their local food needs.

Theme 5: cafes are major substitute of the local food shops.

Particulars	Respondents	No of respondents
Café	17	68%
Restaurant	2	8%
Coffee shops	3	12%
None of the above.	3	12%
Total	25	100%

 

Interpretation: it has identified that consumer generally prefer eating at Cafes that are major substitute of local food shop.

3. ANALYSIS OF FOOD SECTOR

Pestle analysis:

Political	Introduction of Brexit  Food and safety regulation
Economic	Higher inflation and interest rate Higher unemployment
Social	Change in customer preference Health and wellness trend
Technological	Continuous change in technology More emphasis over automation (Pestle analysis of Food industry. 2024)
Environmental	Climate changes Higher focus over waste management
Legal	Need to align with Health and safety regulation Ensure compliance with Equality Act.

Competitiveness of food sector

UK’s local food sector operate in perfectly competitive market in which firm could not decide price on their own. This result in higher threat of new entrance which requires organizations to offer product and services according to customer needs.

Five force analysis

            For determining the competitiveness of the local street food sector, five forces analysis has been initiated below:

No of competitors:

It has been identified that there are large number of local food organization within UK which creates issue in sustaining competitive edge within industry (Five force analysis of UK’s Food sector, 2024). This also develops obstacles in managing customer’s loyalty towards firm and thereby influencing long term stability of the business entity.

Threat of new entrants:

There is high threat of new entrance due to the limited number of rules and regulations which leads incline in the overall number of competitors (Schrobback et al, 2024). Moreover, there is a lower capital requirement in the food industry as compared to other which also result into increasing number of competitors.

Bargaining power of suppliers:

It has been determined that there are large numbers of suppliers that provide all the required raw materials and thereby aids in reducing their overall bargaining power. This helps organization to easily source all the resources at reasonable prices and thereby boosting overall profitability.

Buyer’s bargaining power

There is a high bargaining power of the customers due to the presence of large number of local food business entities (Abbas and Myeong, 2024). This will negatively impact the firm’s profitability as increase in cost could result into losing significant number of customers.

Threat of substitutes 

There is a high threat of substitution as customer switch to restaurant and cafes for fulfilling their needs and thereby impact the overall sales.

Competitive strategy:

            After critically analysing the local food industry, it has been determined that differentiation is the major competitive strategies of this sector.  In local food industry, organization focuses on offering high quality services, taste and quality food which aids in boosting customer’s satisfaction (Kamarulbahrin, Zamri and Sani, 2023). Further, local food businesses lay emphasis over offering affordable product & services which aids in attracting the large number of customers and thereby contributes in sustaining competitive edge.

Market growth

            The local food market in UK is earning annual revenue of over 167.09 Billion pound in the year of 2024 and it is estimated to grow by 5.3% CAGR (Market growth of UK food sector, 2025). This indicates high growth opportunity of the local food business within UK. It has further determined that 67% of total UK consumers prefer local food stalls which indicate high growth opportunity of the industry.

3. STRATEGIC CAPABILITY MATRIX

Strategic-capability matrix is the 2*2 matrix that used to identify the strengths as well as weaknesses of the organization and supports in determining accurate strategies & policies for the future improvements (Karmee, 2023).  Below is the strategic capability matrix of UK food industry:

High capability and High performance Enhancing supply chain Innovation Quality control	High capability and low performance Variety of product but lacks quality Highly qualified employees but lack knowledge to implement skills
Low capability and High performance Entering into new market (Strategic capability Matrix of food industry. 2024) Hiring skilled and competent employees Less focus over technology	Low capability and low performance Lack of desired knowledge Poor cross team communication

 

4. Overview Of Proposed Business Opportunities

Basis	Opportunity 1	Opportunity 2
Overview	There is a huge opportunity to integrate technology and shifting towards digitalisation within the industry (Valverde-Ayllon, Chire-Fajardo and Ureña-Peralta, 2022).	High need of organic and ethnic food within UK which could be introduced in the local food stores.
Location	Borough market	Wales, Edinburgh
Target	Target market: All men’s and women between age group of 14 to 40 and belongs to middle and lower income class. Project revenue: Firm is expected to 11% profit at the end of first year.	Target market: It will target both men and women of age 18 to 60 that are more concern over their health and overall well being. Project revenue: The firm is expected to earn 29500 at the end of first year and expected to earn the required return after second year.
Competitive advantage	Technology reduces the scope of errors and support in enhancing production speed.	This business will offer healthier food options to people which aids in attracting customers (Scharadin, Zanocco and Chistolini, 2023).

 

1. Adoption of IT and digitalization

It has been identified that each individual focuses on purchasing cost conscious product that could be offered by optimizing all the operation. Moreover, it has been discovered that accessibility and facilities are latest requirement of customers within this industry that could be fulfilled by introduction of technology and digitization in the operations (Panzone, Larcom and She, 2021). Therefore, a local food business should integrate AI in their operations which aids in managing food quality and ensuring safety. Further, this type of business should be established within Borough market as consumers are mostly likely to visit this market for fulfilling their needs that aids in earning higher profits.

