1. 0 INTRODUCTION In our research report, we aim to understand how Tesco UK does their marketing activities. The marketing activities include the way Tesco UK does their segmentation, targeting and positioning (STP) so that they can know where to concentrate their commercial efforts. By doing so, the organisation’s resources can be effectively and more efficiently utilised. Not only that, we also look into Tesco UK’s assessment of current situation with respect to the marketing environment which consists of economic, competitive, technological, sociocultural and political and legal forces.
This assessment is done to enable Tesco UK to modify their marketing strategies and plans so as to stay relevant in this ever dynamic environment. Lastly, analysing the creation of Tesco UK’s marketing mix: product, place, price and promotion that strives to match with the needs of their customers in the target market. 2. 0 COMPANY BACKGROUND Tesco UK, United Kingdom, is one of the entities under the group, Tesco plc. The core business of Tesco is in UK although they have expanded to all the other places such as Eastern Europe and China, Malaysia, Thailand and Japan.
Tesco UK is a British multinational grocery and general merchandise retailer. Aside from groceries, household or even electrical items, it offers also services such as banking, insurance and telecom. It started trading in 1924 by Sir Jack Cohen. To date, it has 2715 stores with around 290,000 employees in the UK, making it to be the core business contributing to the group. Around 60% of the group sales and profits come from the UK operations. Since March 2011, Richard Brasher was appointed to be the Chief Executive Officer for the UK operations.
Tesco’s philosophy is to deliver great shopping experience to its customers in every store that they go to. They believe in “Every Little Helps” and reward its customers with more savings in Tesco when they use its Clubcard (a Tesco customer loyalty program). 1 3. 0 SEGMENTATION, TARGETING AND POSITIONING (STP) Segmentation, Targeting and Positioning (STP) process is a method in which the whole markets are divided into different segment. With the obvious rising of mature market, he diversity of customer needs, and the ability to capture the niche segments, the use of STP is more frequent (Oxford University Press 2012). Segmentation: Data collected from the Clubcard helps Tesco to do their segmentation. Tesco UK has segmented their customers using the demographic variable which is income of the customers. This demographic variable-income helps Tesco to determine which customer will be able to afford its different products range.
For example, Tesco Finer Foods and Tesco Organic are developed for upmarket group with more disposable income while the Tesco Value is for the price sensitive or less affluent market. Another demographic variable used is the family life cycle. People inevitably go through different stages of life and need different product to cater for every stage in their life. Tesco UK has developed many product lines targeting at high income earning singles and busy lifestyle with Tesco “meal for one” range. While, the Tesco Value products are for families who wants cheaper products that usually comes in multi-packs.
As the family grows larger with children, Tesco UK brings in many baby products such as baby cot and baby stroller with different brands to their customers. Aside from segmenting their customers demographically, Tesco UK also segmented their customers based on geodemographic segmentation. Tesco UK engages information companies such as ACORN (A Classification of Residential Neighbourhoods) to get geodemographic data so that Tesco can use micromarketing to determine the right merchandise mix for their individual stores.
In other words, Tesco can tailor their products and services to the local customers in every store. Targeting: Once the market segments are identified and evaluated, marketers decide which segments to target so that organisational objectives can be met (Hult, Pride and Ferrell 2012). To help in the selection of target market, Tesco UK uses a differentiated targeting strategy with a marketing mix for each of its segments. This means the marketing mix for their upmarket segment is different from the marketing mix for their less affluent segment.
The marketing mix for upmarket segment would have higher pricing, higher quality product, more promotions or advertisements is needed and available in more affluent area. For example, Tesco Finest products are developed from the above mentioned marketing mix. Equally, the Tesco Value products has its own marketing mix as well because these products targets people with less disposable income and for people who are looking for just reasonable value 2 and quality products.
A differentiated targeting strategy chosen by Tesco UK is good because it enables Tesco UK to capture a larger market by targeting and offering different products for different segments. Positioning: Having done the above two steps – segmenting the market and selecting specific target market, positioning a brand within the target markets is the final part of the STP process. Tesco UK’s positioning goes by the tagline of ‘Every Little Helps’. They believe that every little help rendered by them would hopefully make the shopping easier for their customers.
