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United Natural Foods VRIO / VRIN Analysis | Assignment Help
What is VRIO / VRIN Analysis ?
VRIO stands for – Value of the resource, Rareness of the resource, Imitation Risk, and Organizational Competence.
VRIO is a resource focused strategic analysis tool.
To build a sustainable competitive advantage the resources that –casename— needs to be valuable, rare, and difficult to imitate. Secondly the –casename— needs to possess capabilities, organizational structure, and culture to optimize the available resources usage. VRIO analysis can help organizations such as United Natural Foods to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for United Natural Foods? Defining Valuable in VRIO
A resource or capability is considered valuable for United Natural Foods , if it allows the
United Natural Foods to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow United Natural Foods to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for United Natural Foods.
What are Rare Resources for United Natural Foods? Defining Rare in VRIO
In an industry that United Natural Foods operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. United Natural Foods require rare resources to compete in the industry. If United Natural Foods don’t have rare resources that are required to succeed in the industry then United Natural Foods won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide United Natural Foods competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for United Natural Foods? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to United Natural Foods for certain period of time as all the competitors are going to try to imitate or replicate that resource. A sustained competitive advantage emerges, if the resource is difficult to imitate by the competitors. United Natural Foods can create inmitability by innovating on the product side, reducing pain points on service delivery, and having an effective post sales servicing strategy.
Check out the SWOT analysis of United Natural Foods
What is a Organization for United Natural Foods? Defining Organization in VRIO
Even if the United Natural Foods has all the valuable resources that are both rare and difficult to imitate, it won’t automatically result into a sustainable competitive advantage. The key to build the sustainable competitive advantage is to have organizational capabilities, expertise, and structure to exploit the resources. If United Natural Foods is not organized based on its strengths then it won’t able to exploit all the resources that it possesses.
Resources | Value | Rare | Imitation | Organization | Competitive Advantage |
---|---|---|---|---|---|
Brand Positioning of United Natural Foods in Comparison to the Competitors | Yes | No | Can be imitated by competitors but it will require big marketing budget | Yes, the firm has positioned its brands based on consumer behavior | Temporary Competitive Advantage |
Position among Retailers and Wholesalers – United Natural Foods retail strategy | Yes, United Natural Foods has strong relationship with retailers and wholesalers | Yes, United Natural Foods has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Brand awareness of United Natural Foods products and services | Yes, the brand awareness of United Natural Foods products are high | Yes, United Natural Foods has one of the leading brand in the industry | No | United Natural Foods has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Track Record of Leadership Team at United Natural Foods | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Successful Implementation of Digital Strategy at United Natural Foods | Yes, without a comprehensive digital strategy it is extremely difficult to compete | No, as most of the firms are investing into digitalizing operations | Can be imitated by competitors | One of the leading player in the industry | Digital strategy has become critical in the industry but it can't provide sustainable competitive advantage to |
Pricing Strategies of United Natural Foods | Yes, United Natural Foods has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide United Natural Foods with a Temporary Competitive Advantage |
Financial Resources of United Natural Foods | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | United Natural Foods has reasonably sound financial position | United Natural Foods has relatively sustainable Competitive Advantage |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that United Natural Foods operates in | No, none of the competitors so far has able to imitate this expertise | Yes, United Natural Foods is successful at it | Providing Strong Competitive Advantage |
United Natural Foods Customer Network and Loyalty | Yes, 23% of the customers contribute to more than 84% of the sales revenue | Yes, firm has invested to build a strong customer loyalty | Has been tried by competitors but none of them are as successful as United Natural Foods | United Natural Foods is leveraging the customer loyalty to good effect | Provide United Natural Foods medium term competitive advantage |
Opportunities for Brand Extensions for United Natural Foods products | Yes, new niches are emerging in the market | No, as most of the competitors are also targeting those niches | Yes can be imitated by the competitors | Brand extensions will require higher marketing budget | Temporary Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps United Natural Foods in delivering lower costs | No | Can be imitated by competitors of United Natural Foods but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Global and Local Presence of United Natural Foods | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of United Natural Foods but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Sales Force and Channel Management of United Natural Foods | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide United Natural Foods sustainable competitive advantage. Potential is certainly there. |
United Natural Foods SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis
Books and References
Ahir Gopaldas and Anton Siebert (2022 July August) "What You’re Getting Wrong About Customer Journeys",
Harvard Business Review , 92
Linda A. Hill, Emily Tedards, and Taran Swan (2021) "Drive Innovation with Better Decision-Making", Harvard Business Review 86
Dyer, J. H., & Hatch, N. (2004). Using Supplier Networks to Learn Faster. Sloan Management Review, 45(3), 57–63
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120
Dyer, J. H., Kale, P., & Singh, H. (2004, July–August). When to ally and when to acquire. Harvard Business Review, 109–115
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