Evaluate the appropriateness of business information Essay
Evaluate the appropriateness of business information
In this task I will be evaluating the appropriateness of business information used to make a strategic decision. In this part of the task I will be focusing on Tesco business. I will be talking about the importance in strategic decisions within Tesco and how they use the decisions for their business. Also I will be evaluating how the strategic decisions affect the financial performance of Tesco. Tesco Price Promise Website:
Tesco uses the price checker to show customers that they are the cheapest supermarket out of the three leading supermarkets, Sainsbury’s, Morrisons and Asda. This is an important strategy for Tesco as they are able to gain customers as well as being competitors this leads to Tesco being able to make more profit compared to Asda, Morrisons and Sainsbury’s. Tesco has given this facility to people so that they are able to see where they have saved money and what they have got cheaper.
Tesco has mainly got the price checker facility for themselves and this would be so that they can see what they need to do to be able to gain more customers as they are able to see what there consumers like. Tesco’s provide information which is valid and up to date so that it is easy and fast for the customers to compare the prices of every product they buy. This strategy is used to create marketing plans which then leads on to the strategic decisions made for Tesco. This is done by using the information as part of their marketing plan which will gain customers and maintain their business. Tesco Price Promise Receipt:
Tesco doesn’t only provide their customers with the facility to go home and check on the internet how much they are saving but they also give their customer the opportunity to check how much they have saved compared to Asda, Morrisons and Sainsbury’s. This is done when they buy 10 or more items, they would automatically compare your final prices with the other supermarkets and give you two receipt of which one contains your main shopping list and prices and one says you have ‘£ (something amount) off your next shop’ and this something amount is the amount of money you have saved in your shopping that same day.
You are given two options at the bottom of the receipt which is where you can go to the customer service desk and get a voucher for the amount you have shopped of using the code go onto online. Most importantly Tesco is giving the chance for you to do everything while shopping this is an advantage towards the customers as they would not want to go home and go through a long process whereas they can do it fast and much more easily. This increase profits the profit within the business as Tesco is providing you with products for cheaper and helping you. This also becomes more competitive against a rival as they have a way to increase customers and steal the customers there rivals have. This concludes to a positive financial performance as Tesco are gaining customers and earning a profit compared to other supermarkets. Tesco Club Card:
Tesco has a club card facility, and this is a card which can be kept as a key ring as well as a card in your wallet. This allows you to gain points every time you shop at Tesco. This is also beneficial to Tesco as well because they are able to see what you have bought in your shopping basket and according to that they send you vouchers on your most bought items, allowing you to buy more. Also they give you vouchers so that you come back to Tesco as your shopping would be cheaper than it normally is, this attracts customers as they are saving money on their shop and this is what they want. This information Tesco is gaining helps them as they are able to achieve more customers so this increase the rival competitors and they are also gaining an increase in profit and customers due to the fact more people are shopping at Tesco and using the services they provide, this also means Tesco are able to develop even more. Tesco’s financial accounts from 2011-2012
The image above shows the financial highlights of Tesco within the world and the image on the right shows the financial highlights of Tesco in the UK. These figures reflect on the strategic decision as it would help Tesco to make future budgets and it also shows whether the services and facilities they have set up actually help make a profit for the business. Also it helps make long term decision like where they should expand next and how they would meet their aims. Also the price checker would has contributed to this as it has increased the amount of customers that shop at Tesco also it has shown people awareness of the Tesco business itself and this has increased the sales of Tesco which has been able to increase the sales revenue.
Overall, I believe that Tesco has many strategies and these strategies help Tesco to make further decisions on what they will be doing as they would be aiming to increase profit, and become the better rivals. Tesco’s financial performance is getting better due to the better strategic decisions made within the company to increase profit and gain customers. Tesco uses the clever tools for them to be an effective company so that financial performances increase, which allows marketing plans to be made. This allows Tesco to create their strategic decisions, proving the information is appropriate.