This can be seen where they go the extra mile to customize their website to be user-friendly so that customers can save time, money and get the most out of the ordering from online. Tesco UK wants their customers to always remember that Tesco UK would try in every little ways to help their customers and this unique characteristic of Tesco UK distinguishes it from its competitors. By doing so, customers of Tesco UK can always be assured of the best deals or offers that they are getting. 4. 0 MARKETING ENVIRONMENT The environment in which business operates is increasingly dynamic. Marketers need to be ready and respond to even any slight changes in the environment so as to stay competitive in the market. The marketing environments consist of political, legal and regulatory, competitive, economic, technological, and social. Political and Legal Factors Government legislation and policies have a direct impact on the performance of Tesco.
For the employment legislation, the government encourages retailers to provide jobs opportunities, the combination of flexible, low wages and the locally-based jobs to highly skilled, high income and the centrally-located jobs. It can meet the demand from population categories, such as the work of students, parents and the elderly. Tesco understood the great impact of the retail on work and human factors because development of new stores tend to destroy the other traditional retail stores termination of business or forced to cut the cost ompetitiveness on inherently local and labour-intensive sectors. Tesco employs large numbers of students, disabled and older workers by paying them a lower interest rate under the National Minimum Wage Act 1998, 28 paid holidays, and no longer working hours than one consents to under the Working Time Regulations 1998, the right to leave for child care, and the right to request flexible working patterns under the Employment Rights Act 1996.
The Equality Act 2010 ensures people are judged by the content of their character, and not regulated characteristics such as race, gender, sexuality, beliefs, disabilities or age (Bc. Petr Gola 2011). In an industry is a typical high staff turnover, these workers provide a higher level of loyalty, therefore, represents the ideal employees. In order to achieve the politically correct pricing policies, Tesco also provide consumers with the purchase of fuel price reduction amount based on the spending on groceries in its stores, although the price cut promotion of goods to compensate elsewhere in the store price. Economical Factors Economic factors are concerned about Tesco, because they are likely to affect demand, costs, prices and profits. The most influential economic power of one of the factors is the high level of the unemployment rate, thereby reducing the effective demand for many commodities and affecting the demand for the production of such goods. These economic factors are basically beyond the control of the company, but far-reaching impact on the performance and marketing mix.
Tesco would seriously affect any slowdown in the UK food market and the market wills concentration exposure. From Tesco’s results were announced on the day that the UK’s GDP figures were revised down from growth of 0. 2% to 0. 1%, according to the Office of National Statistics. Data from the ONS also showed that household consumption fell 0. 8% in volume terms between April and June. At current prices, consumption was up 0. 1% but slowed from the 1. 2% seen in the first quarter of the year (Best. D 2011).
Social Factors Demographic changes such as population aging, the decline in the increase of female workers (Refer to figure 1) and preparing meals at home means that the UK retailer value-added products and services focus. The type of goods and services demanded by consumers is their social adjustment and their subsequent attitudes and beliefs function. Consumers are increasingly aware of health problems, their food is constantly changing. Tesco to adjust its product mix example in order to meet the demand for organic products increases.
The company is also the first time allows customers to pay in checks and cash checkout. Technological Factors Tesco using the technologies of the wireless devices, intelligent scale, Electronic Funds Transfer Systems (EFTPOS), and other technologies was greatly improve efficiency of distribution and stocking activities with needs being communicated almost in real time to the supplier because the technology is an important macro-environmental variables, which has affected many of the Tesco product development.
The new technologies benefit both customers and the company, customer satisfaction increase because goods are readily available, services can become more personalized and shopping more convenient. 5 Competitive Factors Asda Stores Ltd. is a British supermarket chain which retails food, clothing, general merchandise, toys and financial services. It also has a mobile telephone network, (via the Vodafone Network), Asda Mobile. Its head office is at Asda House in Leeds, West Yorkshire.
Asda became a subsidiary of the American retail giant Walmart, the world’s largest retailer, in 1999, and is the UK’s second largest chain by market share after Tesco (Asda 2012). J. Sainsbury plc (LSE: SBRY) is the parent company of Sainsbury’s Supermarkets Ltd, commonly known as Sainsbury’s, the third largest chain of supermarkets in the United Kingdom. The group’s head office is in the Sainsbury’s Store Support Centre in Holborn Circus, City of London. The group also has interests in property and banking (Sainsburry’s 2012). Asda and Sainsbury’s they are two major competitor of Tesco company.
