Retail Sector: Trends, Analysis, and Recommendations for Tesco

This research report focuses on the retail sector, specifically analyzing the trends in the industry and providing recommendations for Tesco. It explores the importance of staying up-to-date with the latest trends and innovations in order to achieve goals and objectives effectively and efficiently. The report also includes an analysis of Tesco's performance and primary data collection through questionnaires.

Research Report

Executive Summary
Retail Sector is one of the most fast-growing sectors in the economy. This sector has
enormous opportunities for the different players in the market. Thus in this way the companies
which are operating in this sector are required to make sure that they can manage their work in
the right manner. Thus in this way this sector ensures that the use of these opportunities is made
by different companies effectively and efficiently. Thus it is important for the companies which
are operating in it to make sure that they stay highly up-to-date with the change in the latest
trends and therefore are able to achieve the goals and objectives set in the future effectively and
efficiently.

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Trends in retail industry...............................................................................................................1
Analysis of the organization........................................................................................................2
Primary Data Collection..............................................................................................................4
Recommendations for the company.............................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Retail Sector is one of the fastest growing sectors in the different economies all over the
world. Therefore this sector includes the different types of products which are provided to the
various customers in the world (de Vass, Shee and Miah, 2020). The Retail Sector in U.K.
Consists of different companies such as Tesco, Sainsbury's, Asda, Aldi etc. For this research
report, Tesco has been considered. It is a British Company dealing in providing of groceries and
several other related products and services to the various customers in the market. In this
assignment, a detailed focus will be made on Modern trends in retail, Analysis, Primary Data
Collection through the use of Questionnaire. Additionally, a detailed discussion related to the
Recommendations for the company will be discussed as a part of the project.
MAIN BODY
Trends in retail industry
The retail industry is a very dynamic industry in which there are different types of trends
which can come up regularly (Dixon-O’Mara and Ryan, 2018). Therefore it is quite important
for the organizations which are operating in this industry to make sure that they are able to
identify these trends quickly and therefore make sure that they can adjust effectively and
efficiently to these trends. One of these trends is Cost pressures rising.
This trend has taken place because of increase in the level of costs which has thus put an
enormous pressure on the industry (Filimonau and Gherbin, 2017). Therefore in this way the
organizations like Tesco have seen an increase in their overall level of costs due to which they
had to increase the prices of their different products so that the level of profits can be covered up
without problems and issues. The prospective solution for this problem can be Investing in
innovation.
Investing in innovation means that the companies operating under the retail sector have to
make sure that they have to regularly make use of innovative approaches, techniques and
methods so that they are able to innovate in the right manner. (Jaravel, 2019). Therefore when
the companies invest in innovation this can help a lot in ensuring that the overall goals and
objectives can be attained. Therefore Tesco is required to make sure that the use of innovation is
made correctly because in this way the company will be able to ensure that it can put the impact
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of increase in the level of costs away and ensure that the particular goals and objectives can be
attained in the future.
Furthermore, the last few years have also seen a rise in the digital trends in this industry.
These trends like Drone Delivery for the products, Rise of the use of online shopping etc. Drone
Delivery of the products is the digital trend in which the consumers will order the goods on the
mobile application and the goods be delivered to them through the use of Drone. Online
shopping is a trend in which the consumers order their goods online so that they can receive
them at their convenience. This trend has picked up pace because of the availability of online
sites 24 * 7 for the consumers.
Therefore it can be said that the retail industry in U.K. Has a lot of potential and therefore
will be able to ensure that it can contribute a lot to the increase in GDP growth of the economy in
the future (Kjellberg, Hagberg and Cochoy, 2019). Thus it is essential for the retailers in U.K. To
stay focused and therefore make sure that the attainment of goals and objectives can be done
effectively and efficiently.
Retail Industry Analysis in U.K.-
The Retail Industry has a significant share in the market of different countries. In U.K.
Also, it has a particular share in the market. Some of the main points regarding this industry are
explained as follows-
 In September 2020, the retail sales increased by 1.5% when compared with August.
Therefore in this way it can be said that the retail sector has witnessed a recovery after
the impact which was created by the COVID-19 pandemic (Mohr and Batsakis, 2018).
 The proportion of the online sales was 27.5% as compared to 20.1% in February. This
means that the people are preferring online mode of shopping as their preferred shopping
mode as compared to offline mode of shopping due to the impact which has been created
by the COVID-19 pandemic.
Analysis of the organization
External analysis of the organization can be done by ensuring that the use of the different
types of models can be made in the right manner to obtain the desired conclusions as well as
recommendations (Nash, 2019). Thus for this purpose the use of Porter's 5 forces will be made.
Porter's 5 forces-
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 Competition in the industry- This refers to the power of a force regarding the level of
competition within the industry. In the context of Tesco, it has a high power because in
the retail sector a lot of competition is present which can therefore lead towards the
organization having to adjust effectively accordingly.
 Potential of new entrants- This means the force generated by the new entrants within
the organization. In Tesco, this has a high power because the retail industry has a lot of
scope for the new players in the market which can thus force the company to consider
reducing the prices to match the level of competition.
 Power of suppliers- This refers to the force which is created by the suppliers in the
market. In the context of Tesco, this force has a low power because the retail market has
a presence of lot of retailers and thus no particular supplier is able to exert monopoly in
the market.
 Power of customers- This means the force which is created by the different customers in
the market. For Tesco, this force has a high power because the customers in the market
can influence the prices which are set by the company.
 Threat of substitutes- This refers to the force which is created by the influence of
substitute products in the market. In the context of Tesco, this force has a high power
because the customers can shift towards these goods if they find out that the branded
products of the company are priced higher.
For the purpose of carrying out Internal analysis the organizations can make use of different
types of models (Oliveira and Ramos, 2019). One of them is SWOT analysis. The analysis in the
context of Tesco is as follows-
SWOT analysis
Strengths Weaknesses
 Tesco is a company which has a large
customer base which can be targeted so
that the enhancement of overall profits
can be made by the company.
 Tesco makes the use of Creativity and
Innovation which lets it provide the
different types of goods to the
 Tesco is weak in the execution of some
of the marketing strategies which are
framed by it and therefore in this way
this can create different types of
difficulties for the company.
 There has been an increase in the
overall costs of the company which
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customers which can ensure a higher-
level of satisfaction for them.
therefore leads towards a decrease in
the overall level of profits.
Opportunities Threats
 Tesco has to make sure that the use of
opportunity of expanding in different
countries in the world can be made to
enhance the profits in the future.
 Tesco has to ensure that the opportunity
of aggressive marketing strategies is
made so that the different types of
customers can be targeted.
 Tesco faces threat from the higher-
level of competition which is present in
the market which can create an impact
on the overall level of profits of the
company.
 Tesco faces a threat from the increase
in the overall tax rates which are not
only increasing the costs but also
leading towards a decrease in the
overall level of profits.
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Primary Data Collection
Primary Data Collection can be done by the different organizations by making the use of
different types of methods (Roy and et.al., 2018). The use of Questionnaires, Surveys etc. can be
made for this purpose. Questionnaires will be used by Tesco to gather primary data-
Questionnaire
Question 1- Do you think that Tesco offers the branded products which are required by you for
your different types of needs and requirements?
Answer-
Yes- 12
No- 8
Interpretation- 12 out of 20 respondents state that Tesco is a company which offers them
branded products. The remaining 8 respondents state that Tesco does not offers them branded
products.
Question 2- Do you think that the products provided by Tesco are good in the quality which
they offer to the different types of customers?
5
1 2
0
2
4
6
8
10
12
14
Column A

