Tesco: International Business Strategies, Risks, and Opportunities

This report provides an analysis of Tesco's international business strategies, highlighting various factors influencing its global operations. It delves into international business concepts, emphasizing strategies such as value creation and low-cost approaches, and explores different market entry methods like exporting, licensing, and franchising. The report also examines the risks associated with international markets, utilizing PESTLE analysis to assess political, economic, social, technological, legal, and environmental factors affecting Tesco's international ventures. Strategic alliances and global web strategies are discussed as means for Tesco to gain a competitive advantage and increase revenue growth while managing costs and mitigating risks in the international business environment. Desklib offers a wide range of similar reports and study resources for students.

Organisational Report

Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................4
International business......................................................................................................................4
International strategies.....................................................................................................................6
Risks of international market...........................................................................................................8
REFERENCES..............................................................................................................................12

INTRODUCTION
International business is known as the trading outside the country boundary and this is head in
between two countries. As this also has the wide scope in business and this also operates in
various areas of management and this is also known s the cross border transaction and this can be
in between the government entities, individuals and two different business. AS there are different
types of business and this also focus on different areas in business and there are various factors
which can impact the business and there operations effectively and this can also make the
business and customer requirements on the top priority. As Tesco is an multination grocery and
this operates in two division and this is founded in 1919 and its headquarter is located in London.
As this report involves Various kind of international environment and there appropriate
techniques and the strategies for the management of business and this report also involve the risk
which is involved in the international trade.

TASK
International business
International business is an external trade and this is also an international trading as this is when
purchasing and selling of product and services are beyond the boundary of country and this can
make it an external trade. As international business has its nature of involving two countries
together in one way or another and this can make in various terms. As this also involves the
payment factors as in different countries there are different currency run and this can also allow
there country payment specified and this can also make the money medium related to there
country currency(Aguilera, and Grøgaard, 2019). As there are various problem that an international
business face as there are various restrictions as in some country some countries trade is banned
as due to Brexit the trade of UK in EU is banned and this has also decreased the economy of
business. As this also has legal purchases in the business which can impact in the business
activities and operations effectively and this can make the payments secured. This also has
various risk factors in business as there many language barriers which can impact the business as
countries has different language and this is required to arranged properly for better
communication in business(Cherunilam, 2020).
Business usually opt international business foe getting the clarity of there production services
and this can also ensures new techniques and strategies in the business and this also enhances
and build an effective productive plan in an business as this can also develop better abilities to
the business. As this is also done for expanding the business and increasing there profit rate and
better growth of business in an effective manner as this can also benefit the business in operating
with different risk and operational management as in Tesco, they provide basic grocery to the
society and if this will get expanded beyond the boundaries and this organisation will be getting
high rate of interest in business(Buckley, 2019). Organisation usually go to overseas as in the
expansion of business this is highly time consuming and takes a lot of cost in international
establishment. As this can also grow economically and this can also benefit the business in
relocating the resources and factors within the business. They also uses this for the low rate of
tax and this can benefit the business for reducing the cost of business. As by shifting the business
internationally and this also leads in better growth to the business and this can make it effective

and this can impact in launching the franchise and the subsidiary in the partnership with different
firms and can impact in the better growth of the business.
As there are various entry methods which can be used in the business and this can also give
better expansion to the business as exporting is one of the method and this can impact in the
direct sales of the business and this can target the audience and reduces the risk of entry by
limiting the cost and control in business as Tesco can follow this mode for getting the control
over distribution and the marketing sector as this can also increase the competitive position of
the business(Hannibal, and Knight, 2018). Licensing and franchising is also an another mode of
entry by overseas and this also contains limits legal and the financial risk. This also make the
business sustainable and this organisation can also sell there franchise and this can enhance the
profit of business and this also increases the responsibility of providing the same quality and
stuff at internal level.
As business usually select the business market expansion through the oversea as this can reduce
the risk of the business and this can also make the easy entry and with the low legal facilities as
this can help the business in an effective target in the market and this can also make the business
expanded the market and this also lead in increasing the profit rate of the business(Hamilton, and
Webster, 2018). As there are various ways and tools which are used for targeting the market and
this can help in making the better strategies with the use of cost and resources of business. As
Tesco has used Pestle for the analysation of the external and internal factors of business.
Political factors
As there are various factors which is imposed by the government and these are the policies which
can impact in the business activities. As this can impact in the business operations and this also
differ form different countries and there policies. As Brexit has impact din business and due tot
his prices has been increased and this has also impacted in the revenue rate of the business. As
due to the trade conflict in between China and US this has lead in high tax rate in the export and
import prices of business.
Economic factors
As these are the factors which can impact in the growth rate and pricing strategy of the business
and this can also impacted by pandemic as this has restricted the contact and caused the
shutdown of the stores and this is also making the business victim of Covid. As recession is also
impacting the business and this is leading an permanent shut to many business and this has also