Tesco understand achieve development in a competitive market, only innovation can continue to maintain their status so Tesco provide its own brand to the market and it make Tesco have been far ahead of the competition. Price competition is the commonality of the supermarket, but more advanced competition occurs at the brand level, which is a more profitable level, and represents the future trend of competition. For instance, if you shopping in the large supermarket, in order to buy cheap goods may have to carefully compare the repeated attempts.
However, in the UK, you simply select the Tesco’s own brand products, this problem can be solved. At present, Tesco in the global expansion, “value for money” series is the flagship in a series of pioneering market launch of the “own brand” products. Right now, the supermarket “own brand” strategy popular in all countries, not only become a magic weapon of the major supermarkets in the fierce competition, but also opened up a third battlefield in the global retail competition 6 5. 0 MARKETING MIX 5. 0. 1 Product Product refers to the goods, services or idea received in an exchange (Hult, Pride & Ferrell 2012).
Tesco UK provides goods such as clothing, groceries, baby products, toiletries, pet products, health and beauty products and etc. As for services, Tesco offers financial services (Tesco Bank), mobile service provider (Tesco Mobile), online shopping service (Tesco Direct) and online bookstore (Tesco Books). Nowadays, Tesco products are not just limited to their own retail brand-private store brand such as Tesco brand itself but their products have expanded to include other product brands such as ‘F&F’ and ‘go cook’ as well as their pillar brands such as ‘Finest and Value’.
In any company, they should place an emphasis on the importance to the product or service as well as the other aspects associated with the products that capture the customer attention. The elements in their product or service should contain the followings: Quality, packaging, brand name, features, options, safety, repairs, support, services and warranties. The other factor to consider when designing the product is whether the customer needs and requirements are met. Tesco Value – Quality: These range of products claim to offer the best price to its customers without compromising on the quality.
Stringent checks are also done on all its value products; ensuring they are safe and good for consumption. Tesco Value products are aimed at people with family and want better savings on products. The basic needs of these types of customers are satisfied through the wide range of Tesco Value products being offered. To Tesco, Value does not always mean limited options. An estimate of 800 types of Tesco Value products are available for them to choose. With the wide variety of Value products, they are trying to beat their competitors who are also selling budget items.
The taste of their value mushrooms is still good despite of their imperfect look. Besides that, their value cheddar cheese is still cheddar but is just comes in less flavour options and different sizes compared to their more expensive alternatives. Packaging: The packaging of their Tesco Value product is simple so to reduce cost. Tesco Value items are family packaged with a similar packaging for all of these products with a common design element consisting red, blue logo and a white background with some 7 pictures relating to the specific product (Refer to figure 2).
This type of design or packaginguniformity and simplicity design gives their customers an easy way to distinguish their Tesco products against so many other competitors’ products. Besides that, Tesco’s packaging is also environmental friendly as the marketers pledged to fine the balance between minimal packaging and the supply chain. Example: Tomato puree tubes no longer come in cartons, reducing packaging by 45 per cent, the caps on two litre bottles of carbonated drinks have been reduced, saving 603 tonnes of plastic a year and etc. Not only that, Tesco products are effectively packaged to facilitate in storage, transportation and handling.
Example: Double concentrated squash (non-alcoholic syrup) enables Tesco to sell it in lighter, small and more portable bottles – less packaging and less logistics to transport the product. Labelling The nutrition labelling is on the front of the product so that consumers can view it directly instead of looking at the back for the product label. Their nutrition labelling uses Guideline Daily Amounts (GDA) and tells consumers how many calories and how much sugar, fat, saturates and salt they will eat in one serving, together with the percentage GDA for a typical adult (Refer to figure 3).
The marketers design this nutrition labelling to be clear & legible with good font-size and type unlike some competitors’ nutrition labelling font size & type being too small and difficult for viewing. Branding Tesco brand is constantly evolving and recently the popularity of their Pillar brands such as Tesco Finest has pushed Tesco Value into second place as the largest food brand in UK ahead of Coca-Cola. More and more people are buying the Finest range on a frequent basis thus making it an important component of Tesco sales mix.
Besides that Tesco’s branding has extended to include financial services such as provided by Tesco Bank. Tesco wants to seen as innovative to its customer and to build better confidence level in their customers by delivering different kinds of products and services. 8 5. 0. 2 Place Marketing channel Since Tesco UK is a retailer, it uses this type of marketing channel – starting from producer to retailers and ending with consumers (Refer to diagram 1). That means they buy directly the large quantities of products from producers.
