TESCO is the largest Textile and clothing retailer. Its headquarter is in Uk. it is doing a great job in the textile, garments, clothing business

1. Assignment onAssignment on TESCO (Public LimitedTESCO (Public Limited
Company)Company)
 Student Name: NAFIS CHOWDHURY
 Student ID: 13313106018
Course Name: INTERNATIONAL TEXTILE BUSINESS
MANAGEMENT
 Course Code: GM 534
 Program: Master in Textile and Clothing Management
Campus location: Yonsei University, Seoul,South Korea.

2. 1.Company profile1.Company profile
Tesco started life in 1919 when Jack Cohen started selling surplus groceries from a stall in
the East End of London. Mr Cohen made a profit of £1 from sales of £4 on his first day.
The Tesco brand first appeared five years later in 1924 when he bought a shipment of tea
from a Mr T. E Stockwell. The initials and letters were combined to form Tes-co and in
1929 Mr Cohen opened the flagship Tesco store in Burnt Oak, North London. The brand
continued its rise in the 1930s when Mr Cohen built a head quarters and warehouse in
North London, and in 1932 Tesco became a private limited Company. . In 1947 Tesco
Stores (Holdings) Ltd floated on the stock exchange with a share price of 25p.
Tesco.com is a wholly-owned subsidiary offering a complete online service, including
tescodirect.com and tesco.net. The company also offers a range of both online and offline
personal finance services. Tesco showed its expansionary zeal early on by buying up rival
shops. In the 1950s the retailer bought 70 Williams stores and 200 Harrow stores,
followed by 97 Charles Philips stores and the Victor Value chain in the early 1960s.
Throughout the 1990s, Tesco expanded even further, and continued it’s international
expansion

3. 1. company profile1. company profile
In response to a growing Eastern European market, Tesco opened stores in Poland,
Hungary, Slovakia and the Czech Republic. Tesco also expanded into Taiwan,
Thailand and South Korea.
The company purchased the UK-based T&S, a convenience retailer, while in Poland
it
bought HIT, a hypermarket operator, in 2002.
In November 2003, the company purchased the small Turkish hypermarket chain,
Kipa. The chain operated five hypermarkets in the Aegean region with reported
sales
in 2002 of £124 million, pre tax profit of £4.7 million and over 1,500 employees.
In early 2004, the company announced that it was purchasing the family-run chain,
Adminstore, which operates the Europa, Harts and Cullens grocery outlets in the
London area, for £53.7 million.
Over the years their business has grown and we now operate in 12 countries
around the world, employ over 530,000 people and serve tens of millions of
customers every week. For the year ended February 2004 Tesco PLC achieved
revenues that totalled
£33,557 million, an increase of 18.7% against the previous year’s revenues that were
£28,280 million they have always been committed to providing the best shopping
experience. Today they continue to focus on doing the right thing for their
customers, colleagues and the communities they serve.

5. 2. What are the main international markets of the company? What2. What are the main international markets of the company? What
percentage of the firm’s annual sales come from its home market?percentage of the firm’s annual sales come from its home market?
What percentage comes from other countriesWhat percentage comes from other countries
The home country of TESCO company is United Kingdom.
The annual income from the home country by last year was
amounted to 72% in 2014.
The main international markets of the TESCO company are
Hungary, Ireland, Poland, Japan, Korea, Thailand, and
Malaysia. The annual sales from these countries amounted
to 20% in 2014.
The remaining 8% was sold throughout the revenue of market
share.

6. 3. Explain two international business activities of the3. Explain two international business activities of the
company?company?
International business activities refer to any business activities
that cross national boundaries. These activities can be
categorized into four basic types: importing and exporting,
licensing, strategic alliance and joint venture and direct
investment. Businesses can choose among these activities
while expanding their operations to international markets or
face these activities of foreign companies in local markets.
 Two international business activities of TESCO Company:

7.  Joint venture:
Retailing is a local business. Customers love local and
regional products; we pride ourselves on having local people
running our operations; and we use local knowledge to
source and to allocate space to the most popular products.
However, lots of what we do – especially behind the scenes
– is best done in the same way across our markets. We are
increasingly realizing our vision to win locally by applying
their skills globally.
Since the mid-1990s, they have built an international
business with more stores than in the UK, which has
delivered more than £1 billion trading profit for the first
time – larger than any of their UK competitors. With strong
market positions, they are well positioned to move into the
next phase of growth