decreased the growth rate of the business(Wulff, and Villadsen, 2020). As trade tariff has also
started in the business after Brexit as this has also increased the end cost of the business.
Social factors
As this can also impact in the business market growth and share and this can also impact ibn the
changing trends in business and this can also impact in the cultural and social trends and this can
also have to work according to the chafing factors and this can also be world according to the
changing requirements of business. As now a days people are following vegan food and healthy
diet and this is also making a change in the dishes and there ingredients. As there are also
cultural impact which can impact in the purchasing power od the customers and Tesco looks
after the changing trends of business and fulfil there requirements.
Technological factors
As there are various usage of technology and Tesco uses the latest technology for the better and
effective process and this can also make there payment effective and this can also enhance the
customer experience of the business. As this organisation has started on there website and this
has make them survive in Pandemic. As Tesco has also initiated there products for technology
and this has given better benefit to the business and this also saves the cost and time of the
customers.
Legal factors
As this also increases the regulations and this has impacted due to the government imposed laws
and this can also impact I the international laws(Zhao, Zhang, and Kwon, 2018). As Tesco is the
high competitive business and this can also violates the past. As this organization also dose
discrimination as they have different pay scales for female and male and this has increased the
credibility of the organisation. As this organisation has also failed one case and that was fraud.
Environmental factors
As this organisation has there recycled plan and this can also recycle and the reduction of plastic
in an organisation and this has also decreased the profit of business and this cleans the
environment of business. As this organisation is also sustainable as this organisation uses best
practices in the business and this can also help the business and this can also give better
advantage.

International strategies
There are various international strategies which can be used by Tesco and gain competitive
advantage in the business and this can also lead in increasing the revenue growth and profit of
the business. As value creation is the strategy which can be applied in the better use of the
business as this can also increase the rate of profit in business as this can creates the value of
product and services and this can also make the better segmented supply if the customers and this
can also develop the better output on the business and this also reduces the production cost of the
business and this can also develop the better understanding of the business(Chow, and
Schoenbaum, 2020). As this also leads in increasing the profit of the business and this can also
reduce the cost of the business. As low cost strategy is used by Tesco at the international level as
this can focus on the primary cost of the business and later can increase the costing of the
products and this is one for developing the customer base of the business effectively. As after
this strategic positioning is important in the business and this can also make the change in the
business and this can also make the internal operations successful and this can also be done for
the long run and this also allows high rate of interest in business. As this also leads in high
integration power of the business and this also leads in high structure to execute the strategy of
business. As firm can make the better support to the activities of the business and this can also
influence the research and development and this can also involve the production process of
business which can impact in the new creation. As marketing and sales are the important factor
of the business and this can also make an effective communication and this also lead in high
customer service to the customers. As there are various support activities are like logistic as this
is an transmission of the value chain and this can help the business in gaining various advantages
of different operational functions and this can increase the organisational culture and make the
better inventory to the business(Laplume, 2018). As this can be implemented the strategy as
according to the external and internal factors of business and this can also be based on the
organisational structure, control system, process and organisational culture. As this also gives an
global expansion and this can also lead in increasing the level of profit and this can also make the
cost of the business effectively and this can also make things valuable and effective for the other
operations and this can increase the level of productivity in business. As for this global web is
also done in different stages in business and this can also impact in the value chain of business
and can make the creation of value effectively. As this also leads in giving an competitive