This helps to pass more savings to Tesco’s consumers because Tesco does not have to go through so many intermediaries like agents and wholesalers before reaching to them. Formats of stores & locations Generally, Tesco UK is classified under general merchandise retailer. Their brick and mortar shops can range from small sized convenience stores to big hypermarkets. They come in multi-format to suit different customers’ need around UK like Tesco Express, Tesco Extra, Tesco Superstores and Tesco Metro.
Tesco Express: A type of neighbourhood convenience store developed on Esso petrol station forecourts. Their products are mainly food and everyday’s essential items. Tesco Extra: A hypermarket that sells products in bulk so as to offer cheaper price to consumers. It targets small business owners. Tesco Superstore: A large retail outlet that carries all the products found in supermarkets as well as most consumers’ products purchased on a frequent basis. It offers a wide a complete food range but only limited non-food products. It is normally found in out-oftown location.
Tesco Metro: The size of store is between Tesco superstores and Tesco Express It focuses on convenience food, takeaways and lunch items. Found in High Street locations and targeting city centre office workers who wants a quick shopping either for food or products. 9 Store image The exterior atmosphere in Tesco UK especially in the element of parking spaces is good with enough or large parking spaces for its customers. The exterior building is painted mainly in a theme of white, red and blue. All stores carry the big, bold lettered Tesco signage in bright red and blue which makes easy recognition for people even from a far.
While the interior atmospheric elements of Tesco consist of good, bright white lighting, air-conditioned environment and an organised retail display with proper signage of many categories of products (Refer to figure 4 for both the exterior atmosphere and interior atmosphere of Tesco UK) Direct marketing Tesco UK uses direct marketing in their nonstore retailing such as e-commerce websites: (1) Tesco. com (for groceries & fresh foods) and (2) TescoDirect. com (for non-food products) and also the m-commerce (Tesco’s Android application for smartphone users). These are the online retailing besides their traditional brick-and-mortar store.
The move to do online retailing is to be able to operate on a more massive scale with a larger distribution of network. The Internet technology allows the customers to get their products easily and save time. Besides that, Tesco UK can also save on the rental cost of its brick-and-mortar store. In the direct marketing, e-catalogue is used to help the consumers to make selections and place orders via the e-commerce or m-commerce. The e-catalogue consists of a list of products available for purchase with complete pictures, prices and description of the products.
Clear shopping instructions to place order are shown in the catalogue marketing (Refer to figure 5). Retailer plays an important role in the supply chain management because they are both the marketers and customers for the producers (Hult, Pride and Ferrell 2012). Efficient transportation of goods from the producers to the Tesco’s depot and lastly to the Tesco’s stores is necessary. Tesco UK uses the railroad and lorries to deliver their products and stocks. To reduce the carbon emission by their lorries, Tesco are using more of the trains instead of lorries to transport the goods. It is a commitment by Tesco to be a zero carbon when 2050.
Tesco UK has a rail terminal with 1. 5 km of rail in 3 rail sidings, capable of loading and unloading 8 trains per day (Tesco-careers 2009). This service saves a lot of time and cost of petroleum that are very expensive these days. It also helps protect the environment. 10 5. 0. 3 Price Nowadays with the economic recession in UK, many people are losing their job and this makes their household income to drop. Their purchasing power of goods or services may be affected by this problem. Those affected, would be constantly on a look out for any cheap bargains and offers that might help them to alleviate the worsening problem.
Tesco UK has addressed this problem by listening to the view of 200,000 customers and decided to cut the price to help the customers to cope with the economic recession (Tescoplc, 2011) On 22 September 2011, Tesco had announced their pricing strategy which is Tesco’s Big Price Drop. This pricing strategy brings exactly the help and benefits needed by many customers and their families (Refer to figure 6). Tesco UK reduces the pricing for most of the products that customer need to buy everyday such as milk, vegetables, fish, breads, fruits and so on.
With the price reduction, customers can buy more with the same value of money and also focus on the products that families need most. Affordability is the key component that the customers are looking for and not expensive or luxury products. In this situation, Tesco’s own brand such as Tesco Value products became very popular as these products serve exactly the needs of the customers. Apart from this, Tesco UK also uses the everyday low price (EDLP) strategy. By the everyday low prices strategy, it may attract many customers at low prices. This can let the customers to endless price comparisons that mark shopping expeditions.
