Tesco PLC expansion into Germany using Foreign Market Servicing Strategy - Essay Example

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The main objective of the research is to identify the appropriate entry mode for TESCO PLC and aligning the current characteristics for supporting the foreign market current strategy (FMSS) when the company wants to expand its presence in Germany…
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Tesco PLC expansion into Germany using Foreign Market Servicing Strategy
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Center of discussion in this paper is Tesco PLC. The first store of the company has opened in Edgware, North London. The main business of the company was grocery but the company has made wide the portfolio as they started to offer their products in the following sectors.
• Home Electronics
• Clothes and Home-wear
• Entertainment e.g. Television, Mobile communications
• Pharmaceuticals
• Finance / Credit cards
• Insurance.
Tesco has the core competency in strategic pricing. They are able to offer their product to every class of people using the plan of strategic pricing. Their strategic pricing plan includes branded products, premium private level, budget private level and private level. Tesco developed the online shop in the year 2007 which is a revolution in the sector. The customers can purchase the goods through online. The company has gained competitive advantage and ever since 2007 they have remained in that way. The company is present mainly in Asia and Eastern Europe where they dominate in the market. The company is present in over 13 countries. Wal-Mart and Tesco are the main competitors of Tesco.
The retail and more precisely the grocery market is dominated by the low pricing competition and focusing on the private level brands (own brand products). But in the European Union the levels of competitive pricing is controlled by the regulatory bodies that control the levels of market price.. As the company is already in the E.U. they are abide by the rules of the regulatory bodies, so it will not be difficult for the company to expand their business in a new E.U. country.

The company has to only maintain the country specific legislations along with the little implications of the vertical integration. Tesco Corporate Social Responsibility An accommodative stance was adopted by the company when they approach to CSR. Tesco used to organize some social and voluntary programmes; they meet the ethical and legal requirements. (Griffin, R. Pustay, M 2009, p.158). The company follows the CSR which is followed by the European Union. Lisbon Agenda is followed by the company which aims for creating better jobs and social cohesion which would ensure the economic growth for the specific country, (European Citizens Consultations 2009). The companies have to maintain the environment properly as per the P.E.S.T. analysis of the E.U. The main focus of Tesco is maintaining and improving the supplies which are environment friendly and also recycled; develop job availabilities and maintaining good relations and support for the farmers who are supplying. Market Selection Western Europe can be a positive move strategically for Tesco as it has presence in 13 countries including Asia and Eastern Europe. The researcher argued that the western region of Europe is the most attracting part of the world for the businessman as there are lots of wealthy customers (Griffin, R. Pustay, M 2009, p.54). A short list of top 4 most appropriate countries can be drawn ...Download file to see next pagesRead More
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