Projected five year projects:

Below is the expected profit after integrating Technology in local food business:

Particulars	I year	II year	III year	IV year	V year
Revenue	150000	165000	195000	210000	240000
Cost of good sale	90000	100000	120000	125000	145000
Gross profits	60000	65000	75000	85000	95000
Less: expenses	43000	44600	46100	47200	48100
Utility bills	6000	6500	6800	7000	7200
Equipment and machinery	15000	15000	15000	15000	15000
marketing expenses	4000	4100	4300	4500	4700
Technology maintenance	4000	4000	4000	4000	4000
Worker salaries	3000	3500	4000	4200	4500
Rent	5000	5500	6000	6500	6700
Other expenses	6000	6000	6000	6000	6000
Net Profit	17000	20400	28900	37800	46900
	11%	12%	15%	18%	20%

 

            The firm is planning to introduce digitalization in their operations which support in reducing salary and wages expenses and also assist in boosting overall firm’s profitability. This technology aids in enhancing overall production speed and support in reducing scope of errors and mistakes and thereby offering goods at lower prices (Durrant et al, 2021). Moreover, digitalization assists customer in placing order from any place which support in boosting overall firm’s profitability. This technology also offers safety and sustainability which assist in providing personalized experiences which aids in attracting and retaining customers and thereby boosting overall market reputation. Along with this, digital marketing tactics will also be utilized that aids in attracting larger target market and support in offering personalized content to customers and thereby boosting overall sales.

B. Offering organic and ethnic food

In the current times, there is an increasing concern over consuming healthy and nutritious food and local food stall are always consider to offer unhealthy food options. Along with this, 49.58% of UK’s consumer prefers ethnic tastes that are generally offered through local shops (Ethnic food preference within UK, 2024). In this regard, there is an opportunity to offer organic and ethnic food to customer that aids in attracting larger target market and thereby support in managing stability in the industry (Yang et al, 2024). It has been identified that 80% Welsh consumer and 75% Edinburgh consumer prefer organic and sustainable product that indicates high viability of the business at this locations. Further, there are larger numbers of local farmers in this area that aids in easily sourcing all the required raw material and thereby support in successfully fulfilling customer’s needs.

Proposed revenue:

Below is the projected five years revenue for the organic and ethnic food company.

Particulars	I year	II year	III year	IV year	Year
Revenue	180000	200000	225000	275000	320000
Cost of good sale	110000	122000	135000	165000	192000
Gross profits	70000	78000	90000	110000	128000
Less: expenses	40500	40500	40500	40500	40500
Insurance	6000	6000	6000	6000	6000
Machinery	12000	12000	12000	12000	12000
Marketing expenses	3500	3500	3500	3500	3500
Utility	5000	5000	5000	5000	5000
Wages and salaries	7000	7000	7000	7000	7000
Rent	4000	4000	4000	4000	4000
Other expenses	3000	3000	3000	3000	3000
Net Profit	29500	37500	49500	69500	87500
	16%	19%	22%	25%	27%

           

            It has been identified that there are less number of organization that offers sustainable and organic product and services which provide huge opportunity for the business entity. The firm offer healthier product that aids in fulfilling the needs of large number of customers and thereby assists in sustaining competitive edge within industry.

5. Evaluation Of Two Strategic Option

For identifying the most effective business opportunities for the above two, SAF analysis has been initiated. This analysis emphasis over analysing business idea on the basis of suitability, Acceptability and Feasibility based on which most accurate decision could be initiated (Do et al,  2021). Below is the in-depth analysis of the two above mentioned business opportunity on the basis of SAF model:

Business ideas	Suitability	Acceptability	Feasibility
Adaptation of technology and digitalization	Currently, each consumer focuses over purchasing product at lower cost and prices that could be attained through high level of technology. This indicates high suitability of the business idea and thereby boosting overall profitability (Baker et al, 2021).	The proposed business idea is highly acceptable as this will help in fulfilling the needs of diverse stakeholder. Investors are aiming to earn higher profits that will be offered through highly efficient production method (Kowalska et al, 2021).	Resources: High availability of all the resources Finance: Difficult to establish highly efficient system in allotted budget of 340000 pound.
Introduction of organic and ethnic food	This business idea is also highly suitable as majority of country’s population are switching towards consuming healthier product which indicates high need of the proposed business idea.	The given business offers highly acceptable as it aids in fulfilling needs and requirement of various stakeholders. Moreover, organizations that provide sustainable and healthier food are highly accepted by target market and thereby enhance overall profitability (Zhang Dhir and Kaur, 2022).	Resources: The entire organic and sustainable product is easily available that aids in successfully establishing business entity. Finance:  The proposed business could be easily established within allotted fund which indicates high feasibility of the proposed business idea.

 

RECOMMENDATION

• After critically evaluating the present market situation and undertaking SAF analysis, it has been suggested that client should introduce organic and ethnic food in their offering. This will aid in successfully attracting large number of customers and thereby enhancing overall profitability (Chelaru, Holerga and Zemeleaga, 2023).
• Moreover, the IT introduction requires huge amount of cost that creates issue in managing their profits and thereby develop issue in managing stability.
• Further, after evaluating proposed revenue of five years, it has been identified that IT introduction is unable to attain the targeted rate of return which is successfully attained by other opportunity (Gundala and Singh, 2021).
• This denotes high viability of the organic food business that could be started with comparatively less funds and offers higher profits than others.

