Tesco's Challenges and Strategies

This assignment delves into the challenges confronting Tesco within the dynamic retail landscape. It examines issues such as adapting to multi-channel retailing, managing showrooming, and implementing effective human resource strategies to overcome these hurdles. The analysis explores current industry trends and suggests potential solutions for Tesco to navigate the future of retail successfully.

CONTEMPORARY
THEMES

TABLE OF CONTENTS
REASERCH TITLE ........................................................................................................................3
TASK 1 RESEARCH PROPOSAL.................................................................................................3
Research title...............................................................................................................................3
Aim .............................................................................................................................................3
Rationale of research project.......................................................................................................3
Literature review.........................................................................................................................4
Introduction.................................................................................................................................4
Methodology...............................................................................................................................5
Time plan ...................................................................................................................................5
Findings and analysis..................................................................................................................6
Conclusion...................................................................................................................................6
TASK 2 LITERATURE REVIEW..................................................................................................7
Research title...............................................................................................................................7
Aim..............................................................................................................................................7
Rationale of research project ......................................................................................................7
Literature review ........................................................................................................................7
Introduction ................................................................................................................................9
TASK 3 METHODOLOGY............................................................................................................9
Techniques and Procedures ........................................................................................................9
Timeline (Action plan and Gantt Chart) ..................................................................................10
Data analysis ............................................................................................................................13
TASK 4 FINDINGS AND ANALYSIS........................................................................................20
Conclusion ...............................................................................................................................20
Recommendations.....................................................................................................................21
REFERENCES..............................................................................................................................22

REASERCH TITLE
“Contemporary and future challenges in retail sector of UK- A study on Tesco”.
TASK 1 RESEARCH PROPOSAL
Research title
“To critically assess the current and future challenges in retail sector of UK- A study on Tesco”.
Aim
“To critically analyse the present and future challenges in the retail industry of UK in context of
Tesco”
Rationale of research project
The retail industry of UK plays a vital role in its economy as in 2015 this sector produced £340
billion sales. The retail industry is the largest private industry covering businesses which sells
goods to the general public. This includes businesses such as department stores, independent
stores and virtual stores. This sector provides employment to over 10 percent of UK workforce.
The contribution of retail sector in tax is about £ 17.5 billion. This sector leads to innovation.
The factors which are reshaping the purchasing experiences around the world are E-commerce
and the self services. The share of UK's retail industry in the global internet retail sales is 11
percent and it is having highest expenditure per person for E-commerce of any nation (Walker
and Jones, 2012). The International brands of UK attract internal investments and it has given the
tag of “shopping capital” to London all over the world. But despite of these facts about retail
industry, there are some challenges which are faced in the present and future also. Tesco Plc is
one of the British Multinational grocery and general merchandise retail firm which operates in
the retail sector of UK. Originally, it was a grocery retail firm in UK but then it diversified
geographically into areas like, clothes, electronic items, furniture, toys, financial services,
telecoms and internet services, retailing of books, petrol and software. Thus, the rationale behind
this research project is to identify and analyse the current and future challenges which can make
a significant impact on Tesco.
Research objectives:
 To identify the present issues faced in retail industry of UK with reference to Tesco

 To evaluate the future challenges in retail industry of UK in context of Tesco
 To recommend some strategies to overcome current and future challenges in retail
industry
Literature review
Present issues faced in retail industry of UK with reference to Tesco
In accordance to the view of Nickson and et. al., (2012) in the current context, some of the major
challenges faced by the retail industry of UK are multi-channel retail, mobile shopping, and
giving business flexibility. The first challenge of multi-channel retail states that it is not adequate
for the business firms to operate with a single channel for marketing. Smartphone and tablets
facilitates the customers to buy products and services at any time from any store which they
want. . Second challenge is the mobile shoppers. Patrons are developing the practice of checking
prices of rivals firms online when they visit any shop. This practice is named as “showrooming”
which is increasingly becoming popular and thus it is causing traditional retail firms lot of
tension. Goworek and et. al. (2012) asserted that in-store experience and customer services have
a major role in attitudes of consumers in showrooming. Majority of patrons prefer shopping by
using mobile. The issue is that if the consumers do not get the product they get dissatisfied from
the services. The third contemporary issue faced by the retail firms in UK are business
flexibility. To adapt to an evolving marketplace, businesses needs to bring more flexibility in
their business practices.
Introduction
The retail sector of UK is the largest private industry which covers business organisations
that sells products and services to consumers. Businesses such as large chains, department stores,
independent stores and virtual stores come under the retail industry. Retailing is the procedure of
selling consumer goods and services to patrons via multiple distribution channels for earning
profits (Piotrowicz and Cuthbertson, 2014.). The present research project is based upon
challenges in the present and future context of UK with reference to Tesco. The purpose behind
this investigation is to analyse these issues which are affecting operations of the chosen retail
company. These challenges can be multi-channel retail, business flexibility and mobile
purchasing. Apart from these challenges, there are more challenges such as management of
change, complexity and risk, enhancement of collaboration, cross functional working and
customer experience and many more.

