tiểu luận the u k technology transfer subject business negotiation

Tesco offers a financial services website .... ASDA offers a financial services website.... Exports of goods and services % of GDP in the United Kingdom was reported at 32.72 % in 2022,

THE UNIVERSITY OF DA NANG - THE UNIVERSITY OF ECONOMICS

REPORT 1

“The U.K – Technology Transfer”

Subject: Business Negotiation (IBS3013_47K01.3)

Lecturer: Nguyen Anh Tuan Author: Group 4

Class: 47K01.3

The group’s members:

1 Tran Thi Ly Na 2 Duong Kim Ngoc 3 Nguyen Van Nhi 4 Tran Thi Quynh Nhu 5 Nguyen Ho Thanh Thao 6 Vu Le Anh Thu

Da Nang, 09/2023

ii TABLE OF CONTENTS

INDEX OF FIGURES v

INDEX OF PICTURES vi

I Overview of the UK’s Economy 1

1 An overview 1

2 Export from the UK 2

3 Import from the UK 4

4 Challenges facing the U.K economy 7

II Analysis of economic sectors with strengths of the UK 9

1.1.1 Tesco's offerings in terms of goods and services 16

1.1.2 Tesco group revenue in the United Kingdom (UK) 2015-2023 18

1.1.3 Tesco's SWOT Analysis 18

a Tesco’s Strengths 18

b Tesco’s Weaknesses 19

c Tesco’s Opportunities 20

1.3.1 Asda's offerings in terms of goods and services 25

1.3.2 Current state of the Asda company's business 26

1.3.3 SWOT Analysis of Asda 27

1.4.1 Morrisons offers a variety of goods and services 28

1.4.2 Current state of the Morrisons company's business 29

1.4.3 Morrisons SWOT Analysis 29

a Morrisons’s Strengths 29

b Morrisons’s Weaknesses 30

c Morrisons’s Opportunities 30

d Morrisons’s Threats 31

2 Choosing the potential partners: 31

IV Introduction about potential partners and introduction of technology 32

1 Introducing the partner 32

2 Introducing the technology 37

V Search for a sample contract and contract analysis 41

Article 1: Definitions and Explanation 43

Article 2: Transfer content of Agreement 43

Article 3: Form and Schedule of Transfer Technology 43

iv

Article 4: Process of implementing Cashierless Checkout Technology 44

Article 5: Equipment Supply 44

Article 6: Technical Document Supply 44

Article 8: Parties' Guarantees 44

Article 9: The Parties' Right and Obligation 45

Article 10: Checking and Taking over and Valuation 46

Article 11: Environment Safety and prevention of harm 46

Article 12: Limitation of Liability 47

Article 13: Term and Termination 47

Article 14: Value of Technology Transfer 47

Article 15: Schedule and Method of Payment 48

Article 16: Termination 49

Article 17: Force Majeure 49

Article 18: Confidentiality 49

Article 19: Taxes 51

Article 20: Safeguard of Parties’ Rights 51

Article 21: Settlement of Disputes 51

Article 22: General Provisions 52

Article 23: Applicable Law and Language 52

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v INDEX OF FIGURES

Figure 1 UK exports of goods and services over time (6) 3

Figure 2 Quick guide for standard imports (10) 6

Figure 3 The UK’s economic outlook has worsened since March 2022 (12) 7

Figure 4 Household incomes face a historically big hit (12) 8

Figure 5 The rise in economic inactivity has reduced the size of the labor force (12) 8

Figure 6 UK economic output by industry, 1990-2021 12

Figure 7 Detailed breakdown of jobs across major industrial sectors as of March 2022 14

Figure 8 Segmented private brand range of leading grocery chains (22) 15

Figure 9 Tesco group revenue in the United Kingdom (UK) 2015-2023 18

Figure 10.Table comparing the market shares of Tesco, ASDA and Sainsbury's 32

Figure 11 Tesco sales from 2015 to 2022 35

Figure 12 The best and worst UK in-store supermarkets of 2018 35

Figure 13 Total expenditure in grocery stores in Great Britain in 1st quarter 2015 to 1st quarter 2017, by grocer (in million GBP) 36

vi INDEX OF PICTURES

Picture 1 Tesco offers a variety of grocery products at the supermarket 17

Picture 2 Tesco's e-commerce website 17

Picture 3 Tesco offers a financial services website 18

Picture 4 Diverse goods at Sainsbury's supermarket 22

Picture 5 Sainsbury's e-commerce website 22

Picture 6 Sainsbury's provides financial services 23

Picture 7 Goods at ASDA supermarket 25

Picture 8 ASDA's e-commerce website 26

Picture 9 ASDA offers a financial services website 26

Picture 10 Diverse goods at Morrison's supermarket 29

Picture 11 Morrisons's e-commerce website 29

Picture 12 Tesco Logo 33

Picture 13 Tesco in Thailand and Malaysia 33

Picture 14 Tesco in China 34

Picture 15 Tesco in Korea 34

Picture 16 Tesco Clubcard 36

Picture 17 Tesco Community Champion supports local children and families with fruit and veg donations 37

