If fair-trade cotton clothing offers a good product for money it will get a good reception in Germany. This can be used for marketing campaigns to drive advantage towards the demographic base for future growth and sustainability.
Changes to consumer buying behaviours require further analysis - as technology develops consumer buying patterns change which will result in product areas requiring evaluation. Rising raw material costs from both food and non food will impact profit margins overall.
Acquisition is a risky move, and Germans are averse to risk. This is financially debilitating. Strengths TESCO has won numerous awards for its retail excellence, customer service, and overall shopping experience. Emerging markets still hold numerous opportunities for certain retail formats that TESCO already offers but that can provide better access to the western goods these areas demand.
Weaknesses TESCO Finance profit levels were impacted through bad debt, credit card arrears and household insurance claims.
Increasing fair-trade cotton clothing prices can lead to lower sales and lower profits for Tesco. Lower available income will impact and strategic focus may need to change to lower priced basic products with less focus on higher priced brands suggesting a switch in price architecture.
Sourcing changes to Far East locations with regards exporting restrictions on some non food product areas will reduce margin rates on products with already low margins. Its various store formats appeal to local and cultural needs, helping it offer a more personalised service experience.
It has improved the use of technology throughout its operations, creating greater cost efficiencies and enhanced service experiences.
TESCOs position as a price leader in UK markets can lead to reduced profit margins in order to retain the key price points on must have commercial items. It is considered one of the largest and most profitable supermarket and retail formats in the world, which many competitors have tried to emulate.
As a business looking for continued expansion TESCO have reserve funds of credit coupled with income derived from property portfolio development funds.
There are opportunities in the private label market. Food prices are on the rise around the world, which also reduces what consumers can buy and how much disposable income they have available.
The growth opportunities n Europe and Asia provides excellent opportunities for growth. The brand value of Tesco will work very well in Germany. Change in consumer buying patterns n the UK because of change in technology can lead to loss of customers in UK.
Opportunities There are opportunities for strategic alliances with other brands and admired companies to offer more products or attract more consumers in certain target markets. The retailer has a long-standing history in the UK, giving it credibility and assurance that it will continue to operate long into the future.
The business model that Tesco is using is suitable for UK and not for the rest of the world. Government regulations and the political landscape is also putting pressure on TESCO to adhere to new regulations that require them to make significant changes to their operating structure for additional expense.
The weaknesses of Tesco are that it is still largely dependent on UK for its sales. The company has significant cash reserves and a wide range of property in its portfolio yet undeveloped, which provides a strong financial position to weather all types of economic cycles.
Finally, international competitors like Wal-Mart could add a cotton line in Germany to compete with Tesco. Tesco can exercise a high degree of buying power to ensure that it has economies of scale in its fair-trade cotton clothing line. The low priced fair-trade cotton clothing could lead to price wars.
Consumers may not be buying as many items related to having less disposable income and the retailer has not adjusted its inventory and selection, leaving it with a high cost of inventory.
Even though Tesco sales are growing from low priced items there is fall in sale of non-essential and high priced products. Opportunities Statistics suggest TESCO is the third largest global grocer which indicates a level of buying power to ensure mainstream economies of scale.
In countries where TESCO may be underperforming, there could be opportunities for joint ventures in which the local company can help with market research and market intelligence to improve performance in those areas.Tesco SWOT Analysis – – Print Reference this.
opportunities and threats (SWOT). Strengths and weaknesses focus. on internal factors affecting a company; in contrast, opportunities and threats identify external issues (Collins, ).
Department of Marketing, Faculty of Business and Economics, Monash University, Australia.
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