Retail Innovation: A Comparative Study of Tesco and Sainsbury's PLC

This report provides a comprehensive analysis of innovation and commercialization strategies employed by Tesco PLC and Sainsbury's, two major players in the grocery retail sector. It explores how each company sources and fosters innovation, identifies the types of innovation they utilize (sustaining and radical), and assesses the success or failure of these innovations. The report further offers recommendations for innovative procedures for new online grocery retailers, including integrating online and offline experiences and enabling voice ordering. It also suggests funding channels and tools for protecting intellectual property rights. The document concludes with an action plan for innovation, emphasizing methods to secure and leverage intellectual assets. Desklib offers a platform for students to access similar solved assignments and past papers.

Unit8 Innovation and
Commercialization

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Analysation of comprehension, analysis and discussion on how innovation is sourced and
fostered by each of the retailers in the context of the firm “TESCO PLC.” and
“SAINSBURY'S”:.......................................................................................................................3
Analysation of the types of innovation present in each of the company “TESCO PLC.” and
“Sainsbury”:.................................................................................................................................4
Critical Assessment of Success or Failure of Innovation in Retailers.........................................6
PART 2............................................................................................................................................6
Recommendations for Innovative Procedures for New Online Grocery Retailer.......................6
Recommended Funding Channels for the Business.....................................................................7
Recommendations of tools to protect the Intellectual Property Rights.......................................8
Action Plan for Innovation with suitable methods to secure them .............................................9
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Innovation is the process to create something new or to make changes in the existing
product, field or idea. Commercialization is the used to increase the process of innovation which
helps company to make a further development which benefits the company. Tesco & Sainsbury
are chosen in this report and are known as the largest retailer in the grocery chain. The current
report will include that ow innovation is fostered by the companies. Also, it will include the
different types and processes of innovation in the retailers and how the organization is processing
in the market. Further, it includes the innovative procedures for online markets by analysing the
risk and benefits associated with it. It also recommends the funding channels for the company.
Further, it will include the evaluation of the different tools organization which can use for
development and to retain the different tools of the organization to protect and acknowledge the
intellectual property.
PART 1
Analysation of comprehension, analysis and discussion on how innovation is sourced and
fostered by each of the retailers in the context of the firm “TESCO PLC.” and
“SAINSBURY'S”:
Tesco Plc.: Tesco Plc. Operating as the British multinational firm in the areas of groceries and
general merchandize (Chen, 2022). The firm operates with it head quarter in the Welwyn Garden
City, England. The firm was founded in 1919 in the East London, by its founder Jack Cohen.
Innovation is fostered with in the firm in the way that it directs and strategically organizes its
employees by facilitating the business operations in the way that it develops the innovation with
in the firm. The strategy of making the employees work in the way makes them transform the
knowledge and other information with in the work place that makes them to develop the ideas for
the new products and enhance organizational strategies. The firm develops the innovation with
the collective work of the teams. The innovation team of the firm aims at to go from the ideas to
the products with in the six weeks and firms makes their employees run an hackathons with in
which the staff of development is included to work for the development of the prototypes of
ideas and bring them in to the market. The main innovation strategy that firm adopted is to give
public with the quality products, proper services and sustainable prices (Ortiz-Villajos, and
Sotoca, 2018). Organization finds it important to have the innovation with in the work place
because it helps the firm to find out new products, ideas and technologies that helps firm to serve

