INDUSTRY AND COMPANY ANALYSIS

Industry And Company Analysis

Industry And Company Analysis

Industry Analysis - Tesco PLC

Profile of Retail Industry

Before looking into the organization which is a retail industry, an overview of the UK retail would set a background for this report. The United Kingdom apparel retail industry grew by 4.7% in 2007 to reach its current value of $38.7 billion. In 2009, the United Kingdom apparel retail industry is forecast to have a value of $45.8 billion, an increase of 18.5% since 2004. The women's wear sector dominates the UK apparel retail industry, accounting for 54.6% of its total value. The UK accounts for 15% of the European apparel retail industry's value and has one of the strongest performing apparel retail industries in Western Europe since the turn of the century.

 

Background of the Organisation

Tesco PLC is a retail outlet which operates in UK and Ireland and has in all 135 stores. The area of activity is retail clothing. It targets young, fashion conscious consumer below 35 and promises to offer high quality fashion basics at affordable prices. To provide value for money to its customer is the mission of ABC which is reflected in its statement of 'Look Good, Pay Less'.

Tesco is the largest food retailers in the UK, an estimated 15.5% share of the total market. Tesco is also designed to increase their share of non-market. The two most important factors for the success of Tesco in listening are to customers and learning from mistakes. Offering quality products at low prices and put local people first in the way they conduct their business as their main strategy. (Dixon, 2001, pp. 130)

Target Market

Fast Growth Industry

Retail Industry is the fast growing industry in UK and Ireland. Tesco faces strong affray from its direct competitors, encompassing Asda, Sainsbury's, Morrisons and Waitrose, which are vying with each other over cost, products and advertisements intermittently. It should thus be emphasised that Asda is one of the key competitors in this segment with an boost of market share from 16.6% to 16.8% throughout the fiscal year 2010/ 09, while Sainsbury's has shown an boost to 16.1% from 15.8% and Morrisons to 11.6% from 11.3% through the identical time span (Euromonitor, 2010, pp. 74-85).

Business Strategy

Differentiation

Tesco uses a differentiated marketing strategy. The company targets several market segments with separate offers for each of the goals. Tesco targets mainly consumers living in urban and suburban areas, as well as consumers living outside the city or area in suburban locations. Tesco Metro stores modern shops designed for consumers living in urban areas, especially civil servants who want to buy lunch or go shopping on the way home. These stores are located in the city centre and offers products to customers of quality.

 

Profitability of Tesco

Cost Leadership

Tesco has this strategy, and the objective is to become the lowest-cost manufacturer in the industry. Many (perhaps all) market segments in the commerce are provided with the focus put minimising costs. If the accomplished trading cost can not less than identical (or near) the ...