Page 50 - DMGT551_RETAIL_BUSINESS_ENVIRONMENT

Unit 2: Structural Change in Retail Environment

External challenges Notes
One of the biggest environmental factors affecting McCain in 2005/6 was the growing
concern about obesity, particularly in children. This case study shows how McCain has
risen to the challenges of this debate and other external challenges.
McCain’s view is that its chips can and do play a role in a healthy balanced diet and it is
continually finding ways to ensure McCain products are as healthy as possible.
SLEPT analysis and social factors
In order to be able to understand its customers’ requirements and respond to other changes,
it is important for a company to analyse its environment. A SLEPT analysisis a tool that
helps to analyse the environment.
To create a SLEPT analysis the company needs to examine the key environmental factors
that affect its business. Having carried out the analysis it must then take action to respond
to the important changes that have been identified. Of course, some of the factors in the
SLEPT analysis can be placed under more than one of these headings.
The following analysis outlines SLEPT factors and indicates some of the changes that
McCain has made and is making.
Social factors
Social trends are one of the key factors affecting a business. Consumer buying patterns are
determined by trends. Just as the demand for some popular clothes are determined by
fashion, demand for food products is determined by eating patterns. Eating habits are
always changing. Currently one in four of all British potatoes consumed are eaten as
chips.
Recently McCain and other food producers have seen a slow down in sales as a result of
campaigns to encourage healthier eating such as that spearheaded by Jamie Oliver.
McCain has responded to this challenge in two main ways:

by reducing quantities of salt and oil throughout its potato products range. McCain
argues that these figures are very low already. For example, McCain’s Oven Chips
contain only 5% fat, 0.8% saturated fat and 62mg of sodium in every 100g portion.
They are made with only natural ingredients - specially selected potatoes and
sunflower oil.

by seeking to get the message over that its chips are not unhealthy. The message that
it communicates through public relations campaigns and advertising is that all
McCain potato products are made from simple ingredients such as whole potatoes
and sunflower oil.
A key way in which McCain has responded to changing customer tastes has been to
improve the nutritional make-up of its products. All of McCain’s potato products are now
pre-cooked in sunflower oil instead of regular vegetable oil to reduce saturated fats. There
is no added salt in oven chips and added salt has been reduced by up to 50% in other potato
products.

Legal factors
Responsible businesses not only abide by the law, they seek to create standards above
minimum requirements.

Contd...

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