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1.

What were the reasons behind Tesco’s internationalisation
strategy?
2. What factors might be considered in assessing Tesco’s
performance in Thailand and South Korea and in
comparing/contrasting their performance to that in
Taiwan?
3. In the light of the above cases, consider Tesco’s entry to the
United States of America as ‘Fresh & Easy Neighbourhood
Markets’, How does the United States case fit against the
criteria for success and failure that have been examined in
the Asian cases (above)?
4. Use the PESTEL framework (see Section 2.2.1) to evaluate
Tesco’s internationalisation strategy/

. What were the reasons behind Tesco’s internationalisation
strategy? Answer 1
• External environment drivers of
internationalisation, in this case, include:
– growing regulatory
– pressures arising from market dominance in the
United Kingdom and higher rates of growth
– potential in emerging markets in Central Eastern
Europe and East Asia.


Answer 1
• Organisational capability drivers include:
– Tesco’s widely acknowledged competencies in
– market/site research, customer-led marketing,
supply chain management, financial control,
– distribution and logistics.
• Market drivers
• Cost drivers
• Government drivers
• Competitive drivers

Answer 2 What factors might be considered in assessing Tesco’s
performance in Thailand and South Korea and in
comparing/contrasting their performance to that in Taiwan
• Factors to consider include:
– Partnerships with domestic conglomerates
– Determined efforts to build scale and accrue
market leadership advantages
– Format flexibility and adaptive responses to
regulatory pressures
– Competitive advantage derived from within-firm
knowledge transfer


Answer 4-Use the PESTEL framework (see Section 2.2.1) to evaluate Tesco’s
internationalisation strategy/
• Political – concerns about market dominance of Tesco in its home market leading
in part to consideration of alternative growth avenues overseas. Tightened
regulation in East Asia has been responsible to a degree for format flexibility.
• Economic – potential of growing markets for international expansion. Fast growth
in East Asia, but also considerable growth in metropolitan markets of Los
Angeles/Phoenix/ Las Vegas in the United States of America.
• Social – Significant social and cultural shifts such as dual career households, ‘time
poor’
• consumers and rising levels of consumer education have grown the market for
convenient but healthy meal options as well as raised awareness of the health
implications of foods with ‘transfats’ etc. As Fresh & Easy, Tesco has capitalised on
these social trends in order to grow market share.
• Environmental – concerns about growing environmental impacts of CO2 emissions
etc. have led to the enhanced potential of neighbourhood/convenience retail in
the United States of America and the recognition of this potential in Tesco’s market
entry.