Tesco Supermarket Business Strategy

581 words | 2 page(s)

Tesco supermarket is one of Britain’s leading supermarkets. It runs a chain of stores that are spread across the United Kingdom. Tesco has employed the best management and sales strategies that have seen it become one of the best supermarkets in the world. Their powerful mission and vision statement acts as the driving force that helps them to achieve higher heights of product quality and good customer service so as to be the market leaders. Tesco needs to embrace international competency by exploring the option of entering into the international business environment (Keegan, 2009). This will increase production and profit margins. The external environment will provide diverse cultures and business ideas that can make the organization stable and very strong.

In identifying the future state of the organization, Tesco Supermarket needs to employ planning and prioritization activities that will enable them achieve future success. Tesco Supermarket should explore the possibility of entering into the international market by opening new supermarkets overseas. A strategic plan for the international business market will enhance development of a consistent vision which will guide the management and the organization. This guidance will ensure that Tesco Supermarket develops clear organizational structures and actions which will support resource allocation and decision making (Terpstra, 2001).

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Entering into the international market is very challenging for Tesco Supermarket. This is because, today’s international market is hypercompetitive and dynamic (Terpstra, 2001). To identify, control and mitigate the risks that may be associated with international business, a clear framework to guide the organization’s directions, priorities direction and culture ultimately define the success of the plan. The plan is very important as it will assist the organization’s strategic vision into actionable plans and provide the necessary tools to manage resources. Tesco can make use of various entry strategies into the international business environment. These strategies may include direct exporting, indirect exporting, joint venturing, strategic alliances and direct foreign investment. The following diagram shows the entry strategies that Tesco Supermarket can employ to enter into foreign markets (Keegan, 2009).

Direct exporting will make the organization to be involved directly in marketing its products in the international market. This will enable Tesco perform all its exporting tasks by itself rather than delegating to other firms this will necessitate establishment of a marketing department that will oversee most of the tasks in the venture. This department should be involved in activities that range from marketing research to implementation of policies (Keegan, 2009). Indirect exporting offers the least risk for the organization while providing wide market control. The products are carried abroad by other organizations. Tesco will be engaged in any activity related to marketing. It will be handled like a domestic sale within the organization leaving the international facilitation to other organizations (Terpstra, 2001).

In joint venturing, the organization will look for international partners who are well conversant with the local markets. They will acquire partnership and work together. This enables the organization to have a firm control over the market as they can have all the information required from the international corporate partner. Strategic alliances enable organizations to share activities in the international business. Every organization takes a role that they can effectively manage to bring business success. Direct foreign investment can enable Tesco to establish international firms by establishing their units in the international sites (Terpstra, 2001). This needs sufficient market information and a lot of commitment to achieve.

  • Keegan, J. (2009). Global Marketing Management, 4th ed. Prentice Hall.
  • Terpstra, V. (2001). International Marketing, 8th edn, Chicago . Dryden Press.

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