 

References

Books and Journals

Abbas, Z. and Myeong, S., 2024. A comprehensive study of blockchain technology and its role in promoting sustainability and circularity across large-scale industry. Sustainability, 16(10), p.4232.

Baker, P., Lacy-Nichols, J., Williams, O. and Labonté, R., 2021. The political economy of healthy and sustainable food systems: an introduction to a special issue. International Journal of Health Policy and Management, 10(12), p.734.

Chelaru, M., Holerga, T.A. and Zemeleaga, C.G., 2023. Study on the Consumption and Demand of Organic Food Products. Ovidius Univ. Ann. Econ. Sci. Ser, 23, pp.298-303.

Do, Q.N., Mishra, N., Wulandhari, N.B.I., Ramudhin, A., Sivarajah, U. and Milligan, G., 2021. Supply chain agility responding to unprecedented changes: empirical evidence from the UK food supply chain during COVID-19 crisis. Supply Chain Management: An International Journal, 26(6), pp.737-752.

Durrant, A., Markovic, M., Matthews, D., May, D., Leontidis, G. and Enright, J., 2021. How might technology rise to the challenge of data sharing in agri-food?. Global Food Security, 28, p.100493.

Gundala, R.R. and Singh, A., 2021. What motivates consumers to buy organic foods? Results of an empirical study in the United States. Plos one, 16(9), p.e0257288.

Kamarulbahrin, M.N.Q., Zamri, Z. and Sani, A.S.A., 2023. Parametric Investigations of Drying Roselle Calyces Flower. Mekatronika: Journal of Intelligent Manufacturing and Mechatronics, 5(1), pp.51-56.

Karmee, S.K., 2023. Moving towards the application of Biocatalysis in Food Waste Biorefinery. Fermentation, 9(1), p.73.

Kowalska, A., Ratajczyk, M., Manning, L., Bieniek, M. and Mącik, R., 2021. “Young and Green” a study of consumers’ perceptions and reported purchasing behaviour towards organic food in Poland and the United Kingdom. Sustainability, 13(23), p.13022.

Panzone, L.A., Larcom, S. and She, P.W., 2021. Estimating the impact of the first COVID-19 lockdown on UK food retailers and the restaurant sector. Global Food Security, 28, p.100495.

Scharadin, B., Zanocco, C. and Chistolini, J., 2023. Food retail environments, extreme weather, and their overlap: Exploratory analysis and recommendations for US food policy. Plos one, 18(11), p.e0289282.

Schrobback, P., Zhang, A., Muller, J., McAllister, R.R., Wu, W. and van Klinken, R.D., 2024. Agri-Food Export Barriers: A Comparative Analysis of Australia’s Meat, Horticulture, and Aquaculture Sectors. Journal of International Food & Agribusiness Marketing, pp.1-26.

Valverde-Ayllon, M.C., Chire-Fajardo, G.C. and Ureña-Peralta, M.O., 2022. Reduction of the refining-conching time of Peruvian dark chocolate: a case study. International Journal of Food Science and Technology, 57(10), pp.6572-6579.

Yang, Y., Barnes, H., Yang, B., Onofrei, G. and Nguyen, H., 2024. Food waste management for the UK grocery retail sector—a supply chain collaboration perspective. Production Planning & Control, 35(15), pp.1961-1974.

Zhang, Q., Dhir, A. and Kaur, P., 2022. Circular economy and the food sector: A systematic literature review. Sustainable Production and Consumption, 32, pp.655-668.

Online

Ethnic food preference within UK. 2024. Online. Available through: < https://www.grandviewresearch.com/horizon/outlook/ethnic-food-market/uk#:~:text=UK%20ethnic%20food%20market%20outlook&text=Chinese%20was%20the%20largest%20segment,segment%20from%202018%20to%202030.>

Five force analysis of UK’s Food sector. 2024. Online. Available through: < https://www.twoteachers.co.uk/post/porter-s-five-forces-in-the-uk-fast-food-and-supermarket-industries#:~:text=Applying%20Porter's%20Five%20Forces%20to,strategically%20position%20themselves%20for%20success.>

Market growth of UK food sector. 2025. Online. Available through: < https://www.statista.com/outlook/cmo/food/united-kingdom#:~:text=Revenue%20in%20the%20Food%20market,US%2432.01bn%20in%202025.>

Pestle analysis of Food industry. 2024. Online. Available through: < https://pestleanalysis.com/pestle-analysis-of-the-food-industry/>

Strategic capability Matrix of food industry. 2024. Online. Available through: < https://www.fao.org/faolex/results/details/en/c/LEX-FAOC214496/>

UK food and Beverage Market Size. 2025. Online. Available through: < https://www.imarcgroup.com/uk-food-beverage-market#:~:text=The%20UK%20food%20and%20beverage,12.1%25%20during%202025%2D2033.>