advantage to the business. As there are various external cost which can impact in the business
and these are transportation and the economical cost and this can also create an trade barrier to
the business and this also increases the risk of business(Maude, 2020). Strategic alliance is also
giving an cooperative agreement in the actual competitors and this also has various advantages
and disadvantages as this can facilitate the market of the business and this also allows the
organisation to work better and those can also make the effective use of skill set and builds the
standard of living and this can also increase the revenue growth in the business effectively.
Risks of international market
There are various risk in international business and this can occur due to the international trade
of business and this can also reduce the revenue growth and profit of the business.
Foreign exchange rate
AS this is the major risk faced by the business as this is known as the value of the investment and
this can also lead in better change in the currency and this can risk the business. As this risk can
also impact in the business and this is impacting in the business profit and this can not make the
domestic currency work in the business and this decrease the profit rate of the business and this
can also make the protect difficult in the business(Takino, 2020). As Tesco is sealing
internationally but every tomes faces this risk even after the appliance of the strategies as this can
also make the operations better in business.
Global issues
As there are various global ethical issues which can impact in the business and this can lead to
the change in the management and this can also impact in the business activities and this has also
impacted in the huge part of Tesco. As discrimination is the main factors of with or outside the
organisation as Tesco discriminates in the salary of men and women as this has made an change
in the busyness and this there are various laws in UK and this discriminates in the promotional
decisions, hiring and in the basis of race. As this discrimination has embedded in various
countries.
Bribery
As this is the important risk of the business as this also facilities the business and there payments
according to the different culture of the business and this can also make at global level as in
performing the international work an organisation is required to give bribery for getting the work

or trade done in the international market and these kind of payments is prohibitions in the US
laws(Gereffi, 2019). As this can caused by lack in the training sessions an monitoring the power of
business. This can also be caused by political and economical involvement in the decision
making process and with developing an competitive rivalry in the global market.
Telecommunication issues
These issues are also considered as the major issue in the market as this can lead in reducing the
goodwill and image of Tesco as someone can copy there ingredients and supply chain
management for developing there own which can reduce in there laws and this can also get
impacted due to the management of business(Yan, Hu, and Liu, 2020). As if the business do not
have the copyrights to there products and services they can also split in the international market
by other brands and this can make them profit and this is copied by advertising the brands of
different organization and after trading if organisation is not having an copyright of patent to
their organisational product can reduce the business profit.
Shipping risk
As this is also the important factor and risk which si faced by Tesco and this has also lead the
business switching to the online marketplace as this can also lead in connecting the buyer to the
suppliers and this also has required a high cost foe shipping it one country to another as this can
also make different changes in business and this can also increase the risk of business and can
also lead in reducing there profit(Bolwijn, Casella, and Zhan, 2018). As this shipping cost involves
the relatable risk to the contaminations, accidents, theft, breakage, seizure, vandalism and loss of
the business products. As by this organisation also faces the financial losses in business and this
can create an major issue to the business and this can also biding with rules and policies by
which this can not be changed to focus on the business functions and activities.
Settlement risk
AS these are also the risk which can impact in the business and there operations as this can effect
the business and there operations and this can also lead in change and loss to the business and
revenue growth and market share of the business(Buccieri, Javalgi, and Cavusgil, 2020). As Tesco is
also facing this risk and this also make the difference and this can also make the difference in
the cash flow of the business. This also involves various risk in the business as this can also
make the ability to build the business and these risk also impact in the business and this can also
make various problems in the business and this can fluctuate the loss and profit of the business at

high level. As this can also impact in the fluctuation in the distribution in the financial risk of the
business and this can also impact in the better benefit of the business.
Project risk
As this is also an important risk faced by business by using the international business as a risk as
with the establishment of new and big projects as this can also make the change in the
exploration and can impact in the loss of huge investments in business and this can increase the
risk of business as this enhances the risk and waste the long investment and can decrease the
profit rate of business(Map, 2019). As this can also be imposed by the governmanet as if it seizes
any property or franchise for the business and this can also increase the engagement of the
business. As this can also lead in changing situation sand the performance level of the business.

CONCLUSION
This report has concluded that international business is important for the better expansion and
growth and this can lead to the better advantage and increases the performance level and
knowledge and skills of employees as well as business as this leads in high profit rate and growth
rate of business. This report has also concluded that by expansion the business internationally
organisation is required to make some strategies with the use of tools and this can leas in the
management of business. As this report has also concluded that organization also faces many risk
and Also get some loss in expansion there market at global level and this can also make the
international trade risky.

REFERENCES
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