their customers, various colleagues like all the stake holders, team members, community and the
overall planet in a better ways in the future.
Sainsbury's: J. Sainsbury's Plc. Is operates as the second largest supermarket chain in the retail
sector. The firm operates with it headquarter in London, United Kingdom (Fengyi, 2021). The
firm gives around 14.9 percent of the total share in the supermarket sector. Organization was
founded in the 1869 by John James Sainsbury. The firm became the largest of grocery retailer
with in 20th century. The process of innovation with in the firm is adopted in the way that it has
introduced the speed in the innovation process and plans to do more cut off in the prices to join
in more of the customers to line up. The firm is working in the serious ways on the process of
innovation and have bought around 277 of the new line up of the product in the market and is
still planning in to have more of the 1900 to 2000 new products. Firm drives out innovation
process with the combination of its external and internal forces. Its internal innovation is driven
by its internal sources that are its employees, leadership and the management authorities. The
external factors that drives out the innovation for the company are its competitors, market
entries, and the political and the environmental regulations. These all factors make the firm
accordingly to foster new ideas and bring in innovative products that are complying with all the
internal and the external factors by making the company to achieve competitive edge in the
market. Firm operates with the real sense of excitements as it is continuously bringing in the new
products that is giving firm chances of helping people to eat better and live better. This process
of the offering people with the new products is a important step for the firm and this also
demonstrate the values showing reduction of the impact on the environment (Hameed, Nisar, and
Wu, 2021). Sainsbury's innovative process for focusing on the quality, sustainability and
provenance makes it easy for the firm to be differentiated from its competitors. This overall
strategy for the innovation also helps the customers to believe in the company by ensuring that
they are at the right place.
Analysation of the types of innovation present in each of the company “TESCO PLC.” and
“Sainsbury”:
TESCO Plc.: the firm uses the sustaining innovation process to have the improved performance
from the side of the company and it tries to bring in new products by working on the ideas and
launching them in to the market with in around six weeks (Awadari, and Kanwal, 2019). The
sustaining innovation of the firm works as the best way for the firm to protect its image and the

position in the market as firm is operating with the lot of competitors that are bringing in the
same products and can capture the market and make the customers turn towards them. This
incremental innovation process of the organization makes company to focus on small
improvements and on the existing products and services value of the firm and have more of the
customer satisfaction. The process of the sustaining innovation can be seen in the company as it
creates new products that helps firm to perform better in the market and have higher profits from
its best market force of the customers (Lee, and et.al., 2021). The sustaining innovation process
of the firm also focus on large changes that makes the company gain market shares and to have
the market leader position. This is that type of category that makes the firm to introduce the new
features in their products and services. This overall process makes the firm to differentiate itself
from its competitors. Thus, the innovation process helps the company to have the new products
and services and make it all drive through new distribution channels with the improved
production technologies and this also let the firm to expand its production out in to the new
geographical boundaries. This innovative process helps the firm to provide its targeted marketed
with the new products and services that are innovative enough to provide company with the new
customer base with the help of their potential markets.
Sainsbury's Plc.: the firm is the digitalized firm that makes in to have all the digital strategy
deriving through the innovation with in the firm (al Habibi, 2019). The firm uses in the radical
innovation to have in the new market base. This innovation procedure helps the organization to
have the new interactions ways in the market by creating the marketing base for the company.
This shift of the company towards the complete digitalized ways help the firm to have the
success derived from its organizational behaviours and overall capabilities of the firm to perform
in the competitive markets with its competitors. This helps the firm to create new ideas in the
right conditions by operating as fully commercialized and at the first place. This helps the firm to
differentiate itself from its competitors and also by protecting firm's long term sustainable
development with in the markets. The innovative process of radical innovation helps can provide
the firm with success in the present and the success of future (Rampa, and Agogué, 2021).
Adoption of the radical innovation in the work place makes the firm to have the market
leadership and proper majority in the market and also to maintain the massive potential value in
the market. The radical innovation process helps the firm to maintain and improve the image and
also to increase the customer loyalty by also having various benefits.

