Tesco's Business Plan and Strategies

This assignment examines Tesco's business plan, highlighting its strategies for growth and development. The analysis delves into Tesco's use of segmentation, targeting, and positioning (STP) to understand customer needs and preferences. It also explores the Ansoff Matrix, PESTEL, and SWOT analyses as tools for strategic planning and market expansion. The document concludes by emphasizing the importance of a well-structured business plan for achieving success in a competitive market.

Business Plan

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK ..............................................................................................................................................1
1. Business idea of TESCO ........................................................................................................1
2. Mission and vision of TESCO................................................................................................1
3. Need back up for products and services..................................................................................2
4. Research findings....................................................................................................................3
5. Positioning, segmentation and targeting ................................................................................5
6. Conclusion ..............................................................................................................................6
REFERENCES ..............................................................................................................................7

INTRODUCTION
Business idea can be termed as the concept which is being used for the financial gain
which focuses on service or product that are offered to gain money. An idea is based on the
objectives of business so that an organisation will be achieve their desired targets (McKeever,
2016). This report is based on the case study of TESCO, who is going to present a business idea
in order to maximise their profit.
TASK
1. Business idea of TESCO
TESCO is the largest food retailer of UK, offering wide variety of non-food like
entertainment, electrical goods, insurance etc. or food products in market. It is having more than
2000 stores in UK and maximising their stores in foreign countries like US, Hungary, China and
Thailand. Company makes offering of competitive package of benefits and pay regarding all jobs
whether as manager of assistant in depots or stores.
The business idea of company is to get high business growth in various cases like
restaurants and cafes and to open outlets in their own superstores. Company also make an
attempt to enter in international market (Fernández-Guerrero, Revuelto-Taboada and Simón-
Moya, 2012).
Cited organisation provides variety of service, financial services, groceries and products
to the customers of UK, Brazil, China, Poland, Greece etc. Company provides fresh food
products, bakery, frozen food, baby products, drinks, household, health and beauty products and
also give services like inspiration and events which includes service of breakfast, lunch box, kids
party, baking etc. Company has also started its range to provide services of clothing for men,
women, kids, school uniforms etc. Team of TESCO focuses mainly on innovation so that they
will be able to provide more good features in their products and services which will attract
consumers and satisfy their requirements and needs in appropriate manner.
2. Mission and vision of TESCO
Company like TESCO is having focused business and enjoy long term success. They are
having a core vision which is constant while they adopt various practices and business strategies
from time to time in order to cope up in changing world. In a competitive environment, if a
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company will not have a clear vision, then it will be difficult for them to make survival and will
also lack in direction.
A vision is considered as an aspirational view of where business wants to go. It gives a
benchmark for organisation which they wants to achieve (Kwong,Thompson and Cheung, 2012).
Its vision guide organisation's direction and strategic decision. TESCO' s vision is:
“ To have highly valued business by: the communities in which we work, customers that are
being served, committed and loyal colleagues and also shareholders”.
Vision of company is having five elements that sort of company they wants to be. These
elements are:
 Needed and wanted all over the world
 Business growth having various opportunities
 Innovative, modern and full of ideas
 Winners locally while making use of skills everywhere
 Loyalty, inspiring and gaining communities', customers' and colleagues' trust
The mission statement is in relation with goals and vision of an organisation and
describes what company wants to achieve and what is its purpose. Mission statement of company
can be defined as:
“ We produce what is better, together”.
3. Need back up for products and services
At TESCO, company is working hard in order to serve their customers better every day.
They look for the personal data, which customers share with company. Organisation wants their
customer to have confidence that their data is secure and safe and they should understand how
enterprise make use of it in order to offer personalised and better experience of shopping
(Bewayo, 2010).
Company make use of backup and recovery software in order to determine the needs and
requirements of customers regarding any service or product. Back up of customer's need will be
beneficial for a company as they will be able to know what kind of products or services are much
needed by customers. It also helps company to keep stock of much demanded products so at the
time when there is lack of supply regarding services and products. TESCO is one of the largest
retail company in UK and use various methods so as to for the need back up. This helps them to
avoid situation of out of stock (Mullins and Komisar, 2010).
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4. Research findings
TESCO, a multinational retailing company of food and has many stores all over world. In
order to get good understanding of their business idea, analysis of PESTLE is being done: Political factors: There are various political factors which influence company's
performance, which involves legislation act, country's stability in which they operate and
tax rates. Important part is being played by organisation in creation of employment
opportunities as well as increase demand of services and products. Economic factors: These factors are mainly concerned by enterprise as they covers
prices, profits, leverage cost and demand. Company must be aware of policies in regards
with change in taxation or other factors which will affect finance accessibility. Social factors: Due to various social changes, customer have move towards one-stop or
bulk shopping. Therefore, mentioned company make increase in amount of food items
which are offered for sale (Nunn and McGuire, 2010). Technological factors: Advancements in techniques bring various opportunities for
TESCO which includes introduction and development of online shopping with facilities
of home delivery and self service checkout point have given ease and convenience of
customers.
 Environmental factors: Company is committed to minimise carbon footprint by 50% till
2020 as well as they are reducing social conscience in customer.
Ansoff Matrix: Market Penetration: Organisation make entry in market with their advertising website
and promote themselves with leaflets and websites. New product and service: Company provide their consumers with mortgages, insurance,
saving schemes and credit card loans as well as work in order to increase food life. They
make introduction of biofuel instead of petrol and diesel. Market development: Company purchased C two network in June 2003 in japan and in
mid 2006, they purchased Casinos Leader supermarket which is situated in Poland which
is configured as TESCO' s small stores (Kwong,Thompson and Cheung, 2012).
 Diversification: Company make diversification of its business and extend it from food to
non-food products. They make diversification in areas like financial services to
customers, internet services, discount on clothes etc.
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(Source: https://image.slidesharecdn.com/ansoff-131221013458-phpapp01/95/ansoff-3-638.jpg?
cb=1387590016)
SWOT analysis
Strengths Weakness
 Leading position in UK
 Online operations are effective
 Strong portfolio of property
 Financial working is weak
 Reliance on market of UK
 Employee morale is diminished
Opportunities Threats
 International strategy for market
expansion can be pursued.
 Presence can be increased in financial
service industry (Mullins and Komisar,
2010). .
 Increase in non-food retail range.
 New leadership inability to turn over
business.
 Fluctuation in currency
 Emergence of ethics related problem.
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Illustration 1: Ansoff matrix

