Strategic Management Assignment Example | Topics and Well Written Essays - 2500 words

Strategic Management - Assignment Example The company has strategic options like developing strategic alliances with local retailers, offering cost leadership and competitive pricing. Table of Contents Strategic management of TESCO supermarket 14 1 Strategic management of TESCO supermarket 1 Executive summary 2 Table of Contents 3 Introduction 4 Business environment 5 PEST framework 5 Political factors 5 Economical factors 6 Social factors 6 Technological factors 7 Porter’s five forces 7 Threat of new entrant 7 Bargaining power of suppliers 8 Bargaining power of consumers 8 Threat of substitutes 9 Bargaining power of competitors 9 Internal analysis 9 Swot analysis 11 Challenges facing the organization 12 Strategic options 12 References 14 Introduction Food retail sector in the United Kingdom employs over 3 million people. This makes it the largest industry in the economy. However, a growing number of supermarkets are coming under intense pressure because of unprofessional treatment meted on stakeholders in the supply chain. Tesco and other supermarkets are committed to strategic development networks that lead to increased productivity. This report gives a strategic management analysis of Tesco supermarket. ... United Kingdom is Tesco’s largest market. In this market Tesco operates under Metro, Express, Extra and Superstore banners. The retailer has diversified to non-food lines e.g. clothing. Tesco delivers close to 40,000 food products. The companies label products operate at three levels. Most of the stores contain gas stations. Therefore, it has grown to become of the leading petrol retailers in Britain. Tesco personal finance is a retailing service offered by the supermarket is a bid to expand its market share. Business environment The business environment on a retailer plays a central role in its profitability. Companies are under intense pressure to acknowledge their responsibility to the society. The introduction of taxes that target the increased advertising of fatty food is bound to affect the performance of the supermarket (Stone 2009). The relationship between consumers and supplies has also been affected because of the ‘fat tax’. The presence of powerful com petitors has led to intense price wars. In some instances, the foreign market environment is hostile and governments try to protect the local industries from foreign competition. Government policies that promote monopoly controls have been blamed for limited access to some markets and segments. Such policies have the capacity to reduce the buying power of consumers. Differentiation is increasingly becoming difficult because of unhealthy competition and government interference. Tesco has developed a policy in which it reduces the prices for fuel based on the amount of sales at its groceries. The retailer compensates by raising prices in other stores. PEST framework Political factors Besides the United Kingdom, Tesco operates in six countries in Europe. The legislative and