The Analysis of the Uk Supermarket and Tesco
The analysis of the UK supermarket and Tesco
Introduction:
The role of supermarket is becoming far more significantly in daily life. Consumers could see different kind of brands and variable goods. The role of the supermarket is tried to satisfy the consumers’ demands. Since the supermarket came out, the advantages such as low price and cost, much convenience made the supermarket develop quickly. As a consequence of the rapid development, the supermarket plays an important role in the retail industry. It not only saves large amounts of labor capital and operating cost, but improves the shopping environment. In this essay I will make a specific analysis of the UK supermarket system through economic theories. Firstly, I will analyse the situation of the UK supermarket via Five Forces Model (Michael Porter 1979). And then, I will select the largest supermarket in UK, Tesco, to analyse the strategy of this firm by using the value chain (Michael Porter 1985).
Tesco is the largest British retailer both by global and domestic market share. And it is the third largest retailer in the world followed the Wal-Mart and Carrefour. Tesco opens around 2,440 stores and employing more than 400,000 people. Tesco has entered into areas such as clothes, electronics, financial services, internet services and gas stations. Currently, the market share of the retailer in UK is more than 30 percent. As of March 2008, Tesco could be found in every postcode of the UK.
Five forces analysis
The aim of the five forces model illustrated by Michael Porter (1979) is to analyze an industry to determine that which forces can influence the industry strongly so that the firm could make the best position in this industry. And the five forces include: the threat of new entrants; the power of buyers; the power of suppliers; the threat of substitute products and the competitive rivalry among the existing companies.
Threat of new entrants
Firstly, the threat of new entrants is rather
Introduction:
The role of supermarket is becoming far more significantly in daily life. Consumers could see different kind of brands and variable goods. The role of the supermarket is tried to satisfy the consumers’ demands. Since the supermarket came out, the advantages such as low price and cost, much convenience made the supermarket develop quickly. As a consequence of the rapid development, the supermarket plays an important role in the retail industry. It not only saves large amounts of labor capital and operating cost, but improves the shopping environment. In this essay I will make a specific analysis of the UK supermarket system through economic theories. Firstly, I will analyse the situation of the UK supermarket via Five Forces Model (Michael Porter 1979). And then, I will select the largest supermarket in UK, Tesco, to analyse the strategy of this firm by using the value chain (Michael Porter 1985).
Tesco is the largest British retailer both by global and domestic market share. And it is the third largest retailer in the world followed the Wal-Mart and Carrefour. Tesco opens around 2,440 stores and employing more than 400,000 people. Tesco has entered into areas such as clothes, electronics, financial services, internet services and gas stations. Currently, the market share of the retailer in UK is more than 30 percent. As of March 2008, Tesco could be found in every postcode of the UK.
Five forces analysis
The aim of the five forces model illustrated by Michael Porter (1979) is to analyze an industry to determine that which forces can influence the industry strongly so that the firm could make the best position in this industry. And the five forces include: the threat of new entrants; the power of buyers; the power of suppliers; the threat of substitute products and the competitive rivalry among the existing companies.
Threat of new entrants
Firstly, the threat of new entrants is rather