TESCO

Tesco and its business Environment

Tesco and its business Environment

Introduction

Tesco is one of the most known and successful supermarket chain founded in UK. One of the largest retailers in the world, it has its stores being concentrated in the region of Europe and Asia. It comprises of approximately 2,318 stores having an employee base of around 326,000 people. Originated at London's East End in the year 1914, as war veteran Jack Cohen started selling groceries in the market. It is the history on the back of which Tesco is popular for its grocery line. The brand name got recognition when it was labelled on the packets of tea in 1920. Tesco, the brand name, is pre-dominantly a combination of initials borne by partner in the tea supplying firm named T. E. Stockwell and first two words of Cohen. And thereby, the first store of Tesco emerged in Burnt Oak, Edgware in the year 1929. From there onwards, Tesco started to expand, transcending stores to become supermarkets. 1990's is characterized by further expansion and aggressive marketing strategies by Tesco in an attempt to overtake the market share of Sainsbury's as the leading grocer. 1996 saw the beacon of overseas expansion being lighted and thus it now operates in numerous countries. With such large and diverse operations, come disparate challenges as posited by changing external environment and for it to be dealt with due diligence, extensive research and analysis is mandatory.

Discussion

Purpose of Tesco

Public limited companies (plc) and private limited companies are the two major types of organization that are adopted by companies usually. The major purpose of any public limited company, as Tesco, is to provide return to public who has invested in their firm, through registering profits and subsequently issuing dividends. Since Tesco is listed in the London Stock Exchange (LSE) with its ticker being TSCO, therefore, its stocks or shares are available to the public to buy. Thus public buy their stocks in anticipation of the profitability and thus the return on their investment.

Private limited companies on the other hand remains restricted within a family, who are directly benefited by the profitability of a private limited organisation. Their stakeholders are limited as opposed to that of the public limited company, which has a wider base of stakeholder in the shape of public, huge base of employees, government; in the result of which it is tasked with the responsibility to make money for their huge base of shareholders. Thus, the purpose of private limited company is to raise profits to enhance business reputation and credibility.

Stakeholders of Tesco

Being largest British retailer by sales and market share and fourth in the world, after Wal-Mart, Carrefour and Home Depot, Tesco possess immense clout in the corporate world today. Major Shareholders of Tesco are FMR Corp and Fidelity Intl Ltd, which cumulatively have invested enough so as to have 5% of the shareholding of Tesco. Legal and General Group plc has 4% shareholding in Tesco. On the other hand, investments made by Barclays ...