abhishreshthaa
Abhijeet S
Kesko is a Finnish retailing conglomerate. It operates, among other things, in the Finnish markets for groceries, DIY and interior design products, agricultural supplies and machinery, consumer durables, and car sales. It also has subsidiaries in other countries such as Estonia, Latvia and Russia.
Kesko headquarters in Katajanokka, Helsinki, Finland
Kesko's loyalty card is called Plussa. Its closest competitor is the S-Group, which operates in almost the same fields as Kesko.
Strengths
- Kesko knows its home market well and has already reacted to changing competitive conditions in it by opening its own discount stores.
- Well-recognised brand in the Finnish market.
- Diverse range of retail outlets with national coverage.
- Multi-format operations give Kesko an edge in both food and non-food retailing.
- Strong brand recognition and a good reputation for both quality and value on private label brands.
- Strong loyalty card and brand recognition with Finnish consumers.
- Over three million (out of five million population in Finland) consumers are signed up to the Plussa card.
- Very talented CEO of Ruokakesko
Weaknesses
- Vulnerable on issues relating to pricing, especially with Lidl's presence growing fast.
- Kesko's corporate structure - with its reliance on independent retailers - means that it is less fleet of foot compared to other retailers.
In terms of organic growth, Kesko has nearly reached saturation point with some of its banners, especially the larger formats.
Regulations on opening times favour smaller stores, of which competitors such as Rautakirja have more.
Kesko has missed out on some potentially worthwhile acquisitions during the year 2005, when increasing consolidation occurred in the Finnish retail market.
Opportunities
- A fast expansion of the Cassa discount stores can counter the threat from German discounter Lidl.
- Kesko holds a strong position with traditional grocery outlets such as supermarkets. It is now set to expand further into the c-store market with the K-pikkolo chain.
Following the acquisition of Pikoil, Kesko has great potential to grow in the forecourt store market.
The reorganisation of the food business with focus on the K-market banner will clarify operations and create a stronger brand image.
Next to further potential for growth in its food business, there is new grounds to conquer with its recently acquired furniture stores, Asko and Sotka.
Threats
- Finnish market more consolidated, effectively creating larger competitors to Kesko.
- Lidl has become a fierce competitor in the Finnish market, lowering profit margins for everyone with its hard discount style.
The internal reorgansiation of Kesko's food business may temporarily hamper dynamics within the company.
There is still potential for other international players to move onto the Finnish market in the medium term, which could challenge Kesko's position in the long run. Carrefour, for example, is thought to be considering linking up with a local player.
Kesko headquarters in Katajanokka, Helsinki, Finland
Kesko's loyalty card is called Plussa. Its closest competitor is the S-Group, which operates in almost the same fields as Kesko.
Strengths
- Kesko knows its home market well and has already reacted to changing competitive conditions in it by opening its own discount stores.
- Well-recognised brand in the Finnish market.
- Diverse range of retail outlets with national coverage.
- Multi-format operations give Kesko an edge in both food and non-food retailing.
- Strong brand recognition and a good reputation for both quality and value on private label brands.
- Strong loyalty card and brand recognition with Finnish consumers.
- Over three million (out of five million population in Finland) consumers are signed up to the Plussa card.
- Very talented CEO of Ruokakesko
Weaknesses
- Vulnerable on issues relating to pricing, especially with Lidl's presence growing fast.
- Kesko's corporate structure - with its reliance on independent retailers - means that it is less fleet of foot compared to other retailers.
In terms of organic growth, Kesko has nearly reached saturation point with some of its banners, especially the larger formats.
Regulations on opening times favour smaller stores, of which competitors such as Rautakirja have more.
Kesko has missed out on some potentially worthwhile acquisitions during the year 2005, when increasing consolidation occurred in the Finnish retail market.
Opportunities
- A fast expansion of the Cassa discount stores can counter the threat from German discounter Lidl.
- Kesko holds a strong position with traditional grocery outlets such as supermarkets. It is now set to expand further into the c-store market with the K-pikkolo chain.
Following the acquisition of Pikoil, Kesko has great potential to grow in the forecourt store market.
The reorganisation of the food business with focus on the K-market banner will clarify operations and create a stronger brand image.
Next to further potential for growth in its food business, there is new grounds to conquer with its recently acquired furniture stores, Asko and Sotka.
Threats
- Finnish market more consolidated, effectively creating larger competitors to Kesko.
- Lidl has become a fierce competitor in the Finnish market, lowering profit margins for everyone with its hard discount style.
The internal reorgansiation of Kesko's food business may temporarily hamper dynamics within the company.
There is still potential for other international players to move onto the Finnish market in the medium term, which could challenge Kesko's position in the long run. Carrefour, for example, is thought to be considering linking up with a local player.