Tesco.com - A Rare Profitable Dotcom
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Case Details:
Case Code : ITSY025
Case Length : 14 Pages
Period : 1990-2003
Pub Date : 2003
Teaching Note : Not Available
Organization : Tesco plc
Industry : Retailing
Countries : UK
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Please note:
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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Excerpts
A Unique Business Model
- The Ingredients of Success
The 'Pick-in-The Stores' System
The online grocery selling industry (in the US in
particular) had evolved around the concept of centralized, big
warehouses, where the merchandise was stored...
Delivering Excellence
After filling the shopping carts, the orders were
loaded into delivery vans. Commenting on the complexity of the
delivery problems Tesco faced, an analyst said, "If you have a van
going from a Tesco store to a dozen local customers, it is a
logistical nightmare.
You have got to choose the route so that you can do the drop-offs in an
efficient sequence, make sure you load the right food, picked in the correct
order, and then, if customers are out, you have the problem of not being able to
deliver the food." Tesco devised an elaborate mechanism for delivering
orders.... |
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Inventory Management
Tesco knew that one of the keys to managing a successful online selling
business was efficient inventory management...
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Customer Service
Tesco's personalized approach had another advantage. Just as retail stores
priced their products based on the area of operations (slightly higher
prices in posh localities and vice versa), Tesco varied its prices based on
the area to which a particular customer belonged.
However, the company took care to ensure that the prices still remained
competitive as compared to other retail/online operations offering their
services in any given area. Unlike many other online grocery sellers,
Tesco believed that it stood to gain by offering as many items through
the Internet as it did in its stores... |
Excerpts Contd... >>
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