Strategic management in international companies

1. Tesco case study
8 group
Doina Bors, Indre Rumbutyte, Victoria Volentir

2. What is TESCO?
• Tesco is Britain’s leading
food retailer and the third
largest in the world;
• The first store was
opened in 1929 in
London;
• Tesco plc are the one of
the world‘s leading
multinational retailer.

3. How it started?
• After the World War I, Jack
Cohen bought paste and golden
syrup from British Royal Flying
Corps, besides he opened a
small grocery stall in the East
End of London, which he called
it TESCO;
• The name Tesco is derived from
TES (from TE Stockwell, a tea
supplier Jack Cohen used) and
CO (Cohen).

4. History
• By the 1960s, the company had
established its self-service model and had
developed a reputation as a value for
money retailer;
• Their motto: “pile it high and sell it cheap”;
• Tesco launched Clubcard, the loyalty
programme in1995;
• By 1995, Tesco had become the number
one UK supermarket.

5. Diversification of products
• Tesco became multi-format
operator in UK by the mid-
2000s;
• Have 72 % of the UK
stores;
• They diversified into non-
food products and retail
services (personal finance,
telecoms, online shopping
channels).

6. International expansion

7. Market in Europe
• Hungary; Poland;
Czech Republic;
Slovakia; Ireland;
Turkey.
• 1 507 stores;
• Revenue in Europe:
£9.3bn.
Dates of TESCO site, 2012

8. Market in Asia
• Thailand; S. Korea; Taiwan; Malaysia;
Japan; China; India;
• Stores: 2 131;
• Revenue in Asia: £11.5bn;
• Exit the market: Taiwan.
Dates of TESCO site, 2012

9. Success in Thailand
• Enter to the market in
1998;
• The stores name : “Tesco
Lotus“;
• Company invested into
organic expansion and
developed store
programmes of
considerable flexibility.

10. Success in South Korea
• Enter to the market in 1999;
• The stores name : “Tesco
Home plus“;
• They were partnered with
company “Samsung“;
• They operate these
hypermarkets;
• It is the second largest retailer
in South Korea.

11. Failure in Taiwan
• Enter to the market in 2000;
• Exit the market in 2005;
• Developed just 6 stores;
• Problem: major multinational retail
competitor – Carrefour.

12. Market in USA
• Enter the market in 2006
in Los Angeles;
• New name: “Fresh and
Easy Neighborhood
Market“;
• They operated 182 stores.