Chosen Retailing companies to be evaluated: Tesco and Wal-Mart
Why e decided to choose Wal-Mart and Tesco?
Market leaders in their respective home markets, Diversified range of products, Intense international expansion.
Wal-Mart: The Statistics at present:
Type of Company: Public
Employee growth: 10.5%
First store opened in 1962 by Samuel Walton and his brother J.L. (Bud) Walton in Roger, Arkansas. With more than 7,250 stores, including Wal-Mart Super centers(US) and ASDA (UK), make Wal-Mart the #1 retailer in the World. In 1999, ASDA Group plc is acquired for $10.8 billion.
Tesco: The Statistics at present:
Type of Company: Public
Employee growth: 74.3%
The first store was opened in 1929, in Middlesex.
With 3,956 stores in 14 markets Worldwide, making it the 4rd biggest retailer in the World Tesco.com is the leading Internet delivery service in the UK.
Financial performance?? *****
The retail environment: macro and micro
(especially in how they are impacting on your set of retailers)
( analyze the chain of stores, types of retail formats, theory and pragmatics that determine their siting; look at a large retail store for each of your competing retailers and show factors influenced their location decision)
Micro and Macro evaluation, and site selection that Tesco and Wal-mart carry out Accessability: Transport infractures, parking facilities; footfall Accessability: staff and supplier access
Reputation: catering for everyone
Location: cost outweighing potentail profit
Appropriate location:community and dispoasble income
Locating in visible areas so positive assocation is achieved Location within reach of suitable labour pool
Wal-Mart has a total of 7, 262 stores worldwide and are the world’s largest retailer by revenue whereby Tesco are the fourth largest global retailer with 3,262 stores worldwide. Location is paramount to successful retailing; each and every store that Wal-Mart and Tesco have opened in the past would have been strategically assessed through the stages of macro location evaluation, micro location evaluation and site selection in order to create a profitable store. The choice of a supermarket location is considered to be the single most important decision a retail organisation has to make and is critical factor of success. Mobility & time Constraints:
Shopping (referring to groceries) are normally bought in a local area. Access to infrastructure
Convenience for both customers, suppliers and employees to access the supermarket without restrictions. Most Asdas in the UK have free parking space
Access to a labour pool to gain suitable workers e.g. Managers, supervisors, floor workers etc. Most importantly attracting enough customers to ensure a profit level. Importance: Supermarkets generally only have a small area of attracting customers. This is because people ideally go to the nearest one. Usually within a 3 Mile radius because it is seen as inconvenient to travel further. “Location will impact on sales and distribution costs and competitive intensity may vary if there are strong local competitors in some regions.”
Supermarkets: Big Four (Tesco, Sainsbury, Asda and Morrison) Location will influence the level of competition, sales, the number of customers being attracted as well as profit gained. Its important for Wal-Mart to have a competitive location otherwise potential customers are likely to go elsewhere hence the reason for Asda (as well as the supermarkets) having a considerable amount of products making a loss. “Geographic location to take advantage of lower distribution, assembly, raw materials or energy costs, and institutional factors such as government regulations (e.g. larger lorries on the roads can reduce distribution costs but at other environmental and social costs).” (Hooley. 2004) Cost may outweigh the benefits of owning a store in...