Answer-
Yes- 14
No- 6
Interpretation- 14 out of 20 respondents state that the products which are provided by Tesco to
its customers are good in quality. The remaining 6 respondents state that the products of Tesco
are not so good in quality.
Question 3- Do you think that Tesco is good in adapting effectively to the Innovation in the
market?
Answer-
Yes- 16
No- 4
6
1 2
0
2
4
6
8
10
12
14
16
Column A

Interpretation- 16 out of 20 respondents think that Tesco is good in adaptation towards
Innovation in the market. The remaining 4 out of 20 respondents state that Tesco is not good in
adaptation towards Innovation in the market.
Question 4- Do you think that Tesco is efficient in the adaptation of new innovations?
Answer-
Yes- 18
No- 2
Interpretation- 18 out of 20 respondents think that Tesco is efficient in adaptation of new
innovations in the market. The remaining 2 respondents think that Tesco is not efficient in
7
1 2
0
2
4
6
8
10
12
14
16
18
Column A
1 2
0
2
4
6
8
10
12
14
16
18
20
Column A

adaptation to new innovations in the market.
Question 5- Does Tesco brings out promotional schemes for its different customers through
Discounts, Sales Discount Offers etc.?
Answer-
Yes- 18
No- 2
8
1 2
0
2
4
6
8
10
12
14
16
18
20
Column M

