Strategic Management: Tesco Stores - Research Paper Example

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Name: Instructor: Task: Date: Strategic Management: Tesco Stores Introduction Tesco is one of the major stores in the UK dominating the retail supply. The company launched its activities in the year 1956. Initially, the firm started as a miniature grocery stand…
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Download file to see previous pages Retailing section signifies an outsized trade in the American population. The company is presently a key player in the UK economy granting employment to a significant population. Regardless of its great achievement, the company understands the need of inviting creativity and strategic management to remain competitive in the market. According to Woods (26), with the emerging stiff competition pressures, recruiting effectual strategic organization is central to realization of successes. Competition in business is never a compromise but a reality. This central factor defines the triumph of any industry. Thus, companies, which are able to control this factor effectively, survive the forces. However, handling competitions force is a challenging endeavor and requires a coherent approach since competition is a multifaceted factor. Five major forces formulated by Porter explain the nature of competition in business. Tesco and their competitors Initially, the company was battling with few competitors. Nevertheless, the retailing in the UK has grown to be a competitive field in the late decades. Competition forces are so stiff and there exists enmity among large corporations in the market (Table 1). In the UK, large stores like Sainsbury’s, Morrison’s, and Asda challenges Tesco. Furthermore, in the American market, the corporation fights with the leader Wal-mart, Target and K-mart. In order to survive in such hostile environment, Tesco stores provokes strategic competitive model that necessitates various critical ideas. Superior branding is a key approach that has enabled Tesco to outweigh their competitors. The marketing campaigns and the eminence of their goods create convincing claims. The company provides a wide range of supply providing their customers with a room of choice (Wood, 17). Introduction of own branding has helped the company reduce on the operation cost hence maximizing profit while developing loyalty. This has enormously enhanced the popularity of the company making it thrive well in the market. Moreover, the Company has managed to maintain its products at a lesser cost than that of other retailers. Customers mainly go for the lesser costs hence such a condition makes their products be of preference to many. Such ideas like employing technology have reduced the Company’s operation cost. The salvaged cost aids in tumbling the cost of the products. Moreover, the Tesco utilizes a system of online sale, a model that is valuable in reducing costs and boosting services. A sustainable aspect of enduring taut competitions is outsourcing for new markets. This is an idea, which Tesco has extensively explored in its operations (Wood 6). The store has continuously opened stands in less competitive regions. Such critical venture is evident in its efforts to spread its activities to the international world. For instance, Tesco has lately extended its supplies to countries like China. China holds a large population and the vending forces are minimal hence it provides a potential market. New entrants Barrier to entry is a factor, which defines the state of competition in a certain sector. The barriers to new emerge are stipulated by various factors. They include the customers’ loyalty, preferences, capital, and access to distribution routes. Penetration of a stiff retail environment is associated with a number of difficulties (Henry 80). The risk of new entrances, which would challenge the company, is limited. Tesco is a large company with copious fully ...Download file to see next pagesRead More
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