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This report will therefore analyze what extend of effect that ecommerce and technology can make on retailers, taking Tesco as a case study.

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Introduction

1. Introduction Change occurs from time to time and is inevitable to all organisations, notably technology. It is undeniable that E-Commerce is a useful tool for companies to break the restriction on area, time and space to expand their business. Electronic commerce is about ?the whole online process of developing, marketing, selling, delivering, serving and paying for products and services transaction with the support of worldwide networked? (O?Brien & Markas, 2011). Tesco may be a good example of how business integrates in-store and E-Commerce well through technology development. This report will therefore analyze what extend of effect that e-commerce and technology can make on retailers, taking Tesco as a case study. It will first of all describe the business modal of Tesco. Secondly, an assessment of Tesco?s competitive environment will be analyzed. Finally, two new recommendations will be given to adapt to Tesco?s potential growth. 1. Business Model Timmer (1998) defines the ?business model? as an architecture for product, service and information flows which encompasses descriptions of the roles and the potential benefits of the different business actors and the sources of revenues. In other words, business model is a summary of how a company is going to generate revenue by identifying customer needs, organising resources and etc. According to Appendix 1, Tesco?s business model is divided into three vital parts ? core activities the virtuous volume circle and enablers ? whilst the core purpose is to build the valuation of customers to gain their eternal loyalty. ...read more.

Middle

1. Opportunities It not only provides customers an enjoyable shopping experience, but also gives Tesco another breakthrough point to improve its e-commerce service to retain old customers as well as attractive new customers. For instance, online shopping is becoming increasing popular since more customers prefer to shop without stepping foot inside a grocery store (Hartman Group, 2012). Online shopping module can create a convenient and enjoyable experience for customer. On the other hand, it can expand the customer base to remote area and break the restriction on storage space. Furthermore, companies can collect data easily for analysis so that they can find out customers? shopping habits and preferences to set new strategy. Overall, high-tech use is a win-win tool for both companies and customers which gives Tesco potential growth opportunity. 1. Threats With competitors developing innovative IT, not only at an incredibly fast speed, but also at various range of service, Tesco is having the risk of lagging behind at some point. For instance, to compete with Tesco, Sainsbury has launched a new technology called brand match since 2011(J Sainsbury plc, 2012). Brand match helps customer to check prices of their products with those of Tesco and Asda immediately. Customer will get a receipt which shows the differences of prices and will be given voucher if the goods are more expensive than the same one in Tesco or Asda. For Marks and Spencer, the entity has installed an initiative called browse and order point across 40 stores in UK in the first half of 2012 (M&S, 2012). ...read more.

Conclusion

Duke University, Cisco?s success case study, has saved 2.5 million annually in communications system support costs and extended interactive classroom experience to people (Collaboration Case Study, 2011). Therefore, Tesco can combine IT with international operations development (IOD), which response for the company?s business processes, provide continued monitor and support by assisting global organisation and optimise model. It can help Tesco lower 20% of administrative costs, such as traveling fee, in order to simplify operating structure thus motivates faster decision making and increased profit. 1. Cumulative Benefits Tesco will gain significant benefits from its early use of collaboration tools, particularly the productivity benefits in its expansion of the international operating model. The impact on the business is expected to be substantial over time, in terms of faster time to market, improved productivity and cost reductions. Moreover, Tesco can anticipate greater value from the more structured approach which will come from its embedded collaboration framework. Conclusion Tesco, a multi-national company, has become the 44th largest company around world by implementing its business model that contain three vital parts ? core activities the virtuous volume circle and enablers. The current situation of Tesco in this competitive atmosphere can be identified by the SWOT analysis, which reveals both advantages and potential threats, including improved shopping experience in both shops and online by applying the edge-cutting technologies, and some threats from competitors as well. Nevertheless, external and internal collaboration will ensure the future development, utilizing the up-to-date technologies, such as increasing of and analysing on conversion rate, using of modern communication tools and implementing advanced online management system will helps Tesco progress in the right direction and in a leading position in retail business. ...read more.

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