M115LON Strategic Management: Tesco's Competitive Strategies

This report provides a strategic analysis of Tesco Plc, a multinational grocery and general merchandise retailer, within its competitive market. It examines Tesco's operations, strategies, and financial standing, focusing on its performance against competitors like Morrison and Sainsbury. The analysis employs tools such as the Ansoff Matrix, highlighting Tesco's market penetration and development strategies, and the BCG Matrix, categorizing business segments like 'Cash Cow' (meat section) and 'Stars' (Tesco Bank). The report evaluates these strategies using the SAFE framework, assessing their suitability, acceptability, and feasibility. Ultimately, the report recommends that Tesco continue to explore new markets and innovative products to maintain its leading position in the UK retail sector. Desklib provides access to this and other solved assignments for students.

STRATEGIC MANAGEMENT
Tesco

INTRODUCTION
 The intent of this study is to represent the
strategic direction of Tesco in the competitive
market. The study will present the company’s
operations, strategies, financial situation,
and the state of the sector in which it is
operating. It will evaluate the strategies of
the company in terms of suitability,
acceptability, and feasibility.

OVERVIEW OF TESCO
 Tesco Plc. deals in general merchandise and
groceries business as a British multinational
and traded as Tesco. It possesses shops in
seven countries across Europe and Asia. The
brand portfolio of the company comprises
Everyday Value, Technika, Finest, and
Chokablok. Tesco’s annual revenue in
Northern Ireland and the UK in 2017/2018
amounted to around 45 billion British pounds
(Statista, 2018).

KPI OF TESCO
In the retailing and grocery industry, Tesco is
outperforming in comparison to its competitors such
as Morrison, Sainsbury, and Asda. The KPI of Tesco is
 Market Share
Being the leading organization in the industry Tesco
has covered around 28% of the market share (Tesco
Plc., 2017). In contrast to this, Morrison is
comparatively vulnerable to Tesco and Sainsbury.
 Investors’ Expectations
Due to low product assortment, Morrison is
experiencing low investors' expectations. On the
other side, Tesco is known in the market to offer a
variety of products under one roof.

ANSOFF MATRIX
 Market Penetration Strategy
Tesco is offering a variety of products to target
almost all customer segments, which support it in
increasing its market share as well as sales (Tesco
Plc., 2018). However, now Tesco must try to shift its
focus towards enhancing its advertisement and
different promotional activities in order to attract
more and more customers.
 Market Development Strategy
In order to give strong competition to the existing
players and maintain a leading position, Tesco must
expand its market operations in Singapore market
because of the increasing wealth of the middle-class
segment.

BCG MATRIX
The BCG matrix is known as the Boston
Consulting group matrix of the product
portfolio.
 Cash Cow
The meat section of Tesco is included in the
cash cow category due to their constant
demand in the market (Adamkasi, 2016).
 Stars
Tesco Bank is placed in the star category
because the organization has expanded its
operations such as offering a current account
facility, loans, and insurance.

BCG MATRIX
 Question Mark
The product of Tesco that come under question
mark is Tesco Lard. Since the product is
making little cash for the business, but it is not
capable to generate high demand from the
consumers (Adamkasi, 2016).
 Dogs
The mobile segment of Tesco is included in the
Dog category.

SAFE FRAMEWORK
 Strategy 1
Tesco is suggested to adopt a market
penetration strategy by making some changes
in its present advertisement campaign. This
strategy will result in increased market share.
 Strategy 2
Tesco must adopt Market development
strategy, as it will support it in targeting a new
market and introducing new products.

SAFE FRAMEWORK
SAFe Framework Strategy 1 (Ranking
out of 5)
Strategy 2 (Ranking
out of 5)
Suitability 3 5
Acceptability 5 5
Feasibility 5 5
Total 13 15

CONCLUSION
 From the above analysis, it could be
concluded that Tesco is the leading retailer in
the grocery and retailing industry of UK. To
maintain this position company must adopt
different strategies such as market
penetration and market development
strategy.

RECOMMENDATIONS
 Tesco needs to explore the new market in
search of the new target market. This will
support the company in introducing new and
innovative products as well as will be able to
increase its brand awareness.

REFERENCES
 Adamkasi (2016) BCG Matrix for Tesco [online]. Available
from https://bcgmatrixanalysis.com/bcg-matrix-for-tesco/
[accessed 4 January 2019]
 Statista (2018) Annual revenue of Tesco Group in the
United Kingdom (UK) from the financial year 2015 to
2018* (in million GBP) [online]. Available from
https://www.statista.com/statistics/490931/tesco-group-fi
nance-revenue-united-kingdom-uk/
[accessed 4 January 2019]
 Tesco Plc. (2017) The six Strategic drivers [online].
Available from
https://www.tescoplc.com/media/392349/tesco_ar17_6dri
vers.pdf
[accessed 4 January 2019]
 Tesco Plc. (2018) About us [online]. Available from
https://www.tescoplc.com/about-us/ [accessed 4 January
2019]