EDLP also help the customers to spend less cost in every day. (Refer to figure 7) Besides that, Tesco also promoted bundle pricing strategy for the customers. This means Tesco package two or more items, often complementary to each other to be sold at a single price (Refer to figure 8). This bundle combination allows Tesco to push more of their goods to the customers especially for the slow-moving products. Not only that, customer loyalty can also be fostered in this way because customers’ needs are satisfied by providing them with different bundles of products to suit them.
Furthermore, Tesco provides odd-even pricing strategy to their beloved customer. Odd-even pricing is a strategy that sets the product’s price at odd number rather than setting at even number. For example, the Olay Gentle Cleansing Face Wash sold at Tesco UK is priced at £0. 97 instead of £1. 00. Another example is the Robs Double Concentrated Orange squash is also oddly priced at £3. 65 instead of £3. 70 (Refer to figure 9). Research suggested that buyers 11 will be influenced by the odd pricing products as they consider it as a bargain- not £1. 00 but £0. 7 and there is still change after buying this Olay Gentle Cleansing Face Wash. Not only is that, multiple-unit pricing strategy is also one of the pricing strategies that has been deployed by Tesco UK. Customer can purchase two or more same type of products and get a lower price for it than buying individual products. For example, Tesco’s wash up liquid is priced at £0. 85, but with multiple-units; any 2 of the Tesco’s wash up liquid cost only £1. 20. Customer can save £0. 50. (Refer to figure 10) Tesco UK has also priced some of its products according to a special event. This technique is called the special-event pricing.
This is done to generate more sales by capitalizing on the special event or occasion. An example is Tesco UK offering discounted prices or special offers for some of its product just for the upcoming Mother’s Day celebration. (Refer to figure 11) Price lining has also been adopted by Tesco UK as one of their pricing strategies. Price lining is whereby products or services within a specific group are set at different price points. This can be seen where Tesco UK offers gifts with different price range. (Refer to figure 12) Buy one get one free (BOGOF) is one of the types of promotional pricing.
Tesco is able to win more customers by doing so as an industry survey shows that supermarket shoppers respond very favourably to BOGOF. (Refer to figure 13) 12 5. 0. 4 Promotion Many organisations are using the promotion variables to attract the customers. Promotion can be defined as activities used to inform the society about their organisation products. The main purpose of promotion is to attract the public’s attention about an organisation and their selling products and any new products available. Besides that, the main purpose of promotion is to give information about the products to their potential or loyal customers.
Therefore this increases the quantity demanded of a product and distinguishes a product from their competitors. There are many ways to promote a product for instance, sales promotion, public relations, direct email, trade fair and exhibitions, advertising, viral marketing, street teams and etc. The Clubcard has being provided by Tesco UK under the membership scheme which helps the customers to save money while shopping (Refer to figure 14). Customers will get a point on every pound they spend while shopping at any branches of Tesco.
Customers can convert their points into Clubcard vouchers when the customers successfully collect 150 points which help the customers save a lot of money while shopping. Actually the other retailers also have the similar loyalty programs. Nevertheless it is intriguing to note that about most of the loyalty schemes and relationship marketing strategies which are similar to the Clubcard have often failed by the other retailers, only the Tesco’s Clubcard has worked well and managed to succeed. In fact, the Clubcard will indirectly motivate and encourage the customers to buy more products at Tesco and Tesco can earn more profits in this way.
Sales promotion is being thought of as all promotions apart from advertising, personal selling and public relations. For instance, buy one get one free (Refer to figure 15), coupons, competitions, free sample products and gifts. Every sales promotion should be compared and well planned with the next best alternatives. Tesco UK has held many promotional activities to attract potential customers and their loyal customers, such as discount up to 70% on clothing sales with F&F, Half term bid day out (2 for 1 offer), 10p Off Per Litre.
In addition, when customers spend £60 on groceries, fantastic half prices, Tesco store clearance up to 50% discount, £10 off when spend £40 on clothing, save 15% off entertainment and etc. Fair trade is an international trade movement that focuses on providing better trading conditions for poorer producers in developing countries, protecting them from volatile markets. The fair trade collection will be priced the same as the current range, with T-shirts retailing at £4. Tesco UK will also launch an organic cotton range under its Cherokee fashion 13 label.