Methodology
Research methodology is a way in which outcomes of research in context of the specific
problem are examined. In this, there are several methods which support the organisation to attain
goals and objectives. In the current research, scholar is preferring to take use of descriptive
research design. Also, research philosophy of Interpretivism will be preferred by the investigator
in this study. Along with this, inductive research approach will be taken for analysing the topic
of the report (Mackenzie Tan Hoverman and Baldwin, 2012) Furthermore, data collection will be
done by using primary data as well as secondary data. In the end, it will be analysed by using
qualitative techniques under which thematic analysis will be preferred b y the researcher.
Time plan
Key Activities
Week
1
Week
2 & 3
Week4 Week
5
Week
6
Week
7
Week
8 & 9
Week 10 Week 11
Preparation of
Introduction
Literature Review
Collection of
Secondary
Information
Examination of the
Collected Data

Research Design
Research
Methodology
Acquiring Primary
Data
Analysing Primary
and Secondary
Data
Conclusion and
Recommendations
Completion of
Leftover Work
Revision and Draft
Final Submission
Findings and analysis
From the above research proposal, it has been found that retail sector of UK is a
flourishing industry and has a major contribution in its economy. But there are some challenges
which are being analysed that the retail firms are facing in the present context as well as for
future. These challenges can make a significant affect on operations of Tesco company also.

Conclusion
From the aforementioned proposal, it has been concluded that retail sector in United
Kingdom is witnessing several challenges such as mobile shoppers, flexibility in businesses,
change and risk management, customers experience etc. It has been assessed that these
challenges makes long term affect on the operations and functioning of chosen retail firm Tesco.
TASK 2 LITERATURE REVIEW
Research title
“To conduct a critical assessment of the current and future challenges in retail sector of UK- A
study on Tesco”.
Aim
“To critically analyse the present day and future challenges in retail industry of UK in context of
Tesco”
Rationale of research project
The present investigation is prepared to identify and analyse certain present and future
challenges which makes their significant impact on retail industry of UK with specific context of
Tesco. The industry is facing immense pressure from past few years due to number of reasons
which includes growth and evolution of supermarkets, online retailing and recession. With
increasing competitive market, retail firms such as Tesco have to face competition for providing
best customers services (Leask Fyall and Barron, 2013). Customers desire for set of personal
services of traditional retailing and convenience of taking use of technology. Thus, chosen firm
has to strive for providing seamless buying experience.
Literature review
Present issues faced in retail industry of UK with reference to Tesco
According to the views of Haskel and Sadun, (2012) it is no longer enough for retail
firms to function with only a single market. Smartphones and tablets have given the facility of
buying good and services from any place at any time from anybody. Nevertheless, for the
purpose of future oriented business, execution of a system which unites all retail channels is a
good way to invest. Also the increasing habit of checking prices of competitors online when they
pay a visit to a store is increasingly becoming famous and thus the traditional retailers are
concerned about it. Baud and Durand, (2012) stated that other challenge faced by retailers is to

