Diversification strategy : Tesco opts for own-label banking
Recommend on Google+
An excellent article in The Guardian today would provide lots of scope for a good business strategy lesson for the Year 13s…
Tesco is launching its own bank, and it has just opened a customer service centre in the North-East (the heartland of Northern Rock). However, the Board of Tesco Banking has ruled out making an acquisition of Northern Rock, which the UK government has just been given permission to breka up and sell by the EU.
Instead, Tesco is focusing on an organic growth strategy for its fledgling banking division - and who would bet against them making a success of the venture given their dominance of other retail segments in the UK?
The article is here. Lots of useful points in there for students, and scope for discussion. For example:
- Organic v acquisition
- Advantages and disdvantages of buying an existing bank in order to enter a market
- The value of location (Tesco’s existing portfolio of stores) v buying an “outdated bank branch network”
- The strategic rationale of Tesco diversifying into personal banking
- Gaps in the market for banking services that Tesco is hoping to exploit
blog comments powered by Disqus
BUSINESS TEACHER RESOURCE NEWSLETTER
Get first news of business teaching resources, ideas and other materials from tutor2u. Over 9,400 business teachers from the UK and around the world receive our regular teacher email newsletters. Sign up for free here!
Popular Topic Tags
recession, demand, prices, price, unemployment, profit, economics, costs, investment, inflation, supply, employment, trade, competition, gdp, risk, china, debt, euro, entrepreneur, capacity, production, downturn, innovation, tutor2u, revision, pay, exports, manufacturing, confidence, profits, food, incentives, banks, strategy, globalisation, aqa, expectations, oil, csr, usa, startup, retailers, housing, productivity, sterling, supermarkets, google, economies of scale, mortgage, takeover, cash flow, advertising, quiz, leadership, property, buss4, tesco, economic growth, video, efficiency, enterprise, motivation, stakeholders, apple, deflation, corporate social responsibility, ebea, market share, airlines, pricing, taxation, slowdown, bank of england, acquisition, merger, market failure, borrowing, competitiveness, sustainability, product life cycle, interest rates, credit crunch, budget deficit, aqa business studies, facebook, twitter, aqa business, bbc, nelson thornes, philip allan updates, starbucks, philip allan, monopoly, diversification, recruitment, organic growth, stocks, training, oligopoly, starter activity, shareholders, uk economy, poverty, emerging markets, dollar, government failure, retailing, management, suppliers, buss1, marketing mix, tim harford, cpi, branding, opportunity cost, breakeven, government spending, hodder education, vat, product, customer service, eu, losses, wages, evaluation, india, external growth, wealth, environment, edexcel, location, promotion, technology, information failure, business studies revision, sources of finance, franchise, aqa gce business, elasticity, regulation, spare capacity, welfare, jobs, economic cycle, marketing, zondle, strategic direction, british airways,View all tags for the Business Blog