Picture 18 Tesco - member of Champions 12.3 37

Picture 19 Tesco's store model 38

Picture 20 A customer uses an app to check the price 39

Picture 21 Scan as you shop handheld device 39

Picture 22 Self Service Checkout 40

Picture 23 Tesco’s ‘Broccoli Cam’ 40

Picture 24 Electronic shelf edge labels 41

1

I Overview of the UK’s Economy

The UK stands for United Kingdom, also known as the United Kingdom, which is an island nation in the northwest of Europe The United Kingdom consists of England, Scotland, Wales, and Northern Ireland, with a total land area of about 241,930km2 and a sea area of 1,680km2 along with a rich history and culture The countries of the United Kingdom are recognised as bordering countries, but still share the same currency and are run by the UK Government UK’s population is 67,783,238 people, which places it 21nd in the world (1)

1 An overview

The UK economy is a highly developed social market and market-oriented economy In addition, it is the sixth largest economy in the world in 2022 by nominal GDP - USD 3.10 trillion (2022) and the ninth largest by purchasing power parity (PPP) - USD 3.17 trillion The economy of the United Kingdom has the 21st largest GDP per capita, it is generating 3.3% of world GDP (2)

The United Kingdom is one of the most globalized economies constituted by the 4 economies of England, Scotland, Wales and Northern Ireland In 2019, the UK was the fifth largest exporter and importer in the world At the same time, the country is also the third largest attraction of foreign direct investment and the fifth largest outward FDI In 2020, trade between the UK and the 27 member states of the European Union accounted for 49% of its total exports and 52% of its total imports

The UK has long been involved in international trade It was a member of the European Union until 2020 and continues to maintain global trading relationships through bilateral agreements and memberships in organizations like the World Trade Organization (3)

2 In 2022, agriculture’s contribution to the UK economy (Gross Value Added at basic prices) was £13.9 billion (0.6% of GDP) The Utilized Agricultural Area was 17 million hectares, covering 69% of land in the UK (4)

The UK’s economy is dominated by services industries These include retail, hospitality, professional services, business administration and finance In 2021, services industries contributed £1.7 trillion in Gross Value Added (GVA) to the UK economy, 80% of total UK GVA GVA is a measure of economic output that is similar to GDP It measures the value of products and services produced minus the costs incurred in production (5)

London is a global financial hub, hosting major banks, insurance companies, and stock exchanges The financial sector plays a vital role in the UK economy, contributing significantly to GDP and attracting international investment

Despite a decline in recent decades, manufacturing remains an essential part of the UK economy The country has strengths in industries such as automotive, aerospace, pharmaceuticals, and machinery Manufacturing industries contributed £204 billion in GVA, 10% of the UK total The construction sector’s output was £124 billion, 6% of GVA

2 Export from the UK

Exports of the United Kingdom (UK) contribute an important part to the country's economy The UK is one of the world's largest exporters of goods and services Exports of goods and services (% of GDP) in the United Kingdom was reported at 32.72 % in 2022, according to the World Bank collection of development indicators Britain’s biggest export products by value in 2022 were gold, cars, turbo-jets, crude oil and medication mixes in dosage The UK’s top commodities suggest a diversified range of exported goods The United Kingdom ranks among world-leading nations for exporting aircraft parts, platinum and gold

3

Figure 1 UK exports of goods and services over time (6)

The UK's main export groups include:

1 Precious stones, precious metals: 96.2 billion USD (18.3% of total exports) 2 Machinery including computers: $74.9 billion (14.2%)

3 Mineral fuels including oil: $56.9 billion (10.8%)4 Vehicles: $40.6 billion (7.7%)

5 Pharmaceuticals: $27.8 billion (5.3%)

6 Electrical machinery and equipment: $ 27.4 billion (5.2%)7 Optical, technical, medical equipment: $20.2 billion (3.8%)8 Aircraft, spacecraft: $ 13.2 billion (2.5%)

9 Plastics, plastic products: 13 billion USD (2.5%) 10 Organic chemicals: $12.6 billion (2.4%)

The UK's top 10 exports approached three-quarters (72.7%) of the total value of global shipments (7)

In 2021, United Kingdom exported $50.6B in Precious Metals, making it the 5th largest exporter of Precious Metals in the world At the same year, Precious Metals was

4 the 4th most exported product in United Kingdom The main destination of Precious Metals exports from the United Kingdom are: Switzerland ($20.7B), Germany ($4.75B), Hong Kong ($3.44B), United Arab Emirates ($2.9B), and United States ($2.8B) (8)

In 2021, United Kingdom exported $3.71B in Computers, making it the 13th largest exporter of Computers in the world At the same year, Computers was the 15th most exported product in United Kingdom The main destination of Computers exports from United Kingdom are: Ireland ($887M), Netherlands ($468M), United States ($404M), Germany ($399M), and United Arab Emirates ($132M) The fastest growing export markets for Computers of United Kingdom between 2020 and 2021 were Netherlands ($242M), Ireland ($105M), and United Arab Emirates ($51.2M) (8)