8.  Strategy alliance:
Tesco has evolved an international strategy based on six elements:
 Be flexible - each market is unique and requires a different approach
 Act local - local customers, local cultures, local supply chains and local
regulations require a tailored offer delivered by local staff - less than 100 of
Tesco's International team are ex-pats
 Keep focus - to be the leading local brand is a long term effort and takes
decades, not just a few years
 Be multi-format - no single format can reach the whole of the market. A
whole spectrum from convenience to hypermarkets is essential and you
need to take a discounter approach throughout
 Develop capability - developing skill in people, processes and systems and
being able to share this skill between markets will improve the chances of
success in challenging markets
 Build brands - brands

9.  Strategy:
 Directly address Marks & Spencer
 Super-premium product and price
 Limited to high-value added items
 Attract up market shoppers
 Capture margin in new category
 Aim to provide complete basket
 Same quality as national brand
 To be the brand to choice
 Increase margins vs. branded

10.  Directly address limited assortment (e.g. Aldi)
 Cheap and basic
 Limited to low-value added items
 Targeting specialty niches with products
 Recently renamed Healthy Eating to Healthy Living to
stretch to non-foods
 Help parents improve diet
 Minimum use of artificial ingredients

11.  Strategic business unit:
Tesco has chosen to pursue a strategic business unit (SBU) across all of
its business areas in order to maximize the degree of competitiveness
within the individual market areas. According to Mockler (2002), The
SBU would cover… the strategic foundation; size and scope of the
operation; strategic thrust; the kinds of products or services sold and
delivered; service quality and image; product/service brand identification
and image; breadth of the product/service line; functions performed by
the company; distribution outlets; customer market served; geographic
market served; ownership; and financial targets. Tesco operates using
four strategic business units - Core UK, which handles United Kingdom
grocery operations, International, which handles international holdings,
Non-Food, which handles sales of electronics, home goods and other
non-food items sold in Tesco Extra and other stores, and Retailing
Services, which manages financial services, the Tesco.com web site, and
Tesco Telecoms services (Tesco, 2008).

12.
4. Choose one of the international markets of the4. Choose one of the international markets of the
company: (a) Explain 5 cultural elements of the selectedcompany: (a) Explain 5 cultural elements of the selected
marketmarket
Culture is essential for the success of international business but
balancing the culture is extremely difficult because Tesco operates
in different parts of the Europe and Asia, each country being
culturally different from the other, cultural differences provide
challenges to international managers in marketing products,
managing workforce and dealing with host country governments.
 The dimension of culture includes:
 The social organization of society
 Religion
 Customs and tradition
 Political levels
 Aesthetic systems (e.g. music, arts, literature, language.)

13.  Cultural elements in California, USA:
This most recent expansion provides insight into the use of the
strategic business unit for development of international markets.
Most noticeably, Tesco has tailored their product offerings and
branding to the local market and culture.
All aspects of the store's marketing and design were custom-
tailored to the market region in which they were opening. The
name, Fresh and Easy, was intended to take advantage of
Californian culture and values. Their product offerings within the
store, with a strong emphasis on fresh fruits and vegetables,
natural and organic food, halal food, were intended to not only
appeal to the tastes of the local culture but also to fill a gap in the
current supermarket offerings within the region

14. The locations, which are primarily urban, small footprint
locations in city centres and underserved neighborhoods,
are intended to not only take advantage of the chance to
enter an underserved market but also to fit the market
needs of the surrounding areas and to integrate seamlessly
into the neighborhoods. These alterations to the core
product (a small supermarket along the lines of a Tesco
Express) have allowed for a successful entry into the
Californian market, as Tesco have adapted to the local
culture rather than attempting to import an unaltered
product into an area.

