BUSINESS

International Economic Environment

International Economic Environment

Introduction

Tesco is one of the leading retail stores based in UK. It is operating in more than 14 countries and have international chain of stores in internal market. Its products include food items, furnitures, electronic items, clothing, health and stationary, seasonal goods and cooking items. The internal markets include U.K., India and North America. It has also started selling its products online in order to capture large chunk of internal customers (Terry and Phillips, 2008, pp. 89-102).

Tesco is a leading food and grocery retailer. The company operates 4,811 stores in 14 countries worldwide. Tesco is running its services in UK and many other countries across United States of America and Asia. The main objective of this study is to analyze the international strategies of Tesco and standardization of products in international market.

The report consists of thorough analysis of Tesco Company, its international marketing strategies, entry mode strategy and standardization issues. The report ends with a short summary under the conclusion.

Industry Analysis

Grocery retailers increased by 3% in current value terms in 2010, compared with a negligible decline in non-grocery retailers. Tesco continued to lead retailing in the UK in 2010, with almost double the share of its closest competitor, Asda Stores. Retailing in UK is expected to increase by a constant value of 2% over the forecast period, as Internet retailing will continued to experience strong growth and outperform store-based channels. The majority of the leading UK-based retailers are seeing already their web bnased operations outperforming their bricks-and-mortar stores, and this is set to be continuing in future as well. Marketing creates problems for retailers, despite the competitiveness on the market. A marketing plan is the basis for the revival of the company, to provide a new direction for your business. Tesco plc is a global general merchandising retail and grocery store (Terry and Phillips, 2008, pp. 89-102). After Wal-Mart and France's Carrefour, Tesco plc is the third major global retailer with respect to revenues.

Initially, the company specialized in the trade of food and beverage, but later he expanded segments, such as food, clothing, electronic, telecommunications, services, health, home and car insurance, dental plans, funding. Tesco works and in its separate segments around the world, but it is necessary to have a competitive marketing plan to use existing opportunities in the global market (McTaggart, 2006, pp. 8-10).

Discussion

Different Entry Mode Possibilities

Since globalization and internationalization are rapidly growing in international industries and companies are adopting different strategies to enter in global market. In this consideration, selection of entry mode is the major decision that the company must take into consideration when planning to expand internationally. The decision of choosing appropriate entry mode depends on the equity that the company holds in foreign venture, that is the choice between non-equity and equity mode. According to Albaum et al. (2002), equity modes include wholly owned subsidiaries and equity joint ventures. On the other hand, non-equity modes include contractual and export ...