They offer the opportunity for companies to meet with both the trade and the consumer. Through this, Tesco UK is promoting its own image as a responsible retailer who does fair trading. This indirectly encourages more customers to come and buy products from Tesco if they want to also show their support for fair trade (Refer to figure 16). Communication was ‘paid by’ advertising. Advertising is the way of transmit information to consumer. There are many advertising being implemented such as newspapers (Refer to figure 17) (local, national), online news portal, magazine, television, cinema, outdoor advertising etc.
In magazine, that have voucher inside for consumer such as Dolls House Magazine and Esquire magazine. Those magazines have Clubcard voucher worth £16 to £117 as gift. Tesco has advertised many promotions in the newspapers for instance Tesco broadband triple Clubcard points exchange £40 in Clubcard vouchers for a 4 hours driving lesson package with RED Driving school. Besides that, Tesco UK advertises their products through the Internet. For example Tesco Direct. com is a secure, easy website that offers lots of great deals.
Customers can enjoy free delivery or the next day delivery that charges a small fee from customers who need the item urgently. Consumers can also take advantage of a huge range of discounts on not just the groceries, but on electrical equipments, wines, books and much more by shopping online at Tesco UK. 14 6. 0 PROPOSALS Tesco should consider the importance of another segment which is the high spending customers. Examples in UK Waitrose, John Lewis (parent company of Waitrose), Selfridges and Marks and Spencers rely on this trade or segment to thrive. These companies are still making a profit.
Tesco could also concentrate more in this area for further growth in their business. Tesco UK can emulate its Korean counterpart, Homeplus (A joint venture between Tesco & Samsung) in having virtual supermarket in bus stops and train stations. The bus stops and train stations are plastered with images of products offered in Homeplus (Refer to figure 18). Interested buyer will just have to scan the QR code found on each image of the products that they want to buy using their smartphones and place an order and later the groceries will be delivered straight to their home.
All the customers have to do is just download the special Tesco application to their smartphones and they can start shopping already. Aside from venturing into financial services (Tesco Bank) or the telecommunication services (Tesco Mobile), Tesco UK could probably venture into the higher education sector. They could partner with other reputable academic institutions to provide with cooking course or even business course such as retailing. For examples Tesco can use their unsold vegetables and food products to be used as ingredients in the cooking school.
Today, higher education is highly valued in this globalised world. More and more people are in the rat race to get a good paper qualification. Although Tesco’s concept is self-service but they could still hire some knowledgeable or well-informed personal assistants to help customers make selections on the especially expensive products such as electronic products sold at Tesco. Tesco can hire more talented people to work for organization. The skills needed from them are to help the organization to come out with better strategic plans for further reducing operating costs, advertising cost and marketing cost and etc.
They can also offer bright ideas to improve on the current inventory control system of the organization and on how to provide excellent service to its customers. Since Tesco is a large private employer, Tesco can create a happy working environment for its employees by providing more benefits and always care for employees. Happy employees can serve the customers better. This helps to boost Tesco’s image as a great employer and as a grocery retailer that provides excellent service to its customers. Although, Google is in a different industry, but Tesco can still follow some of Google’s way 15 f keeping their employees satisfied. Always keeping customers happy and fully satisfied would help make Tesco to be the market leader. Tesco should also really consider its objective on whether to attract more customers to benefit or whether to make every effort to keep its existing customers. It is more costly to an organisation to attract new customers than retaining their existing customers. 7. 0 CONCLUSION Despite Tesco UK’s claims on having the world’s class operations and processes which include marketing, the reality is the market environment is very volatile.
This can be seen from their most recent marketing strategy of ‘Big Price Drop’ which unfortunately did not go well with their strategic plan because Tesco UK’s share price fell sharply. Competitors such as Asda and Sainsbury were quick to respond to such scheme by hatching up with similar plans. Customers did not respond well to Tesco’s Big Price Drop as they had hoped for. Sometimes, we think that we might have the best marketing strategies but external forces from the environment does ot allow us to have total control of what we want to achieve. Contingency plan is necessary when things do not go well. The contingency plan should address the current problem that they are facing as winning back customers should be a priority even if it means to give up on the profits in the near term, if we were to look at, how Tesco might benefit in the long term. Along with contingency plan, they should always strive to resolve any long-standing business issues if they want to remain as one of the leaders in the retailing position in UK.