Critical Assessment of Success or Failure of Innovation in Retailers
Innovation plays a important role as it avails the chance to conduct a business practises
according to the customer needs and to gain a competitive advantage in the market. Tesco and
Sainsbury have their own fundamental processes which helps them in conducting a favourable
practises. Tesco analyses the market properly to launch new products, technologies and ideas
which would increase there profit margins and helps them in gaining maximum customer
satisfaction(Albors-Garrigos, 2020). They work with professionals who have creative mindsets
which helps them in transforming there business towards sustainable growth. Thus, it can be said
that innovative methods which are used by Tesco will helps in achieving success in long run. On
the other hand, Sainsbury uses innovative techniques by providing fast delivery services to it
customers. It helps the company by providing them with the strong customer base and
accessibility to introduce the innovative product in the market. It also enables the workforce to
serve attractive services to the customers which increases the brand value.
Moreover, both the organization follow the norms and policies which helps the organization top
get success and to earn a competitive advantage in the market. These approaches help the
business to grow and to accomplish the goals of the organization. With these strategies,
Organization are able to generate better productivity and in achieving sustainable growth nd
development in the industry.
PART 2
Recommendations for Innovative Procedures for New Online Grocery Retailer
For new online grocery store, it is essential to analyse the current market trends that ere
prevailing in the market. It is essential for the company to cope up with the suitable market
strategies to promote their products and by adding value to the product. It can be considered by
analysing the benefits and risk in the innovative process. There are some suggestive measures
which can help the retailer to conduct the online facilities in a better way as compared to there
competitive forces in the market. As grocery is one of the sector which caters the basic needs of
customers by serving a high quality product to gain the maximum customer satisfaction. In this
phase, online facilities plays a major role in increasing the sales of company in the market which
will help the company in gaining a competitive advantage. They can follow some measures to
conduct the online facilities smoothly(Martín, Pagliara and Román, 2019).
Online and Offline experience with new drinks and other products-

Implementing a physical stores in the market can be done while having access to the
online market. It will help the customers, as they can avail facilities from both the platforms
according to there comfort. Online facilities are new trend which is being followed in the market
as both other retailers are catering online services. Online retailers can place the operations of
business with the facilities which will impact more customer satisfaction and results in higher
profit margins.
Enabling Voice Ordering-
Voice Ordering technologies are the most innovative technologies that are increased in
the grocery space. For example, Google and Amazon are developers of the voice-control devices.
They have partnered with the grocery chains to develop this new way of shopping. Consumers
assemble there products by simply saying what they need using this app. The app also exactly
knows the brand that you prefer for products. Consumers can choose to collect from their local
stores and the product will get delivered to their door(Sági and Juhász, 2019).
Recommended Funding Channels for the Business
Companies take use of funding to start a business or to grow in business. Funding is the process
to finance a project and program. It can be taken by businesses for short-term or long term
period. It is important for both the business and consumers as it gives power to businessman to
expand its business and power to consumer by increasing purchasing power and flexibility,
which help the business in increasing sales and cash flow of the business. It can be taken by
business in different ways such as:
 Debt: Debt is a source of funding which is used by the businesses by borrowing a sum of
money, which is secured against any tangible assets. It is repaid by the business by
adding the amount of interest along with it(Mason and Botelho, 2018). It is known to be a
cost-efficient way of getting the finance if you need it for the short or medium term
finance.
 Crowdfunding: Crowdfunding is the one such source of fund which is used by the
business by using a small amount of capital from big number of individuals to finance a
new business. It can be taken in use by vast network of people through social media
platforms and online websites to bring entrepreneurs and investors together.
 Angel Investors: These are known as the business angels who provide suitable financial
option, there are the high net worthed person who makes investment directly with

entrepreneurial business for equity. It is an form of smart money which adds value into
the investee business. In terms of serving angel investors they are not considered as
pursuing and charity as hobby. Also, they desire to have a solid investment over return
with profits and shares a relation of commercial business. They also wait for long time
period to get return on the investment in early business stages. The experienced ones can
also makes investment in the business practises and capital from business development.
 Government Grants: It is in the form of award given by a local, state or federal
government for providing benefits to business projects. It is said to be a transfer payment.
It does not include any financial assistance such as loan guarantee, interest rate or
revenue sharing. It is agreement of revenue sharing with the government which leads to
generating a profit. By using these grants, business can promote their operational and
crucial activities which would enable them to gain a competitive advantage in industry.
 Equity: It is source of fund which is used by companies by selling shares of the company
which results in generating a capital. Companies raise this capital to satisfy the short term
needs such as paying bills or for satisfying a long term goals by investing in the business.
Selling companies shares will effectively results in selling companies ownership in return
of cash.
 Friends & family: Friends & family can help in arranging funds for loan amount through
which it easier to get funds borrowed. Whereas, putting agreement in writing can harm
family relationships at huge risk. However, agreeing with loan makes arrangements more
in business manner(Utami and Widiyanti, 2020).
Recommendations of tools to protect the Intellectual Property Rights
Intellectual property rights are also regarded as the valuable asset of the company. In a
single product or idea, there are several rights which are applied. The company must acquire the
intellectual property rights to protect the concept from not being stolen to others and also to
protect the innovation. These rights covers the original ideas, creativity, inventions and
discoveries produced by a person or group. Previously protecting such rights was not a big deal
as if now information is more accessible and convenient to distribute today because of
technology. Intellectual Property rights are one of the most important things to pay attention to in
the business world(Mansfield, 2019). There are some effective ways for online retailers to
protect there rights.

