Tesco in the United States
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Case Code : BSTR291
Case Length : 13 Pages
Period : 2005-2008
Pub Date : 2008
Teaching Note :Not Available
Organization : Tesco
Industry : Retail
Countries : USA
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Tesco started as a market stall set up in 1919 by Jack Cohen, who began the venture with the ₤30 that he received when he retired from military service. The first product that he sold was tea. The company was called TESCO - a combination of the initials of T.E. Stockwell, the owner of the tea supply firm, and the first two letters of Cohen...
Tesco's International Ventures
Tesco began its international foray in 1979 when it entered Ireland by acquiring
a 51 percent stake in 3 Guys stores. However, the venture did not succeed as the
customers rejected the British products sold in the stores.
In the early 1990s, with the domestic market stagnating, the company again
started to explore international opportunities. In 1992, it entered France by
acquiring an 85 percent stake in Catteau S.A, a supermarket chain...
Tesco in the US
Tesco had been eyeing the US market for a long time - even
from as far back as the 1980s, according to some reports. However, serious
efforts to enter the US market began only in the 2000s. In mid-2006, Tesco
reportedly sent around 50 senior officials from its British operations to live
with American families "recruited" by the company in California so that they
could study the shopping and consumption habits of these families...
The research that Tesco had carried out in the US had
thrown up the fact that US shoppers looked for neighborhood stores that
stocked fresh, healthy and inexpensive foods. "When we talked to people,
and went into their households, we heard a fairly consistent message.
That message was that what people wanted was fresh, affordable food -
wholesome food - but they wanted it close to home." Therefore, it was
decided that Fresh & Easy would differentiate itself from other
retailers on convenience, freshness, and affordability...