Topics: Strategic management, International trade, Globalization Pages: 11 (3631 words) Published: April 14, 2013
1. Introduction
Perhaps the biggest challenge that retailing organizations of today currently must face is how to adapt to the contemporary trend or calling towards globalization and internationalization. Most companies however, are haunted by the dilemma of whether to internationalize operations or not. This is the result of becoming more aware that the decision to do so does not only involve global market expansion while enhancing competitiveness and corporate brand, but involves issues concerning the market itself and the environment where it thrives.

Tesco PLC, United Kingdom’s largest and most profitable retail company similarly faces the same predicament in which it must make its assessment to consider the option of adding new international markets as a shift from its fully saturated market locations in the United Kingdom.

The concept of internationalization and/or globalization involves a decision or a series of decisions, that is, requiring a deliberate engagement in acquiring a more in-depth knowledge and understanding of the behavior of international markets as it matches the mission and vision that the company upholds. It is a decision that puts highly profitable companies in a dilemma of whether an entry into more global markets would ensure its continued stability and corporate survival. Indeed, it is a crucial decision that considers not only the financial readiness of the company in the expanse operations of the international business arena, but also requires a thorough evaluation of its global competitiveness, and where its strengths outweigh its weaknesses.

As Kotler (2007) has pointed out, even if some companies may find themselves to have the strength to become globally competitive, they are “facing the hardest competition than they have ever known”. (Kotler, 2007). Does this statement mean that those who pursue international business operations are still bound to lose despite a well-planned course of action and the determination to confront international market challenges? This is the question that befuddles the minds of managers on the corporate level of Tesco PLC. To come up with a viable recommendation, it is always best for organizations that have plans to internationalize, to have a complete grasp of understanding of the whole concept of internationalization. Internationalization however,must not be taken to be understood as a panacea for business and market sustainability as companies mature; but rather, as a strategic model that involves a multitude of intricate processes and factors and requires commitment to pre-set goals. In other words, internationalization is a management initiative that must incorporate concepts, tools and processes, to arrive at a sound business decision.

The decision would however, contain implications and possible outcomes which may trajectorily lead the company to a state where as if it was still on the inception stage of its organizational life cycle; or it could promise continuity of growth that is borne out of cost leadership and economies of scale with standardized marketing and production programs. (Solberg,1997) The reason for this is simple. International markets enjoy homogeneous demand of products that can enable companies to adjust their pricing policies relative to behavior of its market and market segments.

On its website,Tesco PLC has explicitly defined its existence as a global business that has a vision “to be most highly valued by the customers we serve, the communities in which we operate, our loyal and committed staff and our shareholders; to be a growth company and winning locally, applying our skills globally.” (Tesco PLC)

Being one of the world’s largest retailers, Tesco is currently operating in fourteen countries worldwide, an entirely remarkable feat if one takes notice of its meek beginnings from selling surplus vegetables in the East of London to its becoming a private limited company twelve years thereafter and...
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