Interpretation- 18 out of 20 respondents state that Tesco brings out promotional schemes for
its different customers in the market. The remaining 2 respondents state that Tesco does not
brings out promotional schemes for its customers in the market.
Recommendations for the company
There are different types of recommendations which can be followed by Tesco so that it
is able to enhance its innovation and creativity. These recommendations are stated as follows-
 Identify the scope for innovation and creativity- It is recommended to the managers of
Tesco that they are able to identify the scope for innovation and creativity in the market.
In this way they will be able to make sure that by providing of different types of
innovative products to the customers the company can achieve its goals and objectives in
the future without facing problems and issues.
 Identify the opportunities for growth- It is recommended to the management of Tesco
that the different types of opportunities for growth are identified which will enable the
company to grow effectively and efficiently in the future. In this way the company will
be able to ensure that it can attain its goals and objectives in the future without facing
problems and issues. For example- Online Retailing is the way to go forward for the
company as nowadays the millennials are focusing on ensuring that they are able to shop
24*7 at their convenience. Thus in this way the company is able to make sure that the
different types of goals and objectives can be attained by them without facing problems
and issues.
 Focus on the customers- Tesco must focus on its different customers in the market to
ensure that they are provided discounts and they can make use of various types of
promotional offers properly so that they are satisfied with the company (Sigarev and
et.al., 2018). Satisfaction of the customers must be of utmost importance for the company
because if they are satisfied the company will be able to ensure that the goals and
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objectives are achieved by it effectively and efficiently without facing problems and
issues.
 Be dynamic- Business environment is quite dynamic in nature and can change very
quickly (Zubeldia and et.al., 2016). Therefore it is important for the business
organizations that they are able to become highly dynamic and thus are able to target use
of different types of strategies to get ahead of the competitors in the market. Thus the
mangers of Tesco are recommended that the company must be made dynamic so that the
different types of problems and challenges are faced by it effectively and efficiently and
therefore it is able to make sure that the use of strategic approaches can be made by it so
that the problems and challenges can be effectively resolved and thus this can help them
in becoming dynamic in the market. In this way growth can be achieved by the company
in the long-term which can be quite helpful for it.
CONCLUSION
From the above report, it can be concluded that Retail Sector is a Sector which has
witnessed a higher-level of growth in the recent time. It has witnessed growth in the recent time
and thus in this way is ensuring that the retailers can earn a higher-level of profit through the
application of appropriate methods as well as strategies effectively and efficiently. There are
different types of trends in the retail industry which can be adopted by the various organizations.
Use of various models can be made for the purpose of carrying out External and Internal
analysis. Primary Data Collection can be done through the use of Questionnaires and
interpretation can be carried out on the data obtained through them. The use of different types of
recommendations can be made by the companies so that they are able to ensure that they can
attain significant goals and objectives in the future.
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REFERENCES
Books and Journals:
de Vass, T., Shee, H. and Miah, S. J., 2020. Iot in supply chain management: a narrative on retail
sector sustainability. International Journal of Logistics Research and Applications,
pp.1-20.
Dixon-O’Mara, C. and Ryan, L., 2018. Energy efficiency in the food retail sector: barriers,
drivers and acceptable policies. Energy Efficiency. 11(2). pp.445-464.
Filimonau, V. and Gherbin, A., 2017. An exploratory study of food waste management practices
in the UK grocery retail sector. Journal of Cleaner Production. 167. pp.1184-1194.
Jaravel, X., 2019. The unequal gains from product innovations: Evidence from the us retail
sector. The Quarterly Journal of Economics. 134(2). pp.715-783.
Kjellberg, H., Hagberg, J. and Cochoy, F., 2019. Thinking Market Infrastructure: Barcode
Scanning in the US Grocery Retail Sector, 1967–2010. In Thinking infrastructures.
Emerald Publishing Limited.
Mohr, A. and Batsakis, G., 2018. Firm resources, cultural distance and simultaneous
international expansion in the retail sector. International Business Review. 27(1).
pp.113-124.
Nash, J., 2019. Exploring how social media platforms influence fashion consumer decisions in
the UK retail sector. Journal of Fashion Marketing and Management: An International
Journal.
Oliveira, J. M. and Ramos, P., 2019. Assessing the performance of hierarchical forecasting
methods on the retail sector. Entropy. 21(4). p.436.
Roy, S. K. and et.al., 2018. Predictors of customer acceptance of and resistance to smart
technologies in the retail sector. Journal of Retailing and Consumer Services. 42.
pp.147-160.
Sigarev, A. V. and et.al., 2018. The role of chains in the Russian retail sector.
Zubeldia, B. B. and et.al., 2016. Effectiveness of the cold chain control procedure in the retail
sector in Southern Spain. Food Control. 59. pp.614-618.
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