manage change, complexity and risks. Change is responsible for success in retail sector. Whether
changes can be for merger and acquisition, supply chain management, emphasising on customers
and demographic trends, grasping omni channel, adopting mobile shopping or bringing more
flexibility in business process. Also business flexibility is one of the significant challenge which
means that a business needs to introduce more flexibility in the business process to adapt to
evolving marketplace. For example, the only method to contend patrons demands for omni-
channel services is to become flexible in the manner that they communicate with them to give
them a consistent experience.
Piotrowicz and Cuthbertson, (2014 ) asserted that retention and acquisition of customers is also a
problems for retailers. This is not a new issue for retail firms, but the solutions have transformed
in a dramatic manner and will continue with the same. In the past times, it was simple and easy
to gain customers if a firm was having a budget, most outstanding outlets and effective
advertising space. Loeb, (2016) argued that if the goods and services were best and desirable, a
firm would have patrons. This approach is still present in online which is known as Paid Search
and it does works without any question mark. In the coming future, firms will focus on attracting
new consumers and most necessarily to make them interact with potential new customers. Retail
firms will need to consistently evolve and update content marketing and PR strategies which
matches with their customers and their brand.
Future challenges in retail industry of UK in context of Tesco
According to the view of Fernie and Sparks, (2014) there are some future challenges
which retail firms may have to face in the near future. These needs to be focused as these
challenges will make their impact on operations and profitability of businesses. The pressures of
cost, increasing inflation rates and steady wage growth can affects confidence of patrons and
thus reduce demand. Retail firms have to satisfy with current disturbance from the next waves of
digital technology and thus they are required to prioritise investment in technology which can
actually add value for consumers or make an increase their operations with efficiency. In the
future years, retail firms have to pay attention on managing change in their businesses.
Hristov and Reynolds, ( 2015) quoted that to understand the global supply chain is also a
challenge for retailers in UK. However. The managerial impacts of global supply chains should
be understood in a better manner by the industry. Also firms will require good employees to sell
the products and services. This challenge will rise due to impact of high cost taking place from

national living wage and apprenticeship levy. Those firms will win who do not lose trust and
confidence in their workforce. Along with this, economical conditions will observe a pressures
on cost and margin because the exchange rates will continuously fluctuate. The current review of
business rates and affect of upward only rent reviews will be also affecting retail organisations.
Wittman Beckie and Hergesheimer, (2012) said that customers journey will get shifted from
becoming a “nice to do” to first priority. Retail companies will have to review and enhance the
whole customer experience. Culture of firm is an essential variable and it will be a challenge for
multi-brand retail organisations in which labels does not control consumer proposition. Apart
from these challenges, crisis management is also one significant challenge for retailers. Ranging
from warehousing problems to corporate governance failures, during past year leading retail
companies spent their most of time in press with wrong reasons. In the future years, they have to
think about this approach.
Introduction
Retail industry of United Kingdom is the largest sector which covers those business
which sells goods and services to patrons. Businesses like large chains, virtual stores, department
stores ad independent stores fall in the category of retail sector. In global internet retail sales is
the share of UK's retail industry is 11 percent and it is having highest spend per person for E-
commerce of any nation. This investigation is prepared to study current and future challenges of
retailers in UK in context of UK. The intention for this research is to critically assess the issues
which are making implications on the operations of quoted retail organisation. These issues are
change management, risk management, mobile shopping, cross functional working and
customers experiences.
TASK 3 METHODOLOGY
Techniques and Procedures
Research design is a kind of plan which is utilised for research problems and their
solutions. They provides a direction and systematic process to conduct a research. In this section,
investigator takes help of numerous methods of study for critical assessment of current and
future challenges in retail sector of UK with particular reference to Tesco. Research design is
also comprising of specific grounds for selection of research methods and designs to examine the
problems of investigation.

 Research approaches: Approaches are the ways for developing new hypothesis and
understanding for increasing the overall understanding of entire investigation. There are
mainly two kind of research approaches which are called as Deductive research approach
and Inductive research approach. Inductive approach are utilised to design new theories
and qualitative research technique is taken in use for this approach (Mackenzie Tan
Hoverman and Baldwin, 2012) On the contrary, deductive research approach is applied
to test the current theory with reference to research. In the present research study,
inductive research approach is preferred by investigator as it supports the assessment of
solutions of research problems.
 Data collection: Data collection is a method of assembling and evaluating data and
information which is gathered from numerous sources to achieve aims and objectives of
the research. The two methods of data collection are primary data and secondary data.
Primary data is of original nature and does not undergoes with any kind of statistical
methods (Wildemuth, 2016). The main sources in primary data consists of interviews,
direct observation, surveys, focus groups etc. on the other hand, secondary data is that
type of data which is gathered and utilised by some other person with his own purpose.
In the present research, investigator has preferred for primary as well as secondary data. Data analysis: This is a method of applying numerous statistical and logical techniques
that are taken in use for gathering data and information. Data analysis provides direction
to collect data for future as well as addresses research questions. With the support of this,
researcher can transform data into knowledgeable form and it defines relationship
betwixt several research factors (Cozby and Bates, 2015). In the current investigation,
scholar has given preference to thematic analysis due to a simple reason that it gives
flexibility to scholar for using numerous theories. To evaluate a large sample, this kind
of analysis is most suitable.
 Sampling: Sampling is that technique in which selected units from a given population
are taken as a sample. In the present study, investigator has taken 10 employees of Tesco
as sample who are given a set of questionnaire to gain primary information from them.
This will give equal chances to employees of quoted firm to take part in the investigation
(Groenewold and Lessard-Phillips, 2012).

