Tesco Porter's Five Forces Analysis

Porter’s Five Forces Model
The Porter’s Five Forces tool is a framework that simple but powerful tool for an organization to analyse and understanding where the power lies and the level of competitive within an industry in their business situation. It is useful for Tesco in Malaysia because it helps them to understand their current competitive position, and the strength of a position that they considering moving into. These five forces should be undertaken to find the effective sources of competitive advantage. Therefore, with objective of the analysis of the competitive environment of Tesco Malaysia, the analysis of Porter’s Five Forces as follow:
i. BUYER POWER
Bargaining power of buyers of Tesco in Malaysia is rather high. In cases when

Because it’s requires with huge capital of investments to be competitive and create a brand. The basic brands which have already mastered of retail trading in food stuff are Tesco, Econsave, Carrefour, and Giant Hypermarket. Thus, there are difficult for a new company of grocery retail market to enter except they can make something at extremely in low price and high quality to establish their market. This forces power is affected by the ability of people to enter your market. If the products that offered by a company are nearly identical and the economies of scale that can be easily achieved, it is easy for others competitors to enter the

This strategy are required an industry to offering and create something special or new that is perceived as being unique compare with others competitors in the same marketplace. Whether the features are authentic or just in mind of the customer, they must perceive the product as having desirable features and fitting their lifestyle that not commonly found in competing products. For example, the differentiation strategies may include warranty which are Tesco can bring in or create own brand product and stuff like bag, accessories or electronic that is special and unique and also have the same grade of quality with others branded product. Besides, Tesco also can cooperation with others branded product to create new goods together to satisfy customer’s desirable features for instance Gucci, Nike, Apple or Samsung. This method will make a firm’s products less susceptible to cost pressures from the competitors because there are some customer are willing to pay extra fee to have the product with the acceptable request when they see the product is unique and difficult to find in other place. If Tesco work together with others brand, it may come out with the more unique and distinctive product compare with others competitors because the products couldn’t have sell in other market or store. Despite this, the cost of the differentiated product will be higher than non-differentiated products. Thus, Tesco