Issues For Tesco: Entering The Indian Market

Introduction

For many years the world market is becoming more global, nonetheless they remain significant cultural distinctions between countries and marketplaces. Cultural principles and social behaviour of an consumer influence their buying decisions made in the market (Banerjee, 2008). Furthermore one of the important factors affecting consumer behavior is culture (Gong, 2009). Hofstede detailed "culture" as a collective mental programming, a kind of behaviour one nationwide stocks with the other members of the same nation rather than with those outside the land (Alexander, 1997 p. 235). In other words it is a way of acting, connecting and trading with same nationality associates.

This research talks about how Tesco would have to address this culture of Indian customers if it searched for to get into the Indian market. This research would make a difference because a leading researcher has noted the particular one of the main element difficulties for a european supermarket endeavoring to type in the Indian market is to understand the mind set of an Indian consumer. India's society is over one billion, with different religions, vocabulary, dialect, food habit, buying behavior etc. which evidently gives a picture of its complicated market Halepete (2008). Therefore if UK giant Tesco packages to go into the Indian market it needs to understand the Indian consumer's culture (BBC media, 2008).

Literature Review

Tauber (1972) argued that consumer behaviour is an assortment of three activities: shopping, buying, and eating (Ahmed et al 2007). Consumer behaviours also vary from country to country because of the different social, inexpensive, educational etc. environment. It has also been pointed out that different consumer behaviour reacts in a different way towards services and services. Cultural influences are essential from an organisation's view as it requires to shape its structure and the thinking of their marketers according to the culture. Wright et al (2001) claim that marketers need to appreciate that tension between deep rooted local culture and new selections from other countries is actually possible in the changing world.

The Indian market has lots of of opportunities for retail industry. The unorganised retail composition of India includes street outlets, pavement shops, every week markets, 'Kirana' stores (mom and pop stores), and a public distribution system (Srivastava, 2008). They can be well aware of the likes and dislikes and the needs of the local consumers. They do not use any modern solutions, nonetheless they do add-on services like free home delivery and monthly paying systems.

The expansion of a merchant depends on various factors. Management on its own cannot make any shop successful; it is vital to understand the buyer and just how they act and make decisions in relation to various retail products and services. The study of consumers includes some of the next (Gilbert, 2003 p. 46)

Customers' buying motive

Location and market segment

Types of promotion and offers and their influence on consumers' shopping patterns

Any organisation growing in foreign markets and seeking to root itself highly in foreign land needs to get a good grasp of the country- specific culture and primary values (Banerjee, 2008). Thus, if any traditional western retailer desires to broaden in India it has to see things in line with the Indian consumer's point of view.

India is a country with a variety of interacting, interrelated and interdependent civilizations rendering it complicated for marketers to find a common view. But still India is one of the very most attractive countries for global merchants. Where there are definitely more underdeveloped retail constructions, there rest opportunities for retail enlargement by organised sellers, including probably by traditional western businesses. In addition, India's economy is growing and with the surge in middle class buying electricity consumer needs are also changing gives further scope to develop the retail industry.

The food and grocery store sector in India was a slow-moving starter regarding to Images F&R Research (2007). It had been as low as 0. 8 per cent annually but with the work of the big Indian business groupings like Reliance Group, Future Group, RPG Group (Spencer's Retail), Aditya Birla Group, ITC Ltd, Godrej supermarket and with the Bharti-Wal-Mart Private Small cash-and-carry store, impressive growth in the industry is expected (Sengupta, 2008).

Evans et al 2008 lists a number of factors that need to be taken in to bank account by retailers when joining a foreign; items quality, range and fashion, level of services, facilities, layout, atmosphere, location, quality of display, advertising, standard reputation, consistency, price and image. Specifically with regards to India Halepete (2008), suggests that Indian middle income customer is a value-conscious shopper who is very hard to please- a person who wants "a world course product at Indian prices".

Further tests by Sengupta (2008), for example, highlight some Indian consumers' traditional buying patterns, which evidently show they are not accustomed to buying food and grocery store items or milk products in stuffed form. They buy grain from local stores that they process into flour at the local flour mill; fresh dairy is sent everyday at doorsteps early morning by the milk man; meats and fish are usually bought from wet marketplaces or speciality stores. Eggs and bakery products are bought usually from stand-alone retailers or bakeries. In every these respects as well as others, India is completely different from a traditional western country such as Britain.

Research Questions

How would Tesco, a traditional western supermarket, place itself in the various and varied culture of India?

What products would Tesco have for consumers who are not accustomed to pre-packed food and food products?

What strategies should Tesco use for the many Indian consumers who are vegetarian and who do not drink alcohol?

Research Method

A questionnaire review method would be utilized because of this research. A survey strategy is commonly found in business and management research because it right answers questions like who, what, where, how much and how many (Saunders et al 2007 p. 138). Cooper and Schindler suggest that study methods allow experts to measure a sample of respondents' attitudes, opinions, intentions etc. which after collecting can be combined to represent the whole populace (Ahmed et al 2007).

The main benefits of the study method in this specific case are

Allows collecting data from a huge sample size, given the diversity within India (e. g. religion, income) it might be important to have a relatively large test size.

A questionnaire study can get views from a relatively large sample in a fairly easy and cost-effective way by asking straightforward close questions.

Data collected can be easily standardised and can be used for contrast - this will allow comparability of results from Indian buyers with survey evidence of Tesco's UK shoppers.

The survey method is easy to describe and understand as the questions would maintain a logical order and concise instructions would be given (e. g. in the event respondents need to skip some questions).

