Case Study Tesco - assessing new possibilities

Essay by stratos84University, Bachelor'sB, December 2008

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TESCO Group evaluation1. Identify the development directions that Tesco had followed from its origins as a UK based grocery retailer.

2. Identify the development directions 'available' to the company in the future and assess the relative suitability of each of these options by ranking them (using Illustration as an example).

3. For each of the top four development directions in your ranking compare the relative merits of each development method (internal, acquisition or strategic alliance).

4. Complete your evaluation of the options that now appear most suitable by applying the criteria of acceptability and feasibilityTesco group has indicated significant progress in last years, which can be found in figures from balance sheets. Profit and Sales of the Group in UK have doubled comparing with recent four years to £2.28bn and £39bn. Looking further in to statistics of business there also is increase in number of stores that had tripled to 2672 and amount of workers boost a 60% to 273.000

people. Focusing on European performance there was increase in sales by 4 % to 13%. Asian figures didn't disappoint founders either there was 5 % increase in sales gaining 11% on Asian markets.

Clearly there is development in Tesco business, but which moves justify increase in profits. There's been long way from its origins as average grocery store to what Tesco is currently. Tesco invested heavily in every part of the offer that could bring more satisfaction to customer. Management understood that availability is very important for customers in effect Tesco is open 24/7. Customers can do the shopping any time any day. Tesco targets view variety of customers that's why Group diversified its range of products. From cheap products, available almost to everyone, to more expensive - satisfying more demanding customers. Company understood as well importance of local differences,