Detailed SWOT Analysis of Tesco: Business Strengths and Weaknesses

This report provides a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of Tesco, a major player in the UK grocery retail sector. The analysis highlights Tesco's strengths, including its large market share, diversified product offerings, global presence, advanced technology, and efficient supply chain. Weaknesses identified include past accounting issues, declining operating profits, low-cost strategy challenges, underperforming international operations, and high debt liabilities. Opportunities for growth include strategic partnerships, expansion in emerging markets, and enhanced online services. Threats to Tesco's business include Brexit-related challenges, increasing competition from rivals like Aldi and Walmart, negative media backlash, misleading marketing practices, and external factors such as legal and economic issues. The report emphasizes the importance of strategic decision-making and effective marketing tools to leverage opportunities and mitigate threats, particularly in the context of e-commerce and online business expansion. The analysis draws from various sources to support its findings and recommendations.

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SWOT analysis

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In all the business there are certain aspects which are required to be evaluated so that the future
performance can be improved. All the strengths, weaknesses, opportunities and threats which are
involved shall be analyzed and that will be performed with the help of SWOT analysis. Tesco is
the company established in the UK and the major elements which need to be considered are
provided here.
Strengths
Tesco is dealing in the grocery retail sector and considered as one of the largest among all. The
sales and revenue of the company are highest in comparison to the others involved in the same
industry. This covers great market share and so attracts more customers with its services and
products. There are around 6800 stores which are operated by the company in various countries
and that make it a global corporation (Business strategy hub, 2019). The products which are
offered by Tesco are diversified and it also provides jobs to a large scale of people. It is
considered as one of the largest employers in the private sector. The technology which is used by
Tesco is advanced and new and helps in enhancing the experience of all the customers. The
supply chain network of the company is efficient and this helps in reducing the cost which is
incurred together with the appropriate management of waste.
Weaknesses
There was a false declaration in the accounts related data and that led to the imposition of a fine
on the company and also the profits have been misinterpreted. The operating profits of the
company have declined and due to the same, there is a decrease in the share price also by about
9%. The company is following the low-cost strategy and by that, it faces the reduced profit
margin which is not appropriate in the long run (Marketing 91, 2019). There are certain countries
in which the operations performance of a company is not satisfactory and they required to be
improved. There are high credit card and debt liabilities and because of them, the profitability of
the company is affected.
Opportunities

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Various opportunities are available with the company to carry the growth and in that strategic
partnerships will be developed. By this there will be scope to provide more products and also a
large number of consumers will be attracted. The regions in which Tesco is not performing well
will be improved by entering into a joint venture (Salar and Salar, 2014). This will be done with
the help of local companies who will be providing the information in relation to the market. The
customer base can be increased by using technology and implementing online services. By this,
the products will be delivered and that will attract more people. There are several emerging
countries in which the expansion can be made such as Turkey and Indonesia. It will help the
company in increasing its profitability.
Threats
The main threat was faced due to the Brexit as there were several matters which were faced in
respect of cost and trade deals. There is a threat from the competitors which are growing in the
market such as Aldi, Wal-Mart and several others. Due to them, the market position is in threat
and there is the need to make the improvement so that the adverse impact of competition is not
faced. There was a Christmas ad which was launched in 2017 and due to that, it has to face the
backlash from media. It was considered as the disrespectful act for the faith of Christians and due
to that the stores have been boycotted (Sandberg and Mena, 2015). There was a fake farm brand
which was used by Tesco to sell its food products and it is considered as misleading the
customers. This resulted in severe legal actions which were taken against the company. The
operations performance of the company is affected by several aspects including legal and tax
matters, government regulations, economic factors and many more. Due to them, the efficiency
of the company is affected in an adverse manner. This is considered to be a threat to the
company as its profitability will be affected negatively
The company is having scope for growth and expansion and for that it will be required to take
the strategic decisions in an appropriate manner and using the available marketing tools in the
best manner (Fatricia, 2017). The e-commerce sites and online business shall be expanded and
new innovations shall be made in them which will help in utilizing all the available
opportunities.

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References
Business strategy hub. (2019) TESCO SWOT Analysis 2019 | SWOT analysis of Tesco. [Online]
Available at: https://bstrategyhub.com/tesco-swot-analysis-2019swot-analysis-of-tesco/
[Accessed 16 August 2019]
Fatricia, R.S., 2017. STRATEGIC ANALYSIS OF TESCO SUPERMARKET. Journal
Manajemen Terapan dan Keuangan, 6(02), pp.69-86.
Marketing 91. (2019) SWOT Analysis of Tesco Corporation. [Online] Available at:
https://www.marketing91.com/swot-analysis-of-tesco-corporation/ [Accessed 16 August 2019]
Salar, M. and Salar, O., 2014. Determining pros and cons of franchising by using swot
analysis. Procedia-Social and Behavioral Sciences, 122, pp.515-519.
Sandberg, E. and Mena, C., 2015. Exploring strategic strengths and weaknesses of retail
purchasing groups. The international review of retail, distribution and consumer research, 25(3),
pp.276-297.