Tesco Operations

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Tesco PLC International
Tesco was founded in 1919 in London by Jack Cohen. Since then the business has grown rapidly and now operates in 14 markets across Europe, North America and Asia. Tesco employs over 500,000 people and serves millions of customers every week. A significant focus that the business has is to do the right thing for customers, employees and the local communities which they serve. They have a vision of being highly valued by customers, communities, staff and shareholders, as well as being a growth company, applying skills to a global market. In 2011, in order to achieve their vision, they set out a seven-part strategy which would reflect changing consumer demands and the increased global nature of the organisation. Number 4 in the strategy states Tesco’s objective of growing retail services in all their markets. Therefore, the company is driven towards achieving growth. By moving into international markets, Tesco have been able to establish a reputation and gain market share. The number of Tesco stores worldwide stands at 6,351 and in 2012, the business had revenue of £64.539 billion across all markets. Tesco also has the aim of building their workforce. By moving into new markets abroad, they have been able to establish a diverse and multicultural workforce, with the brandname being widely recognised across the globe. The company’s main products are groceries and basic supermarket goods. However; they also sell clothing, electrical goods, toys, jewellery, and many other things. Tesco also do banking, internet and have a mobile phone network. Tesco is a Public Limited Company (PLC) which means that it is owned by shareholders and run by directors. The current Tesco share price, as shown above, is 372.80p. There are around 2,174,296,900 people with shares in the business. The table to the left, also taken from the London Stock Exchange website, shows that the earnings per share (EPS) value has gone up every year since February 2008, standing at 37.52p. This, in addition to the increase in dividend yield, shows that shareholders are getting higher dividend payments than they were back in 2008. Therefore, the business is doing well for this to be the case and will attract shareholders more easily.

Tesco UK
The UK business started trading in 1924 and is the core of Tesco. It has over 300,000 employees and over 3,000 stores. Over 60% of Tesco’s group sales and profits come from the UK business. It has the widest range of any food retailer; Finest and Everyday Value are the biggest food brands in the UK. In April 2012 the business announced a £1 billion commitment to improve the shopping experience for customers. The UK plan was; Building a better Tesco. In 2011/2012 the business’s revenue was £42,248 million. Tesco China

The business entered China in 2004 and since then has opened more than 120 stores. They currently employ over 26,000 people. The business has also developed its own freehold shopping malls under the brand, Lifespace. These are operated as a Tesco hypermarket, which provides Chinese consumers with a one-stop shopping destination. China is a major sourcing location for the business and the international sourcing headquarters are based in Hong Kong with a hub in Shanghai. Tesco currently buys around £2.25 billion worth of goods and services from China for the international group every year. In 2011/2012 the business’s revenue was £1,311 million. Tesco India

Tesco’s operations in India include sourcing and a service centre, as well as a franchise with Tata Group. The Hindustan service centre in Bangalore provides IT, Financial, Research and Development and business services to the group markets. They have sourcing offices in Bangalore and Delhi; over £300 million worth of products are sourced from Indian suppliers each year. In 2008 Tesco announced a franchise agreement with the retail part of the Tata Group. Their hypermarket chain, Star Bazaar, has access to Tesco’s retail...
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