Tesco Essay Example | Topics and Well Written Essays - 1000 words

Tesco - Essay Example This move will deal with the bargaining power of clients so that clientele retention is attained in the supermarket sector. On the other hand, the supermarket should look into the switching cost to ensure that it is as low as possible. This may be accomplished through loyalty card or otherwise smartcards (Zentes, Morschett & Schramm-Klein, 2007, p. 85). In this case, loyal customers will earn discount points whenever they shop in the Tesco supermarket and in that case strive to shop more. The supermarket hence, should introduce more incentives to consumers. Similarly, motivation for customers can be achieved through the involvement of an upcoming sport which serves not only as a promotional strategy but also as a social responsibility. Every initial purchase in the food products should go hand in hand with discount vouchers to retain clients. On the other hand, the supermarket should consider bargaining power of competitors. It should be noted that the supermarket sector has grown si gnificantly and therefore dominance goes with large players in the business sector. For this reason, the supermarket sector of Tesco has to move into greater store and increase retailer concentration. This has to use a wide range of formats to gain the required dominance in the market scale. Since the purchasing power in the food industry today is concentrated on small numbers of retail buyers, the corporation should operate in a mature market. This implies that the supermarket should move into gathering important data on client preferences so that they can handle the increasing sophistication among consumers (Zentes, Morschett & Schramm-Klein, 2007, p. 94). Branding and reputation is as well an imperative idea to be embraced by the company. In such a case, Tesco supermarket should strengthen its brand through quality services to consumers. Branding has to maintain quality throughout their packaging activities. This will reduce competition as well as confusion among buyers (Zentes, Morschett & Schramm-Klein, 2007, p. 99). Similarly, there should be product and service re-engineering to enable better management of the food product lifecycle and efficiency in delivery. Based on this activity, the sector should focus on enhancing core ranges as well as introduction of quality products to clients. It is also recommended that the sector integrates IT in its operations. This follows the fact that contemporary business operations are in an increasingly dynamic and complicated environment. Innovation in the supermarket will be of great help to move the company from one level to another. In any section of the business, systems of control stock, inventories and delivery records are core to profitability of the business (Zentes, Morschett & Schramm-Klein, 2007, p. 100). The supermarket should therefore, focus on extranet systems to enable the sector utilize the internet in creation of proprietary and personalized information dissemination between the section and its part ners. The last thing this supermarket should consider is supplier management. Research indicates that Tesco relies on goods from overseas in which case suppliers are competitive on prices. The company should therefore, use many suppliers from around the world to reduce chance of shortage in supply. The relationship with suppliers, however, should be unique to gain their trust. Budget Distribution Summary Because of the ever increasing completion in the â€Å"