This document provides an overview of Tesco, the largest retailer in the UK. It discusses Tesco's industry, competitors, strategies and financial performance. Tesco has over 2,400 stores worldwide, a 30% market share in the UK grocery market, and sales of over £22 billion in 2007. The document analyzes Tesco using various frameworks including Porter's five forces, resource-based view and SWOT analysis. It recommends Tesco focus on improving existing stores and potentially form strategic alliances to address weaknesses.

2. Contents Industry Overview 1 Company Overview 2 Competitors & competitor analysis 3 Strategic Groups 4 Resource Based View 6 Core Competencies 5 Activity Based View 7 Five Forces Model & Value Net 8 Value chain & SWOT Analysis 9 Adoption Of Strategies 10 Financial analysis & Recommendation 11

3. Industry Overview U.K The retail industry employed 2.9 million people, as at the end of September 20. The retail sector generates almost 8% of the Gross Domestic Product of the UK. Supermarkets dominate the UK food retail market, with 56.0% of sales. 11% of all VAT-registered businesses in the UK are retailers. 70% of UK retail is Organized and 30% is Unorganized.

4. Company overview 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 is the third-largest retailer in the world next to Wal-Mart, Carrefour and is operating around 2,440 stores and employing over 4,00,000 people Tesco’s market share of UK retailing is 12.5%. 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.

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

6. Competitors Safeway plc Somerfield SPAR Handels-Aktiengesellschaft The Boots Group PLC Wm Morrison Supermarkets PLC Booker Cash & Carry Limited ALDI Group The Carphone Warehouse Group PLC John Lewis Partnership plc ASDA Group Limited BP Plc Carrefour S.A. ExxonMobil Corporation The Big Food Group Plc J Sainsbury plc Marks and Spencer Group plc Royal Dutch/Shell Group Safeway Inc. Competitors

8. Positioning of Competitions Food Specialists Food with Non-Food Non-Food Specialists

9. Strategic Groups Sainsbury’s was the UK's biggest grocer until 1995, but was recently relegated to third position behind Tesco and Asda. Despite the fact that company has been struggling lately it is starting to get back on track. Despite predictions that Sainsbury's would regain second position and a narrowing of ASDA's lead in recent months, the latest figures released by Taylor Nelson Sofres show Asda's share as 16.6% compared to Sainsbury's at 16.22%. ASDA owned by US corporation Wal-Mart since 1999, is the only supermarket with the potential to become a thorn in the side for Tesco. Wal-Mart is the biggest food chain in the world and has annual sales eight times bigger than Tesco’s. Asda's George range of clothing is the best selling brand in the UK and company is thinking about acquiring Matalan, the giant discount clothing and home furnishing store.

11. Resource Based View UK – No. of Stores 2000 – No. of DC’s 28 – No. of Staff 270,000 – Turnover £29.5 Billion International – No. of Countries 12 – No. of Stores 440 – No. of DC’s 20 – No. of Staff 1,40,000 – Turnover £7.5 Billion

12. Resource based view 1994 1992 1970 1997 1994 Store types: Express Metro Superstore Extra Tesco.com Store offerings: Food Retail Non-Food Retail Petrol Stations Home Living Range Personal Finance: Insurance Savings Accounts Personal Loans Secure Investment Bonds Online Mortgage Finder

16. Five forces Model of competition Rivalry Among Competitors (High) Bargaining Power of Buyers (Medium) Threat of New Entrants (Medium) Threat of Substitute Products (Low) Bargaining Power Of Suppliers (Low)

20. Value net Tesco Complementors Suppliers Buyers Competitors

21. Porter’s Generic Value Chain MARGIN MARGIN PRIMARY ACTIVITIES SUPPORT ACTIVITIES TECHNOLOGY DEVELOPMENT FIRM INFRASTRUCTURE HUMAN RESOURCE MANAGEMENT PROCUREMENT INBOUND LOGISTICS OPERATIONS OUTBOUND LOGISTICS MARKETING & SALES SERVICE

22. SWOT Analysis Threats UK structural change could spark a price war Overseas returns could fall Wal-Mart/Asda challenge International expansion Opportunities Non-food retail Health and beauty Further international growth Weakness Reliance upon the UK market Debt reduction Signs point to serial acquisitions Strengths Increasing market share Insurance Tesco online Brand value UK market leadership reinforced

23. Sustaining superior performance Imitation Slack Substitution Hold Up Added Value Appropriate Value