Our strategy

In 1997, Tesco set out a strategy to grow the core business and diversify with new products and services in existing and new markets. This strategy enabled us to deliver strong, sustained growth over the past 14 years. We’ve followed customers into large expanding markets in the UK – such as financial services, general merchandise and telecoms – and new markets abroad, initially in Europe and Asia and more recently in the United States.

In order to reflect changing consumer needs and the increasingly global nature of our business we’ve evolved our strategy. The strategy now has seven parts and applies to our five business segments – the UK, Asia, Europe, the United States and Tesco Bank.

To grow the UK core

The goal ‘to grow the core UK business’ is as relevant today as it was in 1997. The UK is the largest business in the Group and a key driver of sales and profit. There are many opportunities for further growth and so we will continue to grow the UK core.

To be an outstanding international retailer in stores and online

Another of our original goals was to be a ‘successful international retailer’. In 1997, our international businesses generated 1.8% of the Group’s profits. Today they represent 25% and we’re now either number one or number two in eight of our 13 markets outside the UK. So we’re already ‘successful’. Our next step is to be an outstanding international retailer in stores and online.

To be as strong in everything we sell as we are in food

In 1997, we were largely a food retailer so we set ourselves the challenge of becoming ‘as strong in non-food as in food’. As our business has grown and we offer an ever wider variety of products to customers, the term non-food no longer does justice to all the products and services we sell. We now aim to be as strong in everything we sell as we are in food.

To grow retail services in all our markets

Our services businesses have come a long way since we first included in our strategy the desire ‘to develop retailing services’. Today these parts of Tesco generate £583 million profit, representing 16% of the Group total. To date this has been largely UK-focused, but as many of our international businesses have now established well-known brands in their local market, it is time to expand our ambitions and aim to grow retail services in all our markets.

To put our responsibilities to the communities we serve at the heart of what we do

In 2007, we added a fifth element to our strategy to underpin our commitment to communities and the environment. We’ve updated this objective slightly by emphasising our responsibilities in these areas. Our goal is to put our responsibilities to the communities we serve at the heart of what we do.

To be a creator of highly valued brands

The first is to be a creator of highly valued brands. Our brand has evolved from a logo above a few stores in the UK to a multitude of store, product and service brands across the world. Building brands gives our business more meaning with our customers. On one level, this relates to our Retail brands such as the Tesco brand itself, but it also refers to our Product brands such as F&F and Technika and our Pillar brands such as Finest and Value.

To build our team so that we create more value

Our final goal is to build our team so that we create more value. As our business continues to grow and diversify we need more leaders to run the many substantial business and support functions within the Group. Our leaders not only have an important role today, but also have a responsibility to help build a bigger and better team for the future.