Small businesses might come into the market and participate in convenient accessibility, locality, specialty, and other reasons. The threat of new entrants in the retail business is usually high as even in the presence of retail giants, and emerging store businesses can simply enter the market. Therefore, the risk of substitutes in the retail sector is minimal.
The use of advanced technology and the influence of online shopping and e-commerce have changed the way of doing business and making more aware (Pantano et al, 2017), but it cannot be termed an alternative for retailing. Furthermore, some alternatives are more costly than the store’s low-cost items & services. However, the differentiating factor of a limited selection of substitutes makes it difficult for customers to switch away from Super chains-branded products. There are a few alternatives to retail stores products that are commonly accessible. The threat of having substitutes is typically low in the retail industry because, in order to meet the demand and supply of groceries and other food products, retailers are considered key players. Hence the existence of such big names in the industry makes the environment more competitive for each other in terms of operations. In comparison, others are fighting behind with 15.7, 14.1, 10.3, 7.7, and 6.3 percent of the grocery market share, respectively (Statista, 2021). As of December 2020, Tesco is considered the consistent market leader in terms of the grocery market share of 27 percent. The major competitors of the group are Sainsbury’s, Asda, Morrisons, Aldi, and The Cooperative. As a result of this increase, a number of groups and companies have captured the market to provide multiple platforms for the customers to purchase from, resulting in fierce competition among established players. The competitive rivalry in the retail industry is high due to the community’s increased demand for and supply of commodities to meet basic needs. From the global retail industry perspective, the assessment of Porter’s five forces would be a practical means for maintaining appropriate strategies to better understand the company standing position.
The firm is operating over a vast network of around 7000 locations worldwide. As of 2019, the corporation showed substantial revenue of 64.760 Billion Pounds and has involved an employment figure of almost 423,000 (Tesco, 2020). In context to the retail segment, the company was founded in 1919, having its headquarters in Hertfordshire, England, United Kingdom. Tesco Plc is a British public limited company dealing in the retail industry and providing services in the form of supermarkets, hypermarkets, and superstores across the country and other areas of Europe.
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