Major companies such as ARM Holdings, BT Group and the BBC have helped the UK build a reputation for information and communication technology-related products

The UK has a number of prestigious automakers such as Jaguar Land Rover, Rolls-Royce and Bentley Automotive products are exported to markets across the globe

With the presence of companies such as Airbus and BAE Systems, the UK is one of the leaders in the production of aircraft and aviation equipment This product is exported to many other countries

The UK has several major pharmaceutical companies such as GlaxoSmithKline (GSK) and AstraZeneca, which produce medicines and health products that are exported to many countries around the world

London is one of the world's leading financial centres, with international banks and insurance companies The UK's financial services are also widely exported

Exports have an important role to play in maintaining the UK's trade balance and contributing to the country's economic development

3 Import from the UK

According to the Office for National Statistics, UK imports in October 2022 amounted to £51.8 billion, with £25.9 billion each coming from EU and non-EU countries (9)

The figures exclude the import of precious metals and non-monetary gold The top 10 commodities imported by the UK in the three months leading up to October 2022 are:

1 Mineral Fuels £8.7 Billion –2 Mechanical Appliances £6.4 Billion –3 Electronic Equipment £5.3 Billion –4 Precious Metals £4.2 Billion –

5 5 Motor Vehicles £4.1 Billion –

6 Pharmaceutical Products £2.0 Billion –7 Other Products £1.6 Billion –

8 Plastics and Plastic Products £1.5 Billion –9 Measuring Devices and Gauges £1.3 Billion –10 Knitwear £1.3 Billion –

Importing goods - standard process:

1 Determine who will be the importer into the UK - appoint a customs/import agent Check any POA before signing

Provide them with our EORI - Economic operator registration and identification number GB823847609000

instruct them to use postponed VAT accounting and to make standard customs declarations

2 Agree on terms and conditions with the supplier (including Incoterms®)Who will be the importer?

What mode of transport will be used?

What are the risks - are they adequately insured? 3 Determine the commodity code/goods tariff classification

Check the rate of duty applicable Are there any restrictions on the goods?

4 Establish if there is any import VAT or customs duty to pay 5 Are there any VAT/duty reliefs available?

Obtain necessary certificates e.g Medical Exemption, NIRU 6 Check if your goods require an import licence or certificate

Are they wholly or substantially originating in the EU? Obtain a certificate of origin from the supplier

7 Instruct the carrier/agent (clearance instructions) and provide documentation EORI - Economic operator registration and identification number

Commodity code and accurate description of the goods Controlled goods licences/certificates

VAT/Duty relief certificates Certificate of origin

6 8 Import entry declaration made by an agent to HMRC on our behalf 9 Transactions processed on CUFS and payments made

Figure 2 Quick guide for standard imports (10)

Basic import requirements The basic obligations are to:

Identify the commodity code Pay VAT

Complete VAT return Register with CHIEF

Clear goods imported using CHIEF Pay import duty where applicable

Check if licenses are required and obtain the requisite licence (11)Most of the time, importers can get their import VAT back HMRC might only permit authorized importers to guarantee the duty They must have a solid track record of paying VAT Import VAT accounting that has been streamlined (SIVS) The guarantee's sum may be decreased if authorized

At the designated port of entry, commodities enter the customs territory of the European Union and are then subject to EU customs rules They might be controlled by customs Changing the custom status is possible This could involve releasing anything onto the open market or going through another process, such as entering a free warehouse or free zone, for example Gqgds going into free circulation must be reported to the customs officials

7 4 Challenges facing the U.K economy

Figure 3 The UK’s economic outlook has worsened since March 2022 (12)

According to Johnson, policy and a lack of faith in the UK's stability are two factors that have contributed to the decline in global confidence in the UK economy since September Future government initiatives will often be motivated by a desire to rid the UK of the so-called "moron premium" that has been placed on it by global markets ever since the mini-budget

Lagging behind the rest of G7: The UK is the only G7 nation whose economy has not yet recovered to its pre-pandemic levels According to Johnson, there is no doubt that Brexit and the ongoing political and economic unrest have contributed

Inflation rising, household income falling:

Inflation is anticipated to decline very quickly in 2023 Johnson claimed that, in contrast to some media commentary, the volatility of energy prices accounted for just around a third of the UK's inflation issues

Household income in the UK is about to take a historically large fall (Figure 2) Without energy policy changes, this year would have been significantly worse for the average household income over the previous 70 years

8

Figure 4 Household incomes face a historically big hit (12)

Economic inactivity: The size of the UK labor force has decreased due to the rise in economic inactivity The main cause of this increase is the exodus of workers in their mid-fifties and older Rising economic inactivity has significant economic repercussions, including pressure on welfare spending, tax revenue, and the pensions sector