 Trade Secrets: Trade secrets are the confidential and unique information of business,
which is valuable to company as it offers competitive advantage in the market. By using a
trade secret protection, the firm is benefited as others cannot steal their ideas. If in case,
any firm steals the trade secret, then the protected firm can file a petition against the
person who prohibited the law by utilizing a trade secret.
 Patents: A patent is an right provided to the product or a method that has been invented
newly and also provides new technological solutions to the consumers. It gives the holder
the protection against the patent. It can be provided for fixed amount of time. If the patent
holder allows, then only the innovation can be officially manufactured, distributed,
utilised or sold. If the patent expires, then the innovation can enter into the public which
means the owner has no right over the innovation any more(Guo-Fitoussi, Bounfour and
Rekik, 2019).
 Copyrights: Copyrights are the type of intellectual property rights that protects the work
of authorship such as works, arts and music. It seems as inherent in work which means it
does not require any registrations. Copyright helps by establishing that the work is
copyrighted by a person and the person is creator of the work performed. Some people
also sell there copyrights of their work to earn the revenue.
 Trademark: Trademark is a mark which identifies that the particular product or service
are produced or offered by the specific business or person. It can be in the form of single
letter, word, number or maybe a combination of them. Packaging and design of items , or
any other unique elements are also considered as its examples. It ensures that the owner
has the sole mark to identify the products or service.
Action Plan for Innovation with suitable methods to secure them
Introducing the online grocery market of UK will be followed suitably on the basis of action
plans.
Step1- Setting up SMART Objectives
Specific-This is the first phase of planning where SMART goals are required to be clearly stated
in order to achieve the success of business with more clear and stable goals.
Measurable- Goals can be measured by getting the success aspect which will help the customer
in retention of online platforms and analysing the internal trends(Ishak, Fong and Shin, 2019).

Achievement- Goals should be achieved within the community, partners,team. It will helps the
organization to identify what is achievable through discussion.
Relevant: Objectives of an organization must be relevant by forming up the valuable image of
the business and improving the customer base with better offerings.
Time-Bound- objectives must be time bound which motivates the people to complete the task on
time. It must attach a reasonable date by which and object will happen.
Step2- Forming list of action
Arrangement of funds: Business will accessed the loan by bank by paying the higher interest rate
in return.
Inventory Control: It is an approach for managing or controlling the inventory which would be
followed by the online retailer to order the raw material from supplier on time when it is
required.
Agreement with suppliers: By contacting with the suppliers, the company will select the supplier
which will provide the company the best quality raw material at reasonable prices.
Following intellectual property rights: For introducing a new product, company will follow the
intellectual property rights(Shajin and et.al, 2018). This will allow the business to protect its
rights from the broad range of external environment challenges.
Step3 Timeline
It can be stated that the desired goals of business will get achieved in the time frame of one year
by getting a suitable sales ratio and customer base.
Step4 Delegating Resources
All the essential resources of business like financial,human and physical are going to be utilized
by business in order to make innovative product and in order to gain a competitive advantage.
Step5 Evaluating the process
The overall process made in the business in the context of providing innovative goods within the
online grocery market of UK, the customer retention and profitability rate will be considered in
this part for the period.
CONCLUSION
From the above report, it can be concluded that the Innovation and Commercializations are
known as the building blocks of the business as they help the business in its growth and
development process. This report has covered potential ways in which innovation is fostered in

context of chosen organization. Furthermore, it highlighted the types and processes of innovation
on the selected retailers and how it is going to process in the market. It also includes the
processes which helps the new online grocery store to earn success in a long run. Further, it
recommends the funding channels which are can be used by the online retailers to arrange
finance(Avgeris and et.al, 2019). It is also going to include the intellectual; property rights which
company can use to safeguard its rights and to protect its product or services from the
competitors. Further, it sumps up with the action plan which helps the online retailers in doing
proper planning regarding the business which will help in increasing the efficiency and
productivity of the company and by accomplishing the goals of the company.

