Tesco PLC is the third largest British multinational retailer in merchandise and grocery. In 1919 Tesco began its first step when Jack Cohen made a profit by selling surplus groceries from a stall in an East End of London. After five years in 1924, Tesco became a brand name by the initial letter of Cohen and Mr. T.E Stockwell is a merchant from whom Cohen buy the tea. IN 1929, Mr. Cohen opens the first Tesco store in Burnt Oak, North London. To become the top retailer in the world, Tesco showed its eagerness by the acquisition of its rival shops.
Tesco diversified into various businesses like books, clothing, electronics, furniture, petrol, financial services, and internet service. Tesco company is rank as the largest online superstore in the world. It also offers financial service such as credit card and car insurance policies to millions of people. According to the data of 2018, Tesco has 6966 stores worldwide.
Having the strong experience in the home country UK. Expansion to overseas was inevitable through acquisition, merger with local firms. However, the success of the Tesco company in the international market was due to the knowledge of its local culture of host countries and the market environment. They offer the local market according to their needs and wants with the help of partnership, mergers, and acquisition.
They wanted to expand their business more aggressively in world’s second-biggest economy, Japan. In 2003 the Tesco PLC enter Japan
Tesco entered the Japanese market in 2003 by acquiring the C Two-Networking Company which was a discount supermarket chain.
Failure and consequences Failure and consequences
High cost and customers demand were difficult to meet by the Tesco supermarket.
The country has many family-owned and long-established grocery store, and they respect for the personal touch, kindness they offer.
In Japanese culture, they prefer high quality of product as well as services to be offered during their shopping. But due to the big size of the Tesco store, it was impossible to provide a high level of customers services to every shopper.
Consumers moved to private label product which is affordable instead of branded luxury product.
Japanese love to buy the western product from USA and Europe to show their social status.
The shopping habit of Japanese were totally different from UK people as UK consumer enjoy in doing a big shopping whereas for Japanese space value is more so carry out big shop is not an option.