Figure 5 The rise in economic inactivity has reduced the size of the labor force (12)

9 In many ways, the UK is experiencing a "very strange recession" due to the country's extremely tight labor market The labor force is smaller now than it was before Covid The UK's predicament appears to be almost unique within the G7 in this regard Although large recent redundancies have been observed in some industries, such as technology, the UK is generally experiencing an "even" recession, with widespread small-scale income decreases rather than widespread unemployment

To summarize, the UK economy is experiencing problems to put it simply Inflation is still very high Since statistics began to be kept in the 1950s, household living standards have fallen by the most in two years In an effort to suppress demand, the Bank of England has increased interest rates to levels not seen in 15 years The mandate of thebank calls for taking demand out of the economy and bringing inflation back to its target of 2% The government's interest costs will increase when the high inflation rate causes higher interest rates As a result, the British government's financial situation deteriorated due to a significant rise in debt and slow economic growth (13)

II Analysis of economic sectors with strengths of the UK1 Agriculture

a Overview

Although agriculture contributes less than 1% to the United Kingdom's economic output, it plays a crucial role in supplying approximately three-quarters of our domestically produced food and occupies roughly 70% of the country's land.In addition to being vital to food production, agriculture helps shape landscapes and provides important recreational, spiritual and other cultural benefits This can be viewed in terms of providing important ecosystem services, where food production is a provisioning service, and other environmental and social benefits are provided through, for example, cultural and regulatory services

Agricultural production and associated land use and management are major contributors to the industry's environmental impact A key challenge is to decouple production from its environmental impact in order to reduce overall environmental footprint while increasing production Agricultural practices and the use of inputs (especially fertilizers and pesticides) have a direct impact on the environmental pressures generated by agriculture, including habitat quality, composition and availability, and impacts on air, water and soil

The main drivers of changes in agricultural environmental pressures in recent years have been reductions in livestock numbers, especially ruminants, and reduced use of fertilizers, especially on grasslands Reform of the Common Agricultural Policy, in particular the decoupling of subsidy payments from production, has played an important role in these changes These reforms made agriculture more responsive to market conditions, which had both positive and negative effects on the environment (14)

10 b Best Products/Prospects

Crops 1 Cereals

2 Wheat accounts for 41% of the country's food production- 3 Barley - used for beer industry

4 Oats5 Straw

6 Oilseed rape and linseed- cooking oil processing 7 Sugar beet

8 Protein crops (field Peas and field Beans) 9 Fresh vegetables

10 Plants and flowers 11 Potatoes

12 Fresh fruit (15) Livestock: 1 Meat production

2 Cattle and calves: beef and veal 3 Pigs and pig meat

4 Sheep and lambs: mutton and lamb 5 Poultry and poultry meat

6 Milk 7 Hen eggs

In the late 20th and early 21st centuries, the mainstay of British agriculture –livestock farming was hit hard by the mad cow disease epidemic and, soon after, foot-–and-mouth disease in pigs and sheep This double disaster caused a huge number of livestock to be destroyed to avoid the spread of disease; Beef, pork, and sheep meat from the UK are also banned from being imported into North America and Europe for a long time (16)

2 Industry

The UK was the world's first industrial nation Here, in the mid-18th century, the economy based on “old” agricultural production gave way for the first time to the development of factories Inventions such as the steam engine, spinning machine, locomotives and railways, improved methods of steel production marked the beginning of a modern industrial era

11 Up to now, due to many objective and subjective factors, the UK is no longer the leader but in general is still one of the top developed economies in the world Along with the US, Japan, Canada, Germany, France, Italy and Russia, the UK is one of the world's eight leading industrial nations (G8)

a Energy industry

Energy resources have been a crucial factor in making the UK a leading industrial nation The lush forests provide a substantial amount of wood for industries such as construction and shipbuilding, while beneath most of the green fields of the UK lies a significant resource coal, once considered "black gold." However, continuous –exploitation since the 17th century has led to the gradual depletion of this energy source

To some extent, oil has replaced coal in supporting the UK economy – a different natural fuel source discovered in the North Sea in the 1960s There are 240 offshore gas fields being exploited, primarily concentrated along the eastern coast of Scotland, near the Orkney Islands Important oil and gas ports include Sullom Voe in the Shetland Islands, Scapa Flow in the Orkney Islands, and Aberdeen on the mainland Although production is declining, the UK still holds the largest oil reserves in the EU

