When Tesco, Britain’s leading retailer, entered the U.S. market in 2007, it did so with great fanfare. The company invested heavily in an aggressive expansion plan, opening stores across the country and entering into a joint venture with Safeway, one of the largest supermarket chains in America.
Tesco’s entry into the American market was seen as a major threat to established players such as Walmart and Kroger. However, despite its early promise, Tesco failed to make a significant impact in the United States and pulled out of the market in 2013.
There are a number of reasons why Tesco failed in America. Firstly, the company underestimated the level of competition. The American grocery market is highly competitive and Tesco was up against some very strong rivals.
Secondly, Tesco was late to enter the market. By the time it arrived, Walmart and Kroger had already established themselves as the dominant players.
Thirdly, Tesco’s expansion plans were too ambitious. The company opened too many stores too quickly and this put a strain on its resources.
Fourthly, Tesco made some poor strategic decisions. For example, its joint venture with Safeway was not successful and it also failed to take advantage of online grocery shopping, which is growing in popularity in the United States.
Finally, Tesco was hit by the global economic downturn which affected consumer spending in America.
In conclusion, Tesco’s failure in America was due to a combination of factors including intense competition, poor strategic decisions and the global economic crisis.
Why did Tesco fail in America?
Tesco’s failure in America was due to a combination of factors including intense competition, poor strategic decisions and the global economic crisis.
