A Case Study of Tesco
Introduction
Strategic planning is an essential requirement for an organization to be successful in the industry. Tesco already created various advantages over its competitors like Asda. However, because of the influence of the globalization and the idea of international retailing, Tesco created strategic activities that will continue the business to deliver the customers’ preferences.
Strategic Planning
Tesco, as one of the successful marketers in the Europe, is fully open for the expansions. The organization’s operation in the central Europe expanded and influenced the other countries such as the Hungary, Poland, Czech Republic, and Slovakia. The phases of the expansion are also identified as the organization’s plan in attempting to connect all the chains in the market. In addition, the acquisition of the stores is also part of the strategy which gained additional growth in their sales. The investigation of the growth sales of the organization reached the other countries as much as in Asia and their retailing market (Yoruk and Radosevic, 2000). This idea was proven by the organization as they start to invest in most of the countries in Asia such as Thailand and South Korea. Slowly, the organization is emerging in the markets in Taiwan and continuously researching in the environment of Malaysia.
Unlike other retailers, the Tesco is still slow in exploiting the organizations potential in both Western and Asian markets. When Tesco entered in the market after the attack of the crisis, it has a potential in contributing to the transitioning of the economic situation and make it worse. Tesco can find stable position and be benefited when there is a strong presence of transition because of the two fold reasons. Firstly is that hypermarkets already exist in Asia, and Tesco already acquired the hypermarket chains, and second is the introduction of the emerging middle class that gathers more opportunity in shopping at a hypermarket (Yoruk and Radosevic, 2000; Tidd, Bessant, and Pavitt, 2001).
Expansion and Exploration
The confidence of the Tesco to create a market in Malaysia can be ambitious but because of the choice of the locations such as the non saturated markets that allows the market share to be generated, the success for the Tesco is foreseeable. In addition, the adaptation and adoption of the organization on the technologies aided the Tesco’s success, not only in the store management but also in training and in networking of the suppliers. Based on the organization’s philosophy in exporting, the given service can be only emphasized through the training and the network of the supplies which is possible in the operation in the foreign markets (Yoruk and Radosevic, 2000).The influence of the current structure of the market can give another opportunity for the organization to provide additional marketing strategies in capturing the additional number of customers. The entry of an investor in the market facilitates the market liquidity while ensuring the integrity. The activity involves in the trading industry are suited and conducive in the retail markets (Singh, 2001).
Benefits
Creating a market in Malaysia can be the best opportunity for the Tesco because of the two things. First, there are opportunities in the technology that is very advantageous for Tesco. The technology sector and its application in the market, however, face new challenges. But through the recognized challenges, the Tesco might contribute towards structuring the better technology that can be more efficient and effective. Second, the Malaysia can act on the current economic conditions such as the issues on recession because the pride of the country’s wealth on the raw materials can contribute to the additional revenues and promises the future incomes (Brandt and Lim, 2009). The competition in Malaysia, however, may weight in Tesco but through the adoption of the trading platforms, regulations, and the discovery of the efficient cost and price, there will be a centralized system (Singh, 2001).
Conclusion
The attempt of the organization to enter in the foreign only reflects the aspiration or the goal of the organization to continuously aim for success although there is an available threats due to the globalization. In this kind of action, the Tesco must provide valuable evidence that there is an opportunity in the foreign market through reviewing the information and other conducted researches. Since expansion is the main driver of most large retailers, this is also the best opportunity of the organization to be success in international retailing. The importance of strategic planning is to create advantages in the competition and provide better approach in the market.
References:
Singh, R.A., (2001). “The Development of a Corporate Bond Market: The Malaysian Experience”. Accessed 08 Nov 2010, from http://www.ifc.org/ifcext/publications.nsf/AttachmentsByTitle/Building_Local_Bonds_Chp.8/$FILE/Building_Local_Bonds_Chp.8.pdf
Tidd, J., Bessant, J., & Pavitt, K., (2001). “Managing Innovation: Integrating Technological, Market and Organizational Change”, John Wiley & Sons, New York.
Yoruk, D.E., & Radosevic, S., (2000). “International Expansion and Buyer-Driven Commodity Chain: The Case of Tesco”. Accessed 08 Nov 2010, from http://profesores.ie.edu/enrique_dans/TESCO/international%20expansion.pdf
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