Tesco Entry Into the U.S.a

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In 2006, after a considerable amount of research, Tesco announced that it will finally enter the U.S. market branded as “Fresh & Easy”. A year later, Tesco entered the U.S. market by applying new strategies for success and market entry compared to the ones that were used in the past. In the past, Tesco’s strategies for global expansion were (1) to aggressively enter markets in developing nations, (2) focusing on markets that were less competitive, and (3) entering through acquisitions. Tesco used completely different strategies to enter the U.S. market. First, the company announced that they will grow softly by entering markets on the west coast. The grocer entered the California, Nevada, and Arizona markets less aggressively compared to the growth seen in other markets. Second, the U.S. market is a highly competitive market for grocers, and one of the major reasons for Tesco’s previous successes was due to the lack of competition. By entering the U.S. market, Tesco was facing significant competition such as national competitors, local and regional grocers, and discounters. In order to compete more effectively in the U.S. market, Tesco branded itself differently to the American consumers. The grocer marketed itself as a convenient and express grocery retailer with hopes to set itself apart from national grocers such as Wal-Mart, Kroger, and Albertsons. Finally, Tesco entered the U.S. market organically rather than through acquisitions. When Tesco made the decision to go global they did so by acquiring grocery chains in other countries and through joint ventures, therefore, growing organically was going to be a new venture for the retailer. Although Tesco has seen successful returns through acquisitions in previous ventures, it decided to avoid this strategy for the U.S. market because of previous failures by other foreign retailers. One of the earlier entrants into the U.S. market were the British grocers Sainsbury’s and Marks & Spencer who entered...
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