Tesco from Domestic to Multinational

Q3. What factors might be considered in assessing Tescois performance in Thailand and South Korea and in comparing/contrasting their performance to that in Taiwan? 1) Mode of Market Entry : After the Asian economic crisis in 1997-1998, it left major domestic conglomerates urgently looking for help. Therefore, Tesco could enter Thailand and South Korea via a joint venture of the local business partners which would help them to survive through the crisis and at the same time Tesco could get support from them. For example, the local partners could share knowledge about local business conditions and consumer cultures. While Tesco in Taiwan, tried to enter the market by using ‘de nuovo’ expansion which means Tesco would start its business from the beginning. 2) Local Partnerships : In Thailand and South Korea, Tesco was able to find good business partners, the CP Group in Thailand and Samsung in South Korea. While Tesco in Taiwan were unable to find a suitable local partner as they had done in Thailand and South Korea. So it was difficult for Tesco to adapt consumer buying behavior culture in the country. 3) Existing competitor : In Taiwan, Carrefour had assumed complete and strong market dominance over a decade. Carrefour had already developed attractive sites for expansion so it is difficult for Tesco to compete with it in the market. And this was not the case in Thailand or South Korea. 4) Market scale : Tesco was unable to build the market scale to support the substantial infrastructure investment. While in Thailand and South Korea, Tesco could make substantial capital investment to build market scale and increase market leadership advantages. 5) Land ownership: In the case of Taiwan, the highly complex chinese land ownership system caused difficulties to develop market location analysis, and property acquisition. 6) Adaptive responses to growing pressures across East Asia : In Thailand, Tesco faced the restrictions on hypermarket development. Therefore, Tesco…

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