Tesco's Business Functions and Strategies

The assignment content is about Tesco Ltd UK, a supermarket chain that aims to become a leading retailer by delivering quality products and services at less cost. The company's core functions include finance, administration, human resources, marketing, and research and development. The stakeholders of the company are customers, investors, employees, suppliers, and NGOs, who expect the company to improve customer shopping experience, provide quality products at affordable prices, increase employee capabilities, reduce costs and increase profits, repay debts on time, and contribute to social welfare. The company's aims relate to the expectations of its stakeholders. The assignment also includes a SWOT analysis of Tesco, highlighting its strengths such as being a globally recognized brand, offering value for money products, and having a wide range of products and an excellent product portfolio. Its weaknesses include facing bad debts from credit cards and insurance claims, lacking experience in some markets, and requiring significant resources to invest in new technologies. The opportunities for the company include expanding into digital entertainment, offering online shopping services, and expanding overseas. The threats faced by Tesco include intense competition from other retail grocery stores, expansion being hindered by town planning activities, intolerance of customers for out-of-town stores, and concerns about small shops' livelihoods.

Tesco ltd UK
The core business functions of TESCO:
 The finance function
 The administration function
 The human resources function
 The marketing function
 The research and development function.
Aims of TESCO:
1) It aims to become a leading supermarket in retail and deliver quality products and
services at less cost.
2) It aims to maximize its sales and hence increase its profits.
3) It aims to make the shopping of its customers cheaper by decreasing its prices.
4) It aims to include healthy eating products in its product range and offer it via an online
shopping site.
5) It aims to provide jobs to people and reduce unemployment in the local community.
Stakeholders of company and their expectations:
Stakeholders are- customers, investors, employees, suppliers and NGOs (www.tesco-
careers.com)
Expectations:
1) The company will improve the shopping experience of its customers.

2) Quality products will be provided by the company at affordable prices.
3) The company will increase the capability of its employees and will be unbiased to all
employees.
4) The company will cut down its costs and increase profits.
5) The company will repay the debts on time.
6) The company will contribute to the welfare of society.
Relation between the aims of company and stakeholders:
Costumers expect that the company will give quality products at low prices which are also an
aim of the company. Then, the company aims to increase its profits which are expected by the
investors. The company aims to give jobs to people which are an expectation of general public at
large and is a part of the social responsibility of firms. So most of the aims of the company relate
to the aims of stakeholders.
SWOT analysis of TESCO:
Strengths:
This is a globally recognized brand and comes in the list of top 100 most valued brands in the
world. The products offered by it provides value for money. It has a wide range of products and
an excellent product portfolio. Innovative business methods are utilized for the growth. It has a
presence across the world and has some stores like Tesco Metro, Tesco Express, etc. It gives an
opportunity to the customers to shop online. It has joint ventures with other countries like China
which gives it easy access to other markets too. It has the benefits of economies of scale. It has
kept the prices low to attract the customers. It has successfully created long term relations with
the customers. The Internet is used by elderly people as they have income by can't visit the store

to buy thing every time. By online site, Tesco has positively responded to the social change.
Supply chain management systems were developed by the company to attain competitive
advantage, and the cost efficiency was enhanced. It made use of the technology appropriately.
Weaknesses:
It faces bad debts from credit cards and the insurance claims of households. It lacks experience
in few markets that it has entered or plans to enter. It needs a lot of resources in cash to invest in
new technologies of The Web and IT. This has the possibility of adversely affecting the sales of
the company.
Opportunities:
It can expand into markets like digital entertainment. It can offer its rand smartphones and tablets
in markets like Malaysia, South Korea, and China, etc. With online shopping site, more
flexibility can be provided to the customers. This will attract more customers for the company. It
has the opportunity to expand overseas in Markets where the competition for retail grocery stores
is less like in Australia. The higher economic growth has paved a way for the growth of
supermarket industry. Also, the increased growth of the economy will increase the spending of
customers.
Threats:
It receives huge competition from other retail grocery stores. Wal-Mart poses a great threat to
Tesco as it has all the required skills, experience, funds, etc. that create problems for Tesco. The
expansion of Tesco is hindered by the town planning activities, intolerance of customers for the

out-of-town stores and the concern for the small shops livelihood. Due to the increase in the
VAT by the government, the customer spending might reduce, and it might negatively affect the
sales of the company. The government also proposed that it will adopt a fat tax to control the
medical problems in people due to obesity, this will also adversely affect the sales of certain
products.
Proposed improvements:
Tesco can launch a range of healthy products which it has already started to fight the impact of
the fat tax. Then it can reduce the prices of products so that even if VAT increase, the customers
can buy the products. To fight the competition, it can try to achieve the economies of scale, gain
competitive advantage, etc.

References:
Tesco.com. (2016). Tesco | Online Groceries, Homeware, Electricals & Clothing. [online]
Available at: http://www.tesco.com [Accessed 29 Apr. 2016].
Barnes, R. (2011). The great Tesco beauty gamble (the Tesco supermarket chains marketing’
strategy for breaking into the UK beauty services market). Strategic Direction, 27(7).
Wilkinson, M. (2000). The Tesco Roundabout. Books Ireland, (236), p.373.