The grocery market in Ireland is comprised of three distinct types of retailer: The symbol groups - retailers who own their store but who trade under a group name such as Spar. The independent retailers - those who operate their own outlets independently. The Irish Times, Tesco is the leader of supermarket multiple sector as well as the whole grocery market.
Own Determination from the data given The above diagram shows a graphical presentation of return on equity for Sainsbury and Tesco supermarkets.
From the diagram, there is an indication that Tesco has higher returns on equity within the three-year period. This is owed to its diversified investments in other sectors such as financial sector, real estate investments.
Ultimately, effective investment decisions by Tesco doubled by the huge proceeds from the investments have increased the level of returns within the company.
The information that use in this report is secondary data and also different techniques, analysis such as PESTEL analysis, SWOT analysis, Marketing mix analysis, market segmentation, targeting analysis etc are used to discover Tescos marketing position in national and international place. For Example: doing a comparison between Tesco’s and British airways can get us thinking about how dependent Tesco is on the UK market (% of revenues.) or doing a comparison of Tesco with Amazon might bring out flaws in its challenge to move into new markets. Finally, Tesco provides leaflets at the entrance. There is a price list which comparing the prices in Tesco with its main competitors and images for low price products which aim to stimulate shoppers. Geographic and Customers. Tesco of Carlow is set in the FairGreen shopping centre in the centre of the town with convenient traffic and car parking.
The net margin Source: Own Determination from the data given From the graph above Tesco still shows great ambience in its performance in terms of its profitability compared to Sainsbury. Notably this increase in the profit margin is attributed to the efficient management of expenses and good strategies of marketing of its products to maximise on the sales.
Sainsbury has been recording low volumes of sales revenue compared to Tesco with numerous retail outlets in the United Kingdom to boost the sales revenue. In addition, Sainsbury low sales revenue can be linked to poor methods of products promotion, which lead to minimal sales revenues.
Tesco has effective methods of collective trade receivables, which boosts the collection of debts owed by customers to the company.
Furthermore, it is definite that Tesco has done well in areas of risk management especially with the diversification of its businesses, which improves its ability to invest and expand the market outlets of its products.
Apparently, as noted from the introduction, it is also evident that the retail outlets by Tesco exceed by a bigger margin those of Sainsbury. Liquidity Ratios Liquidity ratios demonstrate the ability of the Comparing the marketing of tescos and audi essay to meet its short-term obligations with the available short-term assets.
This is exhibited by two main ratios; the current ration and the quick acid ratio Gibson, The current ratio The current ratio shows the ability of the company to meet its short-term liabilities with the available liquid or current assets.
The ratio is found by the formula; current assets divided by the current liabilities. From the diagram above it is evident that none of the companies was able to achieve a current ratio of 1 for the last three years. This is a risky observation for the company.
Notably it is recommended that a company should have a current ratio of more than one but not more than two. Even though none of the two companies was able to achieve a current ratio of one in the food retail industry, Tesco showed a greater prowess in its results by having slightly better current ratio compared to Sainsbury.
Eventually the customers might lose trust in the supermarkets if products cannot be supplied in time. There are possible reasons that might have contributed to this observation in the trend of current ratio for the last three years.
It is possible that both companies are having excessive orders of inventory, which is held by the company against the diminishing demand for the products.
Besides, it is also possible that the low current ratio is owed to increase in payables for the company which increases the amount of current liabilities to be payable.
Excessive inventory, poor methods of marketing or product promotion, which leads to low movement of goods and services, has a greater impact on the flow of inventory.
Furthermore, Tesco and Sainsbury might be experiencing a slow pace in the collection of accounts receivables, which lead to, held up of funds in the company. Own Determination from the data given Quick Ratio Similar to the Current ratio, the quick ratio, which shows the ability of the firm to meet its short-term debts by use of liquid cash without cash, the results from the calculations, does not show much to be desired from the two large scale supermarkets.
Sainsbury has a declining trend in the quick ratio. This is not a good sign for the company.
This is an indication that the liquid cash at the disposal for the company is limited which might be attributed to the low level of collection of receivables. As a result, the company has much to do in terms of establishing the best ways of collecting its trade receivables such as use of discounts.
Tesco on its hand, even though it has a better edge over Sainsbury, it has much to act on in connection to the management of its liquid assets. Leverage Ratio Interest coverage ratio Interest coverage ratio shows the ability of a business to repay or service its loans with the net income from the operations.
The diagram below shows the interest coverage ratio for the two large chain supermarkets. Own Determination from the data given Tesco demonstrates a high ability to repay its interest expense with the acquired operating income.
It should be noted that a ratio under a figure of one implies that the firm is experiencing challenges in generating adequate cash flows to meet the interest expenses hence the recommended ratio must be more than 1.
In this case, Sainsbury is highly at risk of going under solvency owing to the observed trend in the interest expense ratio for the last three years. This is because the firm can barely manage to cover or meet the costs on interest rates, which might easily lead into bankruptcy of the company.
Besides, it is an indication that its earnings or revenues are at risk given that it can be used to repay the full loan in case of default Ulwick, Debt to asset ratio This is a metric used to determine the financial risk of a company by calculation the quantity of the assets by the company that has been utilised to finance debt Beyer, This is determined by adding a long term and short-term debt and finally dividing the results by the total assets of the company.
In the event the ratio falls below one most assets by the company are financed though equity and if it is more than one it is an implication that the assets of the company are financed through debt financing.The German chains Aldi and lidl are discount retailer and fight with the big four rival’s called Tesco, Asda, sainsburey, and Morrisons.
The two discounters have to do a lot of work while competing rivals. Essay about Comparing Two Advertisements - Comparing Advertisements For this comparison I have chosen to compare two car adverts. The first advert I chose was from the car magazine "Autocar" and this is an advert for a Chrysler PT Cruiser.
It is clear that Tesco can record the expected positive outcomes and have to compare them with the actual results. It can make Tesco familiar with the current performance and appropriateness of their strategies for international marketing.
The first Tesco was opened in by a man called; Jack Cohen from that 1 store Tesco has grown in the market and now has stores worldwide, Tesco is a supermarket that sells all kinds of household items such as food, clothes range, technology range, phone range furniture, toys and many more, Tesco has many different stores which make a lot.
Marketing Techniques Essay. Charli Allardyce unit 3 Marketing is the process of communicating the value of a product or service to customers. Marketing might sometimes be interpreted as the art of selling products, but selling is only a small fraction of marketing.
Tesco PLC Report contains more detailed discussion of Tesco marketing strategy. The report also illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on Tesco.