The main limits of the review method and how they can be minimized are

People talk more easily than they write this one of the restrictions of a study method but it could be minimised by associates of the research team writing for the respondents as they talk. In addition it would also overcome the problem of misunderstanding the questions by the respondents.

Secondly the respondent are uncertain about the info, this may also be minimised by explaining them as for what purpose the info is been accumulated. And once the info is been collected for what goal it will be used as questionnaire survey would be face to face, so can describe Tesco's plan to enter into the Indian market.

To minimize the quality and the development of the questionnaire it will be piloted and analyzed before it is manufactured fair for the respondents, which will allow us to prepare the questionnaire because of an Indian consumer. Furthermore it will allow us to eliminate questions that will be sensitive for them.

Generally long questionnaire receive low response rate so keeping this at heart questionnaire prepared will be short in length. Additionally to hold the interest of the respondents it'll be made interesting by providing variety in the sort of questions used.

Alternative method Rejected:

Interview is generally between two people where the first is the interviewer who is seeking responses from an interviewee the other person for a particular purpose. From a study point interview is obtaining and recording reactions of the interviewee on issues relevant to general aims and specific questions of a study task (Gillham, 2000 p. 2).

Some of the reason why of eradicating interview as the research method are

Sample size is typically smaller, which is extremely hard for this research as the results must be generalizing for the whole country India and therefore the sample size needs to be larger.

Interview creates a formal atmosphere, where both the interviewer and interviewee know that it's not a dialogue but a tactical process which can not interest the respondents. Because of this particular research it is quite essential to collect actual views of Indian consumers so have to keep their curiosity about the study.

Fixing a date and time suitable for both the functions could devote some time hence it is time consuming. In addition maybe it's expensive if the sample size is larger to arrange for a particular place to request all the respondents. And like discussed before sample size in this research is large.

Data gathered is more technical in dynamics, which wouldn't normally be easy to analyse if the test size is bigger.

Detail description of Research method

5. 1. Sampling

The people is a set of individuals, items or data from which a statistical sample is taken. The population compromises of individuals, households, companies or other company. And sampling methods are categorised as profitability or non-probability examples. The probability sample includes random sampling, systematic sampling, and stratified sampling. In cases like this would be Indian consumers, from whom the info is necessary in a and unambiguous term (Gofton and Ness, 1997 p. 92). Only customers relevant to the study issue should be contained in the research rather than all the people. It is called as sample frame, a set of the target population.

India is a multi cultured and has big dissimilarities between various groups of people. There are big spaces between abundant and the indegent, the highly educated people and those who are illiterate, different living criteria, and different means of life. Keeping this in mind random sampling would be done to get a final sample of 250 respondents. Sample size also depends of factors like time, budget, and the amount of accuracy required. For this research every 2nd person walking out of the hypermarket will be picked.

5. 2. Making the Questionnaire

A questionnaire can be displayed as triangle or pyramid form with standard questions at the top, narrowing to specific questions in the bottom. In addition to gauge the validity and reliability of the factors it is essential to ask appropriate questions that will appropriately measure the trend of interest and that they are interpreted in the same way by respondents (Yang and Miller, 2007 p. 257). Based on Saunders et al (2007 p. 369) the questionnaire will maintain the next form

Introduction: It'll include the reason for the questionnaire. Dillman (2000) argues that to receive higher response rate, this should be outlined on the first webpage (Saunders et al 2007, p. 383). It will also include information like the subject of the study, and a reassurance about confidentiality.

It will be accompanied by awareness questions associated with the topic of questionnaire. E. g. Have they found out about supermarkets? have they heard about Tesco?

Followed by factual questions with one response or multiple choice e. g. Do they shop at supermarkets? How often they shop?

It is essential to keep continuity and natural stream. So then we ask questions reflecting the Indian consumers' knowledge e. g. Do they know what products can be purchased in a supermarket?

So far really is endless that respondents have not found the questionnaire difficult so we offer ranking questions regarding their like and dislikes e. g. What do they like in supermarket? A) Wide types B) Low prices C) Offers D) CUSTOMER SUPPORT E) Closest to residence.

The last selection includes relevant classification questions. In cases like this, they are like get older, gender, contest/ethnicity, education, income etc. Because data received through such questions can be divided in different groupings and can be utilized for contrast with any previous surveys and notice similarities and distinctions if any (Oppenheim 2001, p. 132).

The layout must also be checked out as it has to be easy-to-read and with sufficient space between lines and words.

Once the questionnaire is well prepared it needs to be pre-tested before it is finalised. Because this might give us an idea as the way the questions are understood by the Indian respondents and would it not get answers what the study is looking for.

Administration of the questionnaire

6. 1. Method Used

The questionnaire will be administrated via face-to-face interviews carried out by the researcher with Indian purchasers at Phoenix Mills in Mumbai. The researcher in this case will be noting down answers as the interview is in progress. Second, the interviewer will also be able to get rid of misunderstandings and answer respondents' questions (De Vaus 2002, p. 122). The questionnaire will be imprinted in Hindi (the nationwide vocabulary of India) and British.

6. 2. Location

India is a highly populated country and Mumbai is city where folks from different villages and other parts of India come to fulfil their dreams (BBC information, 2006), that could be the right place for the study. As discussed before, India is country of diversified culture and representative test could be found in Mumbai. As Mumbai is a big business hub and it creates plenty of job opportunities that people from various areas of the country apply and come to work. And may likely be a spot of a Tesco store.

In Mumbai it'll be conducted in Phoenix