The UK’s grocery retail sector is one of the most competitive and fierce in retail. Over the last decade, the UK’s grocery retailing landscape has transformed radically, especially emergence of the Germany and Scandinavia deep discount retailers such as Aldi and Lidl in early 1990s.
Hard discount retailer have very distinctive approach than UK’s traditional grocery retail such as Tesco, Sainsbury, Walmart-Asda and Morrison and were lead onto UK by these Traditional retailer which enjoyed high profit margins at the time and they recognised the Gap in the market in terms price and spatial gap in terms of the most deprive area in UK’s towns and cities.
By 2015, Germany discount retails have grown record level which followed a period of gradual increase number of store and most favourable trading characteristics even given recession and global financial crises between 2007 and 2009 (Thompson et al., 2010). Having reached record sales, by end of 2014, Aldi and Lidl’s sales have grown by 22.6% and 15.1% and 4.8% and 3.6% market share respectively. On the other side, big four traditional retail Tesco lost sales 1.2%, J Sainsbury 0.7% and Asda and Morrison both 1.6% as well as 1.2% market share in combine (FT, 2015:1).
The success of German discount retails has become main concern in UK’s traditional retails. Aim of this paper is to investigation the impact of discount retailers on traditional retailers in UK because German discounters not only direct impact on traditional retailers’ market share, also put pressure on increasing operational efficiency and or decreasing prices (Harvard Business Review, 2006 and van Heerde et al. 2008) which lead this paper’s second aim to analyse should existing traditional retailers develop new flexible business model like Walmart (Jia, 2007). Having successful business strategy, it still begs a question what is the future of this German discounter, third aim of this research paper is to investigate can they (German discounter) be able to beat big four UK’s traditional retailers like what Walmart did in US (Jia, 2007) and Ryanair did British airways (Ruddick, 2014).
Due to having time and words limitation, this paper will only focus Tesco in terms of UK’s traditional retailer and German discounter Aldi.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- AIM and OBJECTIVES
- LITERATURE REVIEW
- METHODOLOGY
- Finding and Analysis
- Impact of discount retailers over traditional retailer Tesco in UK:
- Flexible business model:
- Comparison Aldi strategy with Tesco:
- Inter-company format change:
- Future of Discount retailers:
- CONCLUSION
- Impact of discounter:
- Flexible model:
- Future of discounter:
- APPENDIX-1
- APPENDIX-2
- APPENDIX-3...
- References:
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This research paper investigates the impact of discount retailers on traditional retailers in the UK, specifically focusing on the influence of Aldi on Tesco. The paper aims to analyze the strategic implications of discount retailers, explore the necessity for traditional retailers to develop flexible business models, and assess the potential future of discount retailers in the UK market.
- The impact of German discount retailers on UK traditional retailers.
- The need for traditional retailers to develop flexible business models to compete with discounters.
- The future prospects of discount retailers in the UK market.
- The role of price competition in the grocery retail sector.
- The evolving consumer behavior in response to discount retailers.
Zusammenfassung der Kapitel (Chapter Summaries)
- Introduction: This chapter provides an overview of the competitive UK grocery retail landscape, highlighting the rise of German discount retailers like Aldi and Lidl and their impact on traditional retailers like Tesco. It emphasizes the need for a comprehensive understanding of the implications of this shift.
- AIM and OBJECTIVES: This chapter outlines the research's objectives, which are to examine the impact of discount retailers on traditional retailers, analyze the necessity for flexible business models, and evaluate the future of discount retailers.
- LITERATURE REVIEW: This chapter explores the existing research on the impact of discount retailers on the grocery retail sector, drawing on various studies and perspectives. It examines the competitive dynamics, consumer behavior, and strategic responses to the rise of discounters. It also discusses the concerns of traditional retailers regarding the potential impact of price wars and changing customer preferences.
- METHODOLOGY: This chapter outlines the research methodology, which primarily relies on secondary data sources such as annual reports, publications, journals, and internet articles. It acknowledges the limitations of relying heavily on secondary data and discusses the challenges of conducting primary data collection.
Schlüsselwörter (Keywords)
This research focuses on the dynamics of the UK grocery retail sector, specifically examining the impact of discount retailers on traditional retailers. Key terms and concepts explored include discount retailing, traditional retailing, price competition, flexible business models, consumer behavior, market share, and competitive strategy. The research investigates the influence of German discounters like Aldi and Lidl on UK retailers like Tesco, analyzing their strategies and the implications for the industry.
- Quote paper
- Md Mahabubur Rahman (Author), 2015, Critical analysis of the influence of discount retailers on Tesco plc in the UK, Munich, GRIN Verlag, https://www.grin.com/document/318301
