Tesco Plc Essay

Submitted By monicsimevs
Words: 825
Pages: 4

Tesco is the largest British multinational retailing store headquartered in Cheshunt, Hertfordshire, England, United Kingdom. It is the second largest retailer in the world (just behind Wal-Mart which is a multinational retail store as well – but it’s American) and the third largest retailer in the world if measured by revenues only. It lags just behind Wal-Mart (again!) and Carrefour which is a European multinational retail as well. David Reid is the chairman and Philip Clarke. Tesco is in the tertiary sector and is the grocery market leader in the UK. Its ownership is based on a lot of shareholders who have purchased the company shares through the stock exchange. There are Tesco stores in 13 countries which are: Thailand,Slovakia,China,India,Malaysia,Czech Republic,Poland,Hungary,Ireland,Korea,Turkey, The Uk and USA. Tesco is currently very huge and there are future plans it would expand into more countries. Tesco entered the USA in autumn 2007 and it is trying to break into India. The majority of Tesco's stores are still in the UK (where it first began). 2,033 out of 3,409 Tesco stores are situated in the UK. Tesco employs 530,000 people and has millions of customers each WEEK! Tesco is a public limited company therefore it is known as Tesco PLC and can sell shares on the stock exchange market/to the public. The minimum value of shares to be issued (in UK) is £50,000. Tesco being a public limited company has a lot of benefits as well as drawbacks. Many organisations start of as a private limited company and later become a PLC to raise capital to help them expand and develop the company which can play a vital role in the competitive retail market. Some of the advantages of being a limited company are that shares can be sold to the general public unlike a private limited company and can help to raise large capital sum as there is no limit to the number of shareholders. They are also able to advertise in newspapers and on television whereas private limited companies are unable to do this.
Majority of shareholders are interested in investing their money into a company which is successful or has the potential to be successful in the near future. There is also liquidity – the shareholders are able to buy and sell their shares. Also being a PLC gives the company a more prestigious name/profile therefore banks would be more willing to give them loans. There is also limited liability for the shareholders and the business has separate legal entity meaning the business will continue even if any of the shareholders die. Some disadvantages of Tesco being a PLC is that the original owner may lose control of the business. Also due to its immensely large size they may face management problems such as slow decision making and industrial relations problems. These companies also have to publish their accounts in order to protect the interest of the ordinary investor so therefore competitors can see if they are doing well or bad. Initially Tesco had a market chain of only food supplies, but over the years its business has broadened in the fields of clothes, consumer electronic goods, and customer related financial services, internet service, consumer telecoms, and they even ventured into the field of selling and renting DVDs.
Tesco store types: Extra,…