Tesco Goes Global
1. Why did Tesco’s initial international expansion strategy focus on developing nations? There are valid reasons why Tesco decided to operate on developing countries as they planned to expand its business internationally despite its competencies in many aspects in terms of business operation and management right in its home market - in the United Kingdom . These reasons have been proven effective after many years of recorded successes in their performance in the international markets As an initial step, venturing with local retailers in some Eastern European and Asian countries where there are few capable competitors at stake is very effective in carrying out its business plan with less efforts and threats as a result of political, social and economic resistance. Tesco simply avoided strong competition outside its country where marketing strategies might be powerful than it has. Its primary goal is to penetrate and establish a business before utilizing other strategies to compete in the market . This means that their marketing strategy is effective as far as their research is concerned but that will not be so if utilized in countries known to have strong competitive advantage As a result, Tesco as one of the largest retailing company in the world has generated more business ventures in addition to what it already established in the United Kingdom having a in 2005 alone. Getting into global business became easy for Tesco after carefully analyzing the trend in international business. 2. How does Tesco create value in its international operations? There are factors that create value for Tesco: 1) the company devotes considerable attention to transferring its core capabilities in retailing to its new ventures, 2) the company hires local managers and support them with a few operational experts from the United Kingdom, 3) the company’s partnering strategy in Asia is a great asset because the companies Tesco has teamed up with are good and...
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