Tesco Managing Capabilities Essay Example | Topics and Well Written Essays - 3750 words

Tesco Managing Capabilities - Essay ExampleTesco was founded by Jack Cohen in 1919. It is listed on the London demarcation Exchange and also is the component of FTSE100 Index. The company experienced a market capitalization of about 24.4 billion by 15 January 2012. According to a sell analyst it has been revealed that Tesco is the most successful retail business round the globe. According to Tescos strategy the company uses its own brand products. The innovative technology fashion has been Tescos core part for its expansion strategy (Wrigley, 2000). The Company is listed on London Stock Exchange with the symbol of TSCO.Tesco represents in UK the largest food and drink retail sector industry. It provides employment to more than three million people in manufacturing, retailing and primary production. Tescos largest market is in UK and the company banners under 4 main things that are Extra, Metro, Superstore and Express. Almost 40,000 food items and products and also the non food li nes and the clothing are sold by the company. The annual sales in 2011/12 for Tesco were 65.17bn. taboo of this figure 42.8bn were produced from UK and showed a rise of 5% and the online sales of UK rose by 10% in this time period. 3.0 Importance of capabilities and how they contribute to competitive advantage at Tesco. 3.1 Capabilities, Strategy, Competitive Advantage and RBV The competitive rivalry forces have lessened the margins of profit for the supermarket chains and also the suppliers. Famous loyalty card of Tesco known as Clubcard clay the mainly booming strategy for customer retention that considerably raises Tescos profitability. To retain the customer base Tesco meets the customer needs, customizes the service, ensures lower prices, helps in making bettor choices, continuous flow of in-store promotions. In grocery industry the substitute of need and the product for product concept is very common (Ritz, 2005). An accelerated development take has been fostered by this hi ghly competitive market, this results in a situation for innovation for UK grocery retailers in order to maintaining and building market share. Innovation like this underside be seen in the development of a range of trading formats, in reply to transformation in consumer behavior. The main market leaders respond by focusing again on the value and price, while also reinforcing the elements of value addition of the services they 3.2 3.2 Tesco Competitive Advantage As Tesco is giant retailer, so in order to get a sustainable competitive advantage they must follow any one of the three generic strategies mentioned ahead. Cost leadership is the starting time strategy that Tesco can use to get the lowest of all the costs in the same industry (Palmer, 2004). Cost leadership strategy is likely to be