Following global trends, the UK government has been encouraging the development of renewable and environmentally friendly energy sources To date, the UK has been transitioning towards using more diverse energy sources, such as natural gas (providing nearly 40% of the country's electricity production) and nuclear power (accounting for almost 20% of electricity production) Nuclear power plants are located in coastal areas in the Northeast, along the southern coastline, East Anglia, and the Bristol Channel (17)

b Production and Manufacturing

In the 19th century, the United Kingdom was described as the world's workshop, the largest and sole source of heavy industrial and manufacturing products However, after wars, particularly World War II, the UK's economy suffered significant losses, and state-owned industrialization measures failed to curb the decline By 1979, the government of the "Iron Lady" Margaret Thatcher had to implement stringent policies to revive the economy, leading to a strong privatization drive Most state-owned enterprises in the industrial and service sectors were sold to private conglomerates The product landscape was also reshaped to adapt to the new circumstances (17)

c Other industries

Easy access to markets and ports, an attractive business environment, and a skilled workforce led to the explosion of the computer industry Software revenues currently account for around 3% of the GDP

The aerospace industry is one of the spearheads of the manufacturing sector and also a major export for the UK; in fact, the UK ranks second in the world in this field, just behind the United States

12 Today, some former industrial regions in the Northeast, Northwest, and Midlands benefit from foreign investment in expanding industrial zones Investors here enjoy favorable tax incentives and the opportunity to use the UK as a springboard into the European market (17)

3 Service a Overview

The UK's economy is primarily driven by the services sector, which encompasses retail, hospitality, professional services, business administration, and finance In 2021, the services industries made a substantial contribution of £1.7 trillion to the UK economy in terms of Gross Value Added (GVA), accounting for 80% of the total UK GVA GVA is a metric that measures economic output, similar to GDP, by evaluating the value of products and services produced while subtracting the production costs In contrast, manufacturing industries contributed £204 billion in GVA, representing 10% of the UK's overall total, while the construction sector's output reached £124 billion, constituting 6% of GVA

The chart below illustrates the comparative growth of services and manufacturing industries since 1990, when consistent data collection began (18)

Figure 6 UK economic output by industry, 1990-2021

13 b Classifying industries

Various forms of economic activities are categorized into industries, such as retail or construction These classifications are officially determined by an international system known as the Standard Industrial Classification (SIC) code How economic activities are grouped can significantly impact the apparent size of a particular industry The most recent SIC code, SIC 2007, was published in 2007 and aligns with internationally recognized standards utilized by both the United Nations and the European Union The Office for National Statistics (ONS) provides extensive information and guidance on the use of SIC 2007 This document presents data concerning the overall economic contributions of broad industrial groupings:

Agriculture (SIC Code A); Mining and quarrying (B); Manufacturing (C); Utilities (D, E); Construction (F); Retail and wholesale (G); Transportation and storage (H); Accommodation and food (I); Information and communication (J); Finance and insurance (K); Real estate (L);

Professional and Technical (M); Administration and support (N); Public sector and defense (O); Education (P);

Health and social care (Q);

Arts, entertainment and recreation (R); Other services (S) (18)

c Jobs by industry

The distribution of jobs across industries at the national level generally mirrors the economic output discussed earlier In March 2022, the service sector accounted for approximately 30.0 million jobs, encompassing about 84% of the UK workforce Manufacturing industries provided employment for 2.6 million individuals, constituting 7% of all jobs in the UK The construction sector employed 2.3 million people, making

14 up 6% of total employment It's important to note that the number of jobs does not equate to the number of individuals employed, as some people may hold multiple jobs (19)

Figure 7 Detailed breakdown of jobs across major industrial sectors as of March 2022

d Retail industry:

Retail is the leading service industry in the UK, comprising over 300,000 separate businesses and employing three million people, equivalent to 11% of the workforce The majority of the retail market is controlled by large retailers and supermarket chains, providing essential goods and services to meet customers' needs and desires However, there is a law that allows supermarkets to operate for a maximum of six hours on Sundays to help smaller stores compete In 2019, retail sales in the UK were valued at £439 billion For every pound spent, approximately:

39 pence was spent in food shops; 12 pence was spent in clothing shops; 9 pence was spent on automotive fuel;

8 pence was spent in household goods shops (including electronics and furniture stores);

The remainder was spent in various other types of shops and in non-store retail (20)

The retail industry is defined as businesses involved in selling new and used goods to the general public for personal or household consumption The retail sector includes physical stores, department stores, supermarkets, market stalls, door-to-door sales, and online retailers (21)

In UK retailing, especially in the grocery sector, private brand ranges play a significant role These private brands are not just used for pricing strategies; they are leveraged to build consumer trust and establish the retail company as an innovator and

15 guarantor of product quality Grocery retailers have become market leaders and have used their influence to expand product categories and implement a demand chain approach, often using their own brand names Approximately 39% of grocery sales in the UK come from private brand ranges, though this varies by product category

Strong central management control has allowed retailers to offer a clear, consistent, and high-performing retail experience, enabling them to adopt a marketing-oriented approach and realize the value of their brand names Retailers understand the role of innovation and product packaging in building brand trust and have taken a comprehensive view of retail branding by linking corporate, store, and product brands, aiming to become distinct brands themselves The importance of physical stores in projecting brand identity has also been recognized

Over the years, private brands have evolved from being low-quality, low-priced imitations in the late 1970s and early 1980s to high-quality, competitively priced, innovative alternatives Most grocery retailers now offer a range of private brand options tailored to specific customer needs

