Analysis of Resources, Capabilities, and Core Competencies of Tesco

Tesco is the 3rd largest retailer in the world measured by profit and 5th largest

A source of finance used by Tesco is retained earnings. Tesco re-invest a certain percentage of their end of the year profits back into Tesco, so they can improve it. Each year Tesco decide how much money they re-invest, this depends on the profit they make.

Tesco’s financial year represents the 52 weeks that ended 27 February 2007, which is prior to 53 weeks that ended 28 February 2009. In accordance with the International Financial Standards (FRS) were the consolidated financial statements prepared. The statements were also prepared in agreement with the Financial Reporting Interpretation Committee (IFRIC).

Yahoo! Finance (2012) describes Tesco PLC as a company that "operates stores that primarily offer food products, as well as general merchandise, clothing products, and electrical products." In addition to that, Tesco PLC is also involved in the provision of insurance, financial as well as banking (retail) services (Yahoo! Finance, 2012). Taking into consideration the number of branches it has in various parts of the world, Tesco PLC can be regarded one of the largest retailers around the globe. Having been established sometimes in the year 1919 by Jack Cohen, the company has surely come a long way (Tesco, 2012). The phenomenal growth of Tesco PLC over time can largely be attributed to both the unwavering vision of the founder and the selection of a competent team of managers to run the company's operations during its growth phase. Currently, the company top management team comprises of its CEO Andrew Clarke, its Chief Financial Officer Laurie Mcllwee and Tim

At its current status, Tesco’s entire revenue of 60% is from the host country (UK) and 40% from its twelve client countries. It possesses ninety-seven years of revolutionized supply chain management skills and advantages as it competes with its local & offshore local competitors such as Asda, Carrefour, Aeon Jusco, Mydin, Giant and many more.

Tesco operates in 14 different countries. Therefore its performance may be influenced by the local legislation and political factors. There are

Tesco also sell non-food products such as electronic goods and clothing. The company group has recorded their revenues of £42,641 million during the year of 2007, and raise 8.1% over 2006. They also made a profit £2,648 million during the financial year of 2007, and raise 16.1% over 2006. The company net profit of £1,892 million within the financial year of 2007, and raise 20.5% over 2006.

Tesco is a British retail magnate trading at the London Securities Exchange. The company had several capital and quasi-capital transactions with providers of finance during the fiscal year 2008; had the effect of altering their capital structure and changing their Weighted Average Cost of Capital. During this financial year, Tesco was financed by retained profits, long and medium-term debts, capital market issues, commercial papers, bank borrowings and leases (Tesco PLC, 2012). The company generated £2611m cash from operating activities which helped finance their £3bn in capital expenditure, including £1899m profit which contributed towards retained earnings. The firm issued Medium-Term Notes (MTNs) worth £1213m which helped decrease the current MTNs, overdrafts and loans by £108m. Additionally, ordinary shares totaling £156m were released by the firm and entered into the sale-and-lease back leasing arrangements that released £454m from property, along with £650m after the balance sheet date. In addition, the firm returned value to shareholders by paying dividends of £467m and purchasing £490m of their own shares back.

Tesco is an UK-based company and operating internationally. The major business of Tesco is the grocery items general merchandising retail chain. It is the largest British retailer by both global sales and domestic market share. This company accounts for as the world 's third-largest grocery retailer. Tesco now holds over 30% of the grocery market in the UK. Its close competitors are Asda and Sainsbury 's. The company has diversified its operations in other areas as well such as discount clothes, consumer electronics, consumer financial services, selling and renting DVDs, compact discs and music downloads, Internet service consumer telecoms, budget software. They are now entering into the housing market, with a self-advertising website called Tesco Property

Tesco is a public limited company in the form of an international retailer, selling everything from fruit to personal computers to bicycles. Essentially, Tesco provides a link between the everyday consumer and the producers of aforementioned items. These items are sold in supermarkets of varying sizes.

This report will analyse the financial performance of Tesco PLC in order to gain an insight of the company’s financial health. To understand this, the CORE method of approach (Context, Overview, Ratios and Evaluation) will be employed.

Tesco is among the largest food retailers in the world with revenue in excess of £54 billion in 2009 and employing over 470,000 people . They operate approximately 4,331 stores in 14 countries around the world.  The company operates primarily in the USA, Europe and Asia and their

TESCO plc is reported as one of the largest retailers across the globe and is originally a UK based entity and operates in 14 countries across Europe, Asia, and North America with 5380 stores and employing around 472,000 individuals. TESCO provides "online services through its subsidiary, Tesco.com..The company sells more than 40,000 range of products including clothing and non food items. Tesco is headquartered in Hertfordshire, UK. The group has recorded £60,931 million revenue for the year ended February 2011, an increase of £4021million as compare to 2010 and £7816 million to 2009.Company earned a profit of £2627 million in comparison with a profit of £2336 million in fiscal year 2010 and £2138m in 2009." (Ghafoor, 2011)

Tesco has significant cash in the back and a lot of property in its portfolio,

Despite the recent blunders, Tesco is one of the many focused businesses enjoying long-term success. Their core vision enables them to carry out business strategies consistent with the changing markets and the ever-changing world environment. Tesco vision of the sort of company it aspires to be are as follows. To;