15. (b) How does the company adjust products/services, packaging,(b) How does the company adjust products/services, packaging,
promotion, advertising, and so forth to maximize its success in thepromotion, advertising, and so forth to maximize its success in the
selected marketselected market??
 Product and services:
 Food, household, clothing, electronics mobile,entertenment,
health and beauty
 Tesco bank
 Tesco developed new products and services to sell to existing
customers
 Products:
 Segmented private label
 Expanded non-foods
 Services:
 Banking and financial service
 Telecommunications

18.  Product innovation :
 Markedly higher levels of own-label products at Fresh & Easy
than conventionally found in US food retailing (over 50% of
products own-label)
 Each Fresh & Easy store incorporates a „kitchen table with a‟
crew member offering food samples and menu suggestions in an
explicit attempt to build the Fresh & Easy brand
 UK food retailing acknowledged as having „world class skills in‟
the chilled/prepared meals segment, but this is the first time this
skill-set has been exported wholesale to the US from the
 The example of the TESCO’s Subsidiaries:
Tesco Distribution Ltd.
 Tesco House
 Delamare Road
 Cheshunt
 Hertfordshire
 T&S Stores PLC
 Apex Road
 Brownhills
 Walsall

19. Packaging:
TESCO packaging is different than others. TESCO
making the packaging system according to the
customers need and satisfaction. There are different
packagings where customer can easily identify and buy
the products. So the company can increase the sales
volume.
Promotion:
The promotion techniques are followed:
Weekend offer, 50% discount sales,
Independence Day discounts
Free products offer
Buy more save more promotion April, 2015
Monthly special sale promotion
Weekly special sales promotions
Social media (face book, twitter) for promotional offers
Mobile marketing through this company usually provide
offer to the customer and sending sms

22.  Advertising:
TESCO advertisement has been different from the other
company. The company shoots the advertisement with celebrity
of Europe and Asia. In which there are different states speaking
different languages. So the company has planned to shoot the ads
according to their respective languages and actors. The ads will be
reached to the people through electronic and print media like TV,
radio, news paper, magazines etc.
 a) Trialing of formats
 b) Innovative location strategies
 c) Digital marketing

23.  Trialing of formats • In the run-up to the opening of the first
Fresh & Easy stores the press reported that Tesco executives had
concealed the firm’s market entry plans by posing as film industry
moguls
 • The real Tesco operation carried out by Terry Leahy s‟
handpicked group, posted to Santa Monica between March and
October 2005 was even more covert
 • Group posed as International Research Resource Ltd, group set
up and tested mock-up of potential store in West Coast
warehouse
 • Transnational retailers usually focus on deriving competitive
advantage from back region spaces. Tesco entered USA unusually
determined to protect „front region knowledge‟

24.  Innovative location strategies
 Fresh & Easy has opened in a range of different locations, across
the income/class/ethnicity range e.g. Compton in South (Central)
Los Angeles; Hollywood, a stone’s throw from Mann s Chinese‟
Theatre and Manhattan Beach
 Tesco has been prepared to go into partnership arrangements
and develop stores in areas which have long been neglected by
the main corporate food retailers
 Whilst Fresh & Easy s contribution to these “underserved‟
markets” is clearly not altruistic, its stated desire to serve “all
kinds of neighborhoods” is an important and innovative dimension
of the firm’s market entry strategy

25.  Digital marketing
 Fresh & Easy has been extremely innovative with its use of
contemporary digital marketing techniques in order to spread the
message of the new brand in the US
 Simon Uwins, Chief Marketing Officer, uses his „blog on the firm’s‟
website in order to have a „conversation with customers and potential‟
customers. His blog is designed to add clarity to the firm’s mission, and
to demonstrate that Fresh & Easy are living up to this statement
 The firm treats Wins blog – together with blogs written by others on‟
Fresh & Easy – as “any other type of PR”. As Uwins remarks “We’ve
started to talk to bloggers and that’s working really quite well. We invite
them to [store] launches and stuff…they’re getting to know us…we’ve
got lots of positive blogs written about us now

26. References:References:
 Griffin, R., & Pustay, M., (2010). International Business. 6th
edn., Prentice
Hall, New Jersey, USA.
 Ball, D., McCulloch, W.H., Geringer, M., & Frantz, P.L. (2010).
International Business: The Challenge of Global Competition. 12th
edn.,
McGraw-Hill, USA.
 Fairfield-Sonn, J. 2001. Corporate culture and the quality organization.
London: Quorum Books.
 Rainey, D. 2006. Sustainable business development: Inventing the future.
Cambridge: Cambridge University Press.
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