Jack Cohen founded Tesco in 1919 in London. It has since grown to become the third largest retailer in the world. Tesco launched its first store in 1929 and first supermarket in 1956. It went international in 2002. Today Tesco operates over 2,400 stores worldwide and has a strong online presence through Tesco.com. While highly successful in the UK, Tesco's expansion to the US through its Fresh & Easy stores has faced challenges and not yet proven profitable.

2. Brief History
 1919: Jack Cohen founded Tesco, when he began to
sell surplus groceries from a stall in the East End of
London.
 1924: Tesco Tea Launched (Own First Product)
 1929: 1st Store Launched in UK
 1956: 1st Supermarket Opened
 2000: Tesco.com Launched
 2002: Tesco Goes International
 2009: Tesco Enters Clothing Segment
 2010: 1st zero carbon supermarket Launched

3. Company Overview
Tesco’s is a United Kingdom based international
supermarket chain. It is the largest British retailer
both by global sales and by domestic market share.
Established in 1924.
Tesco is the third-largest retailer in the world next to
Wal-Mart, Carrefour and is operating around 2,440
stores and employing over 400,000 people
www.tesco.com is recognized as the world’s largest
online grocer, with a customer base of little less than
1 million and more than 250,000 orders a week.
Tesco’s market share of UK retailing is 12.5%.
3

4. Company Overview
Tesco has moved into areas such as clothes,
consumer electronics, consumer financial services,
internet services, consumer telecoms and gas
stations.
Tesco now controls over 30% of the grocery market
in U.K.
As of March 2008, Tesco have a store in every
postcode of the UK.
1960 1970 1980 1960 2000

5. Core Competencies
 Environment friendly products
 Customer focused strategy
 Club card - a loyalty scheme (1995)
 Quality products at low price
 Improved Labeling
 Self-Checkout

6. Resource Based View
UK International
– No. of Stores 2000 – No. of Countries 12
– No. of Staff 270,000 – No. of Stores 440
– Turnover £29.5 Billion – No. of Staff 1,40,000
– Turnover £7.5 Billion

7. Resource Based View
Store Types: Store Offerings: Personal Finance:
Express Food Retail Insurance
Metro Non-Food Retail Savings Accounts
Superstore Petrol Stations Personal Loans
Extra Home Living Range Secure Investment
Tesco.com Bonds
Online Mortgage
Finder
1970 1992 1994 1994 1997

8. Resource Based View
 Tesco sells approximately 40,000 food products in its
superstores, as well as clothing and other non-food lines.
 The company’s own-label products are at three levels value,
normal and finest. Own brand accounts for approximately 50%
of sales.
 Tesco does business with nearly 2,000 own-brand
primary suppliers in 98 countries.

9. Tesco in United States
 On February 9, 2006, Tesco
announced that it planned to
move into the United States by
opening a chain of small format
grocery stores on the West Coast
(Arizona, California and Nevada)
in 2007 named Fresh & Easy.
 By January 2007, Tesco opened
its U.S. headquarters in El
Segundo, California.
 On 21 April 2009 Tesco reported
a trading loss of £142m from
Fresh & Easy.

10. Tesco in the United States
 It has plans for rapid growth
and there are now 182 stores
in Arizona, California,
and Nevada as of October 5,
2011.
 On 4 October 2010 Fresh & Easy
announced that it was
temporarily closing 13 stores
because of shrinking populations,
high percentage of housing
foreclosures and high
unemployment rates.
 The business is not expected to
break even until 2012-13

11. Discussion Questions
1. What are the keys to Tesco’s succes in the
competitive retailing industry?
2. In view of the tough retailing environment, what
changes do you think Tesco might be forced to make to
the ‘’Fresh & Easy‘’ concept?
3. Which of the market entry strategies identified in
the chapter Tesco using in the United States? Do you
think this is the appropriate strategy?