Timeline (Action plan and Gantt Chart)

Data analysis
Theme 1: Majority of respondents have agree that there are some challenges in the retail
sector
1) Do you feel that retail industry is facing certain challenges in the present business
scenario?
Agree 5
Disagree 1
Strongly agree 3
Strongly disagree 1
10
Interpretation:
From the aforementioned data, it is being analysed that most of the employees working in Tesco
feels that retail sector in UK is facing certain challenges in the current business scenario. Out of
ten respondents, five of them have agreed to it and three of them are strongly agreeing on this
fact. Three of them were denying that there are some challenges while only one them had
strongly disagreed to it. This depicts that majority of staff feels that retail industry is facing some
challenges and Tesco is also getting affected by these challenges.
5
1
3
1
Agree
Disagree
Strongly agree
Strongly disagree

Theme 2:Most of the employees agreed to the fact that retail sector of UK is going to face
certain challenges in coming future
2) Do you think that in the future, retail industry will be facing some
significant challenges which may impact on its operations and profitability?
Yes 6
No 3
Can't say 1
10
Interpretation:With the above stated data, it is interpreted that a clear majority of employees
accept that retail sector will be facing certain challenges in the emerging future years. Out of ten
respondents, six of them agreed with this, while three of them refused with this fact. Only one
respondent was not able to say anything on this issue. This showcases that majority of employees
working in Tesco are aware that the retail firm is going to face some issues which will influence
profitability and operations.
6
3
1
Yes
No
Can's say

Theme 3:Most of the employees of Tesco accepts that mobile shopping is the current issue
faced by their company
3) In your opinion, what are the current issues which are faced by Tesco?
Multi-channel retail 2
Mobile shoppers 4
Business flexibility 1
Customer acquisition and retention 3
10
Interpretation:With the aforementioned data, it is analysed that most of respondents had a
viewpoint that Tesco is facing issue of mobile shopping. Out of ten employees, four had
responded that mobile shopper are a main challeng for quoted firm. While, three of them had
also given importance to customer acquisition and retention. Two out of ten respondent had
opined that multi-channel retailing is a issues for chosen organisation while only one of them
paid focus to business flexibility. This depicts that workforce of Tesco is more concerned about
challenge of mobile shoppers and then they give importance to customer acquisition and
retention.
Multi-channel
retail
Mobile shoppers Business
flexibility
Customer
acquisition and
retention
0
1
2
3
4
2
4
1
3
Series1

Theme 4: Clear majority of respondents had opined that economical conditions are the major
future challenge for Tesco
4) What kind of future challenges may be faced by Tesco?
Managing change 3
Economical conditions 5
Crisis management 2
10
Interpretation:With the above stated data, it is analysed that most of the respondents had a
viewpoint that the emerging challenge in the future would be Economical conditions for Tesco.
Three out of ten employees viewed that change management will be a significance challenge for
chosen organisation while two of them had a thought that crisis management will be the most
affecting challenge for Tesco in the coming future. This shows that employees give more
attention on economical conditions as they will pose a challenge or may be threat to the cited
company in the emerging future.
Managing change Economical
conditions
Crisis management
0
1
2
3
4
5
6
3
5
2
Series1

Theme 5: Majority of employees gave emphasis on digitally enable store in Tesco to handle the
problem of showrooming
5)What are the ways to deal with the threat of showrooming?
Digitally enabled store 5
Launching an app or mobile site 3
Provide free Wi-Fi 2
10
Interpretation: With the above mentioned data, a clear majority of employees had a viewpoint
that to deal with showrooming, the best way is to bring digitally enable store. Out of ten
respondents, three had a distinct opinion about this issue. They had opined that launching an app
or mobile site will be a better way to handle with the problem of showrooming. While two out of
ten had responded that provision of free Wi-Fi in outlets of Tesco will be more suitable to deal
with the issue. This shows that most of the employees agree that digitally enabled stores would
be a good option to resolve the problems of showrooming in Tesco.
Launching an app or mobile site
0 1 2 3 4 5 6
5
3
2
Series1

