Tesco Case Analysis Essay

Words: 1956
Pages: 8

Tesco PLC: Fresh & Easy in the United States (Group B) 1. Why has Tesco been so successful in the UK and in other countries?
Tesco PLC has been successful in the UK and in other countries largely due to Jack
Cohen, who instilled an entrepreneurial and service orientation into Tesco that would drive its customer­centric approach for more than 80 years, and Terry Leahy, who established “the
Tesco Way,” which included the company’s core purpose, values, principles, goals and a balanced scorecard.
Tesco had an in store policy that a new checkout line would be opened if there was more than 1 person waiting in line and they were pioneers in self­service checkout terminal. Tesco was also innovative with its store formats.
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(price, product, target, format)

Employees from local community, carefully selected to fit Tesco’s culture (p. 7)

Non­food items would account for only 5% of sales (p. 7)

“ready to sell” approach, whereby many products sent from distribution center to store pre­packaged, extending product freshness, protecting produce from damage, cutting down on spoilage, requiring less refrigeration, and reducing labor needed to stock shelves (p. 8)

Leveraging relationships with collaborators for distribution (p. 8); this centralized model was similar to Wal­Mart’s

Smaller stores = easier permitting process

Taking over existing, vacant drugstores = cheaper than building from scratch

New stores built from pre­made materials = quicker construction, lower overhead, streamlined supply chain

Energy efficient stores (30% less energy than comparable, traditional stores; some stores LEED certified)

Fresh & Easy emphasized everyday low pricing rather than weekly specials and hoped to

leverage lower operating costs to deliver what its website termed “honest low prices” on “fresh wholesome food” that “should be available to everyone” in a “neighborhood market.”
Fresh & Easy leveraged relationships with collaborators for distribution to create value by minimizing costs and emphasize fresh. Their “ready to sell” approach, whereby prepackaged products went directly from distributors to local