REFERENCES
Books and Journals
Albors-Garrigos, J., 2020. Barriers and enablers for innovation in the retail sector: Co-innovating
with the customer. A case study in grocery retailing. Journal of Retailing and Consumer
Services. 55. p.102077.
Avgeris, M. and et.al, 2019. Adaptive resource allocation for computation offloading: A control-
theoretic approach. ACM Transactions on Internet Technology (TOIT).19(2). pp.1-20.
Awadari, A.C. and Kanwal, S., 2019. Employee participation in organizational change: A case of
Tesco PLC. International Journal of Financial, Accounting, and Management, 1(2),
pp.91-99.
Chen, J.J., 2022. Tesco Plc. In International Cases of Corporate Governance (pp. 27-44).
Palgrave Macmillan, Singapore.
Fengyi, Z., 2021. The Analysis of Asda-Sainsbury’s Merger/Acquisition. Journal of Finance
Research, 5(1), pp.1-6.
Guo-Fitoussi, L., Bounfour, A. and Rekik, S., 2019. Intellectual property rights, complementarity
and the firm's economic performance. International Journal of Intellectual Property
Management. 9(2). pp.136-165.
Habibi, B., 2019. HR practices of Marks & Spencer, Selfridges, Primark, and
Sainsbury’s (Doctoral dissertation, University of Science & Technology).
Hameed, W.U., Nisar, Q.A. and Wu, H.C., 2021. Relationships between external knowledge,
internal innovation, firms’ open innovation performance, service innovation and
business performance in the Pakistani hotel industry. International Journal of Hospitality
Management, 92, p.102745.
Ishak, Z., Fong, S. L. and Shin, S. C., 2019, October. SMART KPI management system
framework. In 2019 IEEE 9th International Conference on System Engineering and Technology
(ICSET) (pp. 172-177). IEEE.
Lee, S.G., Blood, A., Gordon, W. and Scirica, B., 2021. Disruptive and Sustaining Innovation in
Telemedicine: A Strategic Roadmap. NEJM Catalyst Innovations in Care
Delivery, 2(6).
Mansfield, E., 2019. Intellectual property, technology and economic growth. In Intellectual
Property Rights in Science, Technology, and Economic Performance (pp. 17-30). Routledge.
Martín, J. C., Pagliara, F. and Román, C., 2019. The research topics on e-grocery: Trends and
existing gaps. Sustainability. 11(2). p.321.
Mason, C. and Botelho, T., 2018. Early sources of funding (2): business angels.
In Entrepreneurial finance: The art and science of growing ventures (pp. 60-96). Cambridge
University Press.
1

Ortiz-Villajos, J.M. and Sotoca, S., 2018. Innovation and business survival: A long-term
approach. Research policy, 47(8), pp.1418-1436.
Rampa, R. and Agogué, M., 2021. Developing radical innovation capabilities: Exploring the
effects of training employees for creativity and innovation. Creativity and Innovation
Management, 30(1), pp.211-227.
Sági, J. and Juhász, P., 2019. Funding alternatives and business planning in family
businesses. Prosperitas. 6(1). pp.35-53.
Shajin, D. and et.al, 2018. Discrete product inventory control system with positive service time
and two operation modes. Automation and Remote Control. 79(9). pp.1593-1608.
Utami, D. and Widiyanti, M., 2020, May. Behavior of Accumulated Assets and Sources of
Funding. In 5th Sriwijaya Economics, Accounting, and Business Conference (SEABC 2019) (pp.
28-32). Atlantis Press.
Online
All about Intellectual Property Rights (IPR). 2016. [Online]. Available through:
<https://blog.ipleaders.in/all-about-intellectual-property-rights-ipr/>
2