Theme 6: A clear majority of employees viewed that the most appropriate strategy to overcome
the challenges is to offer unique products
6) What strategies do you suggest to overcome these challenges?
Offer unique products 5
Creating digital shopping experiences 3
Improvement in efficiency, time and speed of delivery 2
10
Interpretation:With the aforementioned data, it is interpreted that employees of Tesco feels that
the best strategy to overcome these challenges is to provide unique products and services to their
customers. Out of ten respondents, three of them had a viewpoint that through creation of digital
shopping experiences, these challenges can be minimised. Whereas, two of them had viewed that
through improvement in in efficiencies, time and speed in delivering products and services can
help to overcomes these challenges. This showcases that majority of employees like to focus on
offering unique and out-of-box products and services to patrons of Tesco so that the affects
current and future challenges can be reduced.
5
3
2
Offer unique products
Creating digital shopping
experiences
Improvement in efficiency,
time and speed of delivery

Theme 7: Most of the employees agreed to the fact that Tesco should bring changes in training
and career development practice to overcome the challenges of retail sector.
7)In your viewpoint, what changes Tesco should make in its Human resource
practices to overcome these challenges?
Flexible working 3
Training and career development 4
Management of shop floor employees 2
Remuneration 1
10
Interpretation:With the above stated data, it is analysed that most of the employees i.e. four out
ten thinks that Tesco should bring modifications in its training and career development practices
and policies to overcome the challenges of retail industry. While three of them thinks that
flexible working approaches are a good strategy to face the challenges. Two out of ten had
viewed that management of shop floor employees is suitable for overcoming the challenges. One
of them had opined that remuneration is the key strategy to face the challenges.
3
4
2
1
Flexible working
Training and career
development
Management of shop floor
employees
Remuneration

Theme 8:Majority of respondents agrees that Tesco will have advantage of greater
opportunities to recruit best individual if changes in HR policies are done
8) What kind of benefits will changes in HR policies and practices will give to
Tesco?
Creating a lean and more adaptable workforce 1
Opportunities to hire best individual 5
More consumer oriented firm 4
10
Interpretation:From the aforementioned data, it is interpreted that most of employees accepted if
Tesco brings changes in it HR policies and practices, then it will reap benefit of increased
opportunities to hire best workforce. Out of ten respondents, four viewed that it will become
more consumer oriented while one had opined that it will create a lean and more adaptable
workforce.
Creating a lean and
more adaptable
workforce
Opportunities to hire
best individual
More consumer
oriented
0
1
2
3
4
5
6
1
5
4
Series1

TASK 4 FINDINGS AND ANALYSIS
Conclusion
From the above study it can be concluded that retail firms are facing some serious
challenges in present business scenario and there are some emerging challenges in the future
also. The future challenges are very difficult to anticipate and thus firms should be ready and
prepared with the affects of these challenges. However, from the above investigation, it is
observed that to handle the contemporary challenges is also not an easy job. Retailers have to
constantly upgrade their technologies and keep a close look on the current trends of retail sector.
Recommendations
To overcome the contemporary and future challenges of retail sector here are few
recommendations to Tesco:
 It is advisable to quoted company that it should consider multi-channel retail, business
flexibility as a major challenge and should not only emphasise on challenges such as
customer acquisition and mobile shopper as a major issue.
 It is recommended to cited organisation that is should pay attention on future challenges
of change management and managing crisis instead of just concerning about economical
conditions.
 This is suggested to chosen firm that it should focus on strategies such as creating digital
shopping experience for customers and bring betterment in efficiencies, time and speed
of delivering goods and customers to face the challenges in retail sector of UK.
 The quoted organisation is advised to launch a mobile site or an app to deal with the
threat of showrooming. It can also go for providing free Wi-Fi in its outlets. These
methods will be very helpful for the firm to to handle the problem of showrooming.
 Tesco is suggested to bring some modifications in the HR polices and practices regarding
flexible working approaches, managing shop floor staff and remuneration issues. These
changes will produce some effective outcomes for the organisation which will be helpful
for it to overcome the challenges in retail sector of UK.
 Apart from these suggestions, cited organisation is recommended to align its offline
customers data and online customer data. This will provide the firm a complete 360
degree view of its patron's purchasing preferences, desires and wants.

REFERENCES
Books and Journals
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challenges in the retail supply chain. Kogan Page Publishers.
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Haskel, J. and Sadun, R., 2012. Regulation and UK retailing productivity: evidence from
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Hristov, L. and Reynolds, J., 2015. Perceptions and practices of innovation in retailing:
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Leask, A., Fyall, A. and Barron, P., 2013. Generation Y: opportunity or challenge–strategies to
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Walker, H. and Jones, N., 2012. Sustainable supply chain management across the UK private
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Online
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