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Tesco, one of the largest retailers in the world, has been under performing in recent Screen Shot 2014-11-11 at 10.06.41 PMyears and, in an attempt to draw more investment, overstated its profits by 250 million. The scandal, which has caused an all out investigation, has dropped Tesco stock and market shares even lower.

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Price per Share from Sept 29 – Oct 2

 

 

Tesco currently faces the challenge of both retaining consumer loyalty and dispelling share holder concerns.

However, there is chance for Tesla to stabilize. On the consumer side, Tesco needs to prioritize consumer satisfaction and after-sale services as recent goals to expand internationally have caused Tesco to cut staff drastically. This is perhaps the main reason that services in UK has been neglected.

On the investors side, there lies a problem with trust, as shareholders who are more knowledgeable of the scandal, will probably be cautious of reinvesting into Tesco. In fact, a prominent investor said:

I made a mistake on Tesco. That was a huge mistake by me.”                                                                                                                              -Warren Buffet

Tesco needs to straighten its image and changing its image won’t be easy as Trout and Rise expressed in their book Positioning: The Battle For Your Mind; thus I believe that Tesco should focus on recapturing consumer market instead of appealing to investors.

 

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