5. Positioning, segmentation and targeting
Segmentation is being done to diversify customers into four segments. TESCO make
segmentation of its customers as per their loyalty and by various types of club cards for various
products (Nunn and McGuire, 2010). Geographic segmentation: It divides market into geographical units like states, region,
nations, neighbourhoods etc. On the basis of it, TESCO serve their customers effectively. Demographic segmentation: It diversify market on the basis of demographic variables
like nationality, age, sex, income, family size, religion, race. Psycho-graphic segmentation: In this lifestyle and attitude of consumers are being taken
into consideration. Customer's general personality traits should be kept in mind while
make this segmentation.
 Behavioural segmentation: Marketers consider general behavioural pattern of customer
and forecast their reaction when marketing strategies will be adopted.
After the process of segmentation, choice of target market is being done by company.
Targeting is defined as the process used for the evaluation of attractiveness of market segment
and make selection one or more segment in order to enter. TESCO target all age and gender
customers of both rural and urban. On the basis of income they focus on middle and low income
category, easy going and determined customers (Tesco Segmentation, Targeting and Positioning.
2016).
Product positioning involves dealing with the particular elements of marketing mix so as
to attract segment of customer in effective manner. Enterprise make use of positioning strategies
so as to attract customer.
 Functional positioning: It is in association with increased quality and range of
functionalities of services and products. Tesco finest range of products are sold by
company with the support of functional strategy.
 Symbolic positioning: It is one the basis of aspiration and aims of customers. It is
used by company related with Fair trade range of products in grocery and food sector.
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 Price positioning: It is applied by company related to large range of own products.
They make involvement of price positioning so as to attract particular segment of
customer.
(Source:http://3.bp.blogspot.com/V7Zvf81AaIA/Uk9L7_iHQoI/AAAAAAAAANo/
KOZDNnZn6JM/s1600/STP.png)
6. Conclusion
From the above mentioned report, it can be concluded that business plan is one of the
significant need for any company in order to make development and growth in market. TESCO
has made plan to bring innovative and creative products for its customers by making proper
segmentation, targeting and positioning strategies. With the support of Ansoff, PESTEL and
SWOT company will be able to make proper strategies and will generate more and more
revenues.
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Illustration 2: Segmentation, targeting and positioning

REFERENCES
Books and Journals
McKeever, M., 2016. How to write a business plan. Nolo.
Fernández-Guerrero, R., Revuelto-Taboada, L. and Simón-Moya, V., 2012. The business plan as
a project: an evaluation of its predictive capability for business success. The Service
Industries Journal. 32(15). pp.2399-2420.
Kwong, C.C., Thompson, P. and Cheung, C.W., 2012. The effectiveness of social business plan
competitions in developing social and civic awareness and participation. Academy of
Management Learning & Education. 11(3). pp.324-348.
Bewayo, E.D., 2010. Pre-start-up preparations: why the business plan isn't always written. The
Entrepreneurial Executive. 15. p.9.
Mullins, J.W. and Komisar, R., 2010. A business plan? Or a journey to plan B?. MIT Sloan
management review. 51(3). p.1.
Nunn, L. and McGuire, B., 2010. The importance of a good business plan. Journal of Business &
Economics Research. 8(2). p.95.
Online
Tesco Segmentation, Targeting and Positioning. 2016. [Online]. Available
through:<http://research-methodology.net/tesco-segmentation-targeting-and-
positioning-2/>. [Accessed on 21st July 2017].
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