Market Entry Strategies Case Study

Tesco in Japan – Experimenting with Retail Formats

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Abstract:

Tesco, UK's leading supermarket group, as part of its international expansion, entered Japan by acquiring the Tsurukame convenience stores operated by C Two-Network, a local retail player. Tesco later acquired Fre'c, another retail chain, to consolidate its position. Japan was the second most lucrative and mature retail market in the world. The Japanese consumers were finicky and even the biggest names in global retailing had suffered setbacks. Carrefour, the world's second-largest retailer, quit Japan in March 2005 and Wal-Mart, the world's largest retailer was struggling to make significant gains there. But Tesco was confident of small supermarket and discount store formats, popular among Japanese consumers. In 2008, Tesco rolled out its Tesco Express convenience stores (up to 50 stores), offering fresh and processed food. Tesco's total store count in the cities of Tokyo, Kanagawa, Chiba, Saitama, Gunma, Nagano, Shizuoka, Aichi, Kyoto had reached 130 outlets. Whether Tesco's experimentation with different retail formats could bring-in the expected growth in Japan remained to be seen.

Pedagogical Objectives:

• To study the components of the retail business in Japan.
• To analyse the critical success factors of the retail grocery business in Japan.
• To evaluate Tesco's strategies in Japan.

Keywords :  Tesco; Japan; Retail formats; Tsurukame; C Two-Network; Tesco Express stores; Retail industry in Japan; Convenience stores; Supermarkets; Hypermarkets; Carrefour in Japan; Wal-Mart in Japan; Second largest retail market; Seven-Eleven Japan

Contents : 
The Japanese Retail Scenario
Evolution of Various Retail Formats in Japan
Square Watermelons in Japan
Top Ten Supermarkets
Retail format Opportunities
Tesco’s Entry Into Japan
Tesco's Strategies
Convenience Stores