Figure 8 Segmented private brand range of leading grocery chains (22)

In recent years, during economic recessions, there has been a stronger focus on pricing, leading to increased popularity of retail brand options, especially in the food sector Even high-end retailers like Waitrose have introduced Essentials retailer brands, and Tesco has launched discount brands to compete effectively with Aldi and Lidl

The UK's retail landscape is primarily shaped by supermarkets The four largest retailers in the UK are Tesco, Sainsbury's, Walmart (Asda), and Morrisons, meaning that supermarkets dominate the industry Notably, Amazon has entered the top five (after supermarkets), now accounting for £4 of every £100 spent in the UK (23)

e Other industries:

Insurance, communications, market research, event organization, management consulting, healthcare systems, and pharmaceuticals are also developing fields The National Health Service (NHS), the primary healthcare service provider in the UK,

16 boasts the third-largest workforce globally, with 1.5 million personnel and an operating budget that can reach up to $74 billion annually

Tourism is a significant revenue generator for the United Kingdom, attracting approximately 25 million visitors each year From historical landmarks, cultural traditions, and natural landscapes to the vibrant modern lifestyle, all contribute to attracting tourists

III Evaluate company in the industries and choosing the potential partners 1 Assess industry companies and choose possible partners

One of the prosperous and significant contributors to the UK economy is the retail industry In the UK retail sector, brands are still doing well Even more noticeable is the fact that major players in the retail sector like Tesco, Sainsbury's, Asda and Morrisons dominate the UK retail landscape

1.1 Tesco

Tesco is a global retail firm with operations in many different nations The business was established by Jack Cohen in 1919 as a little food stand in East London Since that time, the business has expanded tremendously, adding new services and product lines while solidifying its position as one of the biggest merchants on the planet

The current headquarters of Tesco are located in Welwyn Garden City, Hertfordshire, England It operates in 12 nations and employs over 300,000 people, including those in the UK, Ireland, Hungary, Czech Republic, Poland, Slovakia, Malaysia, Thailand, and China (24)

1.1.1 Tesco's offerings in terms of goods and services

Tesco is a well-known grocery business that sells a variety of goods, such as food, apparel, gadgets, and housewares It has expanded into other industries, including financial services, mobile technology, and insurance The company's motto, "Every little helps," highlights its commitment to giving clients high-quality goods and services at reasonable costs Tesco is currently the second-largest retailer in terms of earnings and the third-largest retailer in terms of revenue on the global market One of the most valuable firms in the UK, it has a market valuation of over £20 billion (24)

17

Picture 1 Tesco offers a variety of grocery products at the supermarket

Picture 2 Tesco's e-commerce website

18

Picture 3 Tesco offers a financial services website

1.1.2 Tesco group revenue in the United Kingdom (UK) 2015-2023

Tesco generated more than 60 billion British pounds in revenue in the United Kingdom and the Republic of Ireland during the fiscal year 2022 2023 This was an –increase from the previous financial year of more than three billion pounds In 2022–2023, the company's profit in the UK and the ROI rose and reached $1,249 million (25)

Figure 9 Tesco group revenue in the United Kingdom (UK) 2015-2023

1.1.3 Tesco's SWOT Analysis a. Tesco’s Strengths Broad range of products

19 One of Tesco's primary advantages is the breadth of its product selection It serves a wide range of customers and offers everything they need at one location, including food, household goods, electronics, and clothing Customers can find new items and try new things thanks to Tesco's extensive product selection, which also fulfills their demands Customers are drawn to Tesco because of the variety, which includes everything from everyday necessities to high-end goods Additionally, Tesco is able to keep a competitive edge over its business rivals thanks to its wide product selection

A productive supply chain

Tesco's effective approach for managing its supply chain guarantees that customers receive their orders as soon as possible, cutting down on wait times and raising customer satisfaction Customers will receive their goods immediately and without difficulty thanks to its design, which aims to maximize productivity and minimize costs This effectiveness contributes to waste reduction and better inventory control, both of which increase business profitability Additionally, it guarantees that the business can react swiftly to changes in customer demand and market trends

A powerful brand image

Tesco has established a solid brand reputation throughout the years for offering affordable, high-quality goods As a result, Tesco has gained a following of devoted customers and developed a solid reputation The company's dedication to sustainability and social responsibility, which is in line with the ideals of many customers, further strengthens the brand image of the company

Client loyalty program

Tesco's Clubcard loyalty program delivers special rewards to its customers, which promotes loyalty and repeat business Tesco can use this program to gather information on client preferences and behavior, which aids the corporation in customizing its products and marketing plans

b Tesco’s Weaknesses

Dependence too much on the UK market

Tesco's over reliance on the UK market restricts its ability to grow and penetrate new areas and leaves it open to shifts in consumer preferences and purchasing patterns.Tesco's profitability may be further impacted by the shift toward internet purchasing, which has raised competition and challenged conventional retail structures Tesco needs to expand its product line, look into development potential in emerging areas, and spend money on digital capabilities to improve its online presence in order to overcome this deficit

Cost-cutting measures' negative impacts

20 Reduced staffing levels and subpar customer service are only two consequences of the company's cost-cutting tactics; employee morale and job satisfaction have also suffered Low staff engagement and high employee churn may result in increased training expenses and decreased productivity, which may further affect service quality and client satisfaction Tesco should make an effort to empower and collaborate with its staff members, provide competitive pay and benefits, and engage in their training and development to address this issue

Failures in overseas market initiatives

Cultural differences, logistical difficulties, and regulatory barriers have hampered the company's expansion into other markets, leading to large losses and failed endeavors Tesco should take a more regionalized approach to flourish in international markets, which includes adjusting its product offers to local tastes and preferences, working with regional suppliers and companies, and interacting with regional stakeholders and communities Before entering new markets, it should also perform extensive market research, perform due diligence, and establish strong ties with regional authorities and regulators

c Tesco’s Opportunities

Delivery of groceries online

Tesco could broaden its online grocery delivery service in order to reach more customers and boost sales as the trend toward online shopping continues The user experience on their website and mobile app can be enhanced, delivery capacity can be increased, more flexible delivery and product options can be offered, and easier delivery and pickup alternatives can be offered

Integration of technology

Tesco may be able to increase efficiency and customer loyalty by using technology to streamline its supply chain, improve inventory control, and customize the customer experience To expedite procedures and personalize customer interactions, this includes investment in artificial intelligence, data analytics, and automation To offer a distinctive shopping experience, Tesco can also experiment with novel store designs like cashier-less checkout and augmented reality displays Tesco can stay ahead of the competition and expand by embracing innovation and technology

Worldwide expansion

Tesco may look into entering additional foreign countries in order to potentially reach new consumers and boost income The business has already grown into a number of nations with success, including Thailand and Hungary However, there are still a lot more areas to take into account, including developed markets in Europe and North America as well as Asia, Africa, and South America Tesco can increase its clientele, diversify its sources of income, and reduce risk by entering new markets

21 Collaborations and partnerships

Tesco can look into potential joint ventures and collaborations with other businesses in the technology or retail industries For instance, the business might collaborate with a technology firm to produce improvements for the retail industry or with a supplier to develop new product lines Through these collaborations, Tesco can continue to innovate and compete in the market

d Tesco Threats ’s

Economic turbulence

Recessions and other economic downturns can result in lower customer spending, which could harm Tesco's financial results Additionally, the corporation can incur higher expenditures as a result of inflation and supply chain disruptions Tesco can find it more challenging to obtain finance during economic downturns for investments in new technologies or for business expansion

Internet security risks

Tesco is susceptible to cyberattacks because of its significant internet presence, which might jeopardize critical consumer data and harm the company's reputation Tesco's financial results could be impacted by the expense of investing in cybersecurity safeguards However, failing to address the cybersecurity vulnerabilities could result in legal or regulatory fines, which would have additional financial ramifications

Adapting consumer tastes

Consumer preferences are always changing, and Tesco risked losing market share to rivals if it couldn't adapt to the new trends For instance, Tesco may need to modify its product offerings if consumers start to choose organic or plant-based goods in order to stay competitive Tesco's brand reputation could suffer if it doesn't adapt to shifting consumer tastes, which could have long-term effects (26)

1.2 Sainsbury's

Leading US and UK food retailer J Sainsbury plc also has holdings in real estate and financial services The group includes Shaw's Supermarkets in the US and Sainsbury's Supermarkets and Sainsbury's Bank in the UK Britain's oldest major food retailing company, Sainsbury's Supermarkets, was founded in 1869 by John James and Mary Ann Sainsbury Sainsbury's is headquartered in London, Greater London, the UK (27) There are 1,414 Sainsbury's stores in the United Kingdom as of August 15, 2023 The country with the most number of Sainsbury's locations in the UK is England, with 1,276 stores, which is about 90% of all Sainsbury's stores in the UK (28)

J Sainsbury Plc (Sainsbury's) is a multi-channel retailer that offers groceries, general merchandise, and clothing products The company operates retail outlets of various formats, including supermarkets and convenience stores, under Sainsbury’s, Habitat, and Argos banners It also retails products through online channels Sainsbury's

22 stores offer fruits and vegetables, meat and fish, dairy, eggs, juice, pet food, baby and toddler products, beer, spirits and wine, and chilled and frozen food, among others Sainsbury's also provides various financial services, including travel money, insurance, credit cards, and loans It is also involved in property development and real estate business The company primarily operates in the UK and Ireland

Picture 4 Diverse goods at Sainsbury's supermarket

Picture 5 Sainsbury's e-commerce website

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Picture 6 Sainsbury's provides financial services

1.2.1 Sainsbury's SWOT Analysis a Sainsbury's Strengths Numerous Operations

Profit is the primary goal of a company, and brands are aware that growing their operations will boost profits Every firm aspires to grow its operations Not many companies, however, are successful in growing their businesses like Sainsbury's did 153 years ago, Sainsbury's was first created From that point on, it began steadily and cautiously increasing its business Sainsbury's has now opened more than 600 supermarkets and 800 convenience stores by working hard day and night.Customers find this accessibility appealing, which expands the number of people who use the brand

Provides Every Segment Products

Sainsbury’s, a retail store provides value products for the economy segment and branded and expensive products as well as special products for the upper-class segment.

Effective Marketing

Any brand, no matter how amazing, will always be underappreciated if it is not properly marketed Companies invest millions of dollars in marketing because they understand that having an effective plan is just as important as producing high-quality products Sainsbury's places a high priority on marketing because it recognizes the value of effective marketing approaches Sainsbury's is one of the major supporters of the Paralympics, for instance Ellie Simmonds, David Beckham, and Jamie Oliver are just a few of the celebrities and influencers who have been brought on as Sainsbury's ambassadors

b Sainsbury’s Weaknesses

Absence of Global Expansion

Once they have a strong following in their own country, brands that intend to rule the market search for strategies to grow outside Sainsbury's didn't want to develop its

24 business abroad despite having more than 14,00 branches in the UK Investigating foreign markets would have raised sales and expanded Sainsbury's market share abroad.

High Operational Costs

To earn the highest profits, businesses are constantly striving to reduce their operating costs Costs will be higher for a company with a high cost of operations Less profit will be made as a result Given how dispersed Sainsbury's operations are, a sizable sum of money is needed to keep the company afloat Sainsbury's has seen a decline in profit margins as a result of its high operating expenditures

c Sainsbury’s Opportunities

Worldwide Markets

Sainsbury's can expand its activities overseas now that it has opened an outlet and reached a sizable portion of the UK Sainsbury's would be welcomed in a lot of both developed and developing nations Sainsbury's will be able to boost its income and achieve notoriety on a global scale by entering the overseas market

Economic Shift

There’s an economic uplift and customer prevalence within the company More and more audiences have shifted their preferences to Sainsbury's servicing Sainsbury’s also converted their 5 to 6 focus DIY stores into convenient supermarkets

d Sainsbury's Threats Increasing World Inflation

A growing wave of inflation has been noticed since COVID-19 made landfall The prices began to rise as the economies got moving Additionally, inflation soared significantly earlier this year after Russia invaded Ukraine Sainsbury's may be in danger from rising inflation since people's purchasing power declines as inflation rises As a result, fewer people will visit Sainsbury's Sainsbury's will see a decrease in revenue as a result

Globalization

The globe has become a global village because of technological advancement As a result, a lot of enterprises and organizations increased their market and developed into international, multinational brands Such growth of rival brands could be seen as a threat to Sainsbury's

As an illustration, a new company may enter the market and attract Sainsbury's customers Due to the potential for substantial consumer loss, there may be financial consequences (29)

25 1.3 Asda (Walmart)

In 1965, the British grocery business Asda was established by a group of farmers from Yorkshire in northern Britain With a 16.9% market share, it holds the second-largest supermarket chain in the UK

The business's main office is in Leeds, West Yorkshire Since 1999, the American retail behemoth Walmart has controlled Asda With more than 11,000 locations in 27 countries, Walmart is the biggest retailer in the world

In the UK, Asda operates around 600 stores, the majority of which are in England A few of the company's stores are also located in Wales, Scotland, and Northern Ireland The vast majority of Asda locations are found in outlying shopping centers The business is presently opening more locations on high streets and in city centers Asda is renowned for its low prices and extensive product selection The biggest online retailer of food in the UK is Asda The business operates a vast delivery network with more than 1,000 vans For six years running, Asda has been named the greatest grocery store in the UK for customer satisfaction

1.3.1 Asda's offerings in terms of goods and services

The business also sells electronics, home goods, food, and other goods ASDA also provides a range of financial services, sold both in the supermarkets and online all over the UK

Picture 7 Goods at ASDA supermarket

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Picture 8 ASDA's e-commerce website

Picture 9 ASDA offers a financial services website

1.3.2 Current state of the Asda company's business

Supermarket chain Asda has reported that its like-for-like sales for the second quarter (Q2) of fiscal Year (FY) 2023 have increased by 9.6% against the same period in FY22 The Q2 figure was also up 1.8% compared with the Q1 of FY23 During the Q2 period from 1 April to 30 June 2023, Asda’s own brand sales increased by 14.7%, driven by the company’s investment to offer value to customers The company’s value range, Just Essentials, which launched in May last year, reported sales growth of 87% in Q2 FY23 against the prior year’s quarter Like-for-like sales for the retailer’s Clothing and General Merchandise (GM) divisions also rose by 2.8% and 6.3% in Q2 compared with the same period in FY22 The retailer’s online grocery recorded an average of