Tesco PLC Case Study
Tesco PLC: Fresh & Easy in the United States [Group B report is required]
1. Why has Tesco been so successful in the UK and in other countries? Edgar
2. Which success factors are or are not transferable to the US? Gonzalo
This is a very attractive market due to the $600 billion in US; the growth potential is impressive and tempting. There is a increasing consumer interest in wellness and health food. Another reason to be part of this market is the fact that the retail market is mature, there are number of competitor and they believe that they have option to get a quote of this market. Tesco did something before starting Fresh & Easy in US, which is sent to US 50 senior managers to live in California with families and therefore they can understand the consumer beha and then can apply this information to the launch of the company, the mistake here was that they assume that what they got was enough. As a conclusion, it can be said that although initially the idea of expansion in US market received positive feedback, the result it did not meet expectations. ‘California, Arizona, and Nevada were among the states hardest hit and during the 2008 financial crisis and that had a negative impact on company’s extension plans. The process of adapting to the US market should continue in order meet the requirements of US shoppers.
3. Was Tesco smart to enter the US market? In California, Arizona and Nevada? Edgar
4. What is the Fresh & Easy value proposition? Is it likely to be appealing in California, Arizona and Nevada? Gonzalo
Tesco entered the US market with fresh and healthy food and prepared meals, but with a limited variety of goods compared to the average local supermarkets. Many products were sold under store label and thus were unknown to local shoppers. Frequent stock outs didn’t help as US shoppers went elsewhere in contrast with typical UK consumer who returns next day for the product. To better meet customers demand, the company increased the selection of
1. Why has Tesco been so successful in the UK and in other countries? Edgar
2. Which success factors are or are not transferable to the US? Gonzalo
This is a very attractive market due to the $600 billion in US; the growth potential is impressive and tempting. There is a increasing consumer interest in wellness and health food. Another reason to be part of this market is the fact that the retail market is mature, there are number of competitor and they believe that they have option to get a quote of this market. Tesco did something before starting Fresh & Easy in US, which is sent to US 50 senior managers to live in California with families and therefore they can understand the consumer beha and then can apply this information to the launch of the company, the mistake here was that they assume that what they got was enough. As a conclusion, it can be said that although initially the idea of expansion in US market received positive feedback, the result it did not meet expectations. ‘California, Arizona, and Nevada were among the states hardest hit and during the 2008 financial crisis and that had a negative impact on company’s extension plans. The process of adapting to the US market should continue in order meet the requirements of US shoppers.
3. Was Tesco smart to enter the US market? In California, Arizona and Nevada? Edgar
4. What is the Fresh & Easy value proposition? Is it likely to be appealing in California, Arizona and Nevada? Gonzalo
Tesco entered the US market with fresh and healthy food and prepared meals, but with a limited variety of goods compared to the average local supermarkets. Many products were sold under store label and thus were unknown to local shoppers. Frequent stock outs didn’t help as US shoppers went elsewhere in contrast with typical UK consumer who returns next day for the product. To better meet customers demand, the company increased the selection of