Report on Tesco

Topics: Retailing, Online shopping, Strategic management Pages: 8 (1460 words) Published: April 18, 2015
1.0 Introduction
All corporations have to work at expanding themselves within the region as well as internationally. They have to work at framing and adapting different strategies in order to reach optimum success. This report analyzes the external environment and scans it thoroughly so that strategies can be implemented and adopted later on. Company Background

Tesco is a company that originated from the UK, but has now expanded globally. Starting from Hertfordshire, it is now operating within Asia, Europe as well as USA. Back in the year 2012, Tesco had 2975 stores within the United Kingdom which brought in a revenue of 64.5 billion pounds per annum. By 2014, these stores have expanded within 14 countries with 6531 stores. Tesco also offers other services like insurance, online shopping and banking. Vision and Core Values

The vision of the organization is the addition of an important position in the minds of the clients they serve, community altogether, keen and steadfast staff and the shareholders. The organization's visions is to develop and change themselves into a creative and present day association through applying their aptitudes all internationally. The core value of Tesco is to expand its retail organization which would help to convey the organization's core purpose. In addition, the organization lives up to expectations devotedly to win client's faithfulness and to make brand value. 2.0 Strategic Position

With a large number of stores, Tesco ranks amongst the global giants. The principle of strategy of Tesco and their strategic position is the design of the shareholder value with the help of focus and innovation upon the customer satisfaction. Their strategic position is based on their seven principle theory which includes: Nurturing business primarily within the entire United Kingdom Achieving strengths in all departments

Retailing all over the world successfully
Serving the society with premium advantages
Defining values and purposes with the help of team work
Becoming the founder of new brands
Expanding internationally and globally
2.1 PESTEL Analysis
Political Factors
The political system of every country Tesco expands within has an effect on the company. Tesco is also bound to the European legal system
There will be multiple employment regulations
Economic Factors
Tesco has the effect of exchange rates on all its revenue
Any decline in European market could cause damage to Tesco
Socio-cultural Factors
Bulk shopping
Trend of eating out
Increase in aging population
Increase in female workers
Technological Factors
Enhanced operations
Enhanced communications
Strong online presence
Saving of time and money
Environmental Factors
Increased pressure on environmental awareness
Organic food provisions
Legislative Factors
Tesco is bound to legal policies
Competition creates price wars
There is a strong need for product differentiation

2.2 Porter’s Five Forces
Michel E. Porter has created five powers through which the organization can recognize its position in the business and figure out if the position of the organization is more aggressive than the others. He has recommended that the appeal of the business sector can be measured through the long haul degree of profitability of the firm. The significant five strengths of the model are discussed as below. 2.2.1 Threat of Substitute Product and Services

In the retail business, the danger for the substitute items is typically low for the food items and medium for the non-food items. However if there should be an occurrence of the food items the risk of substitute items is high with respect to the non-food things there are little chains of comfort stores. Be that as it may these accommodation stores, off permit and natural shops are not considered as the real danger for the general store like Tesco. Then again, to face these issues Tesco is opening more stores in the remote region to offer the helpful transportation framework for...

References: Charles W.L. Hill and Gareth R. Jones. (2012). Theory of strategic management with cases. Eighth edition
Datamonitor (2011). Competition in the retail industry. Available at
Euromonitor, (2013). “Tesco in the Retail Industry”. Available at
Fame (2010), Annual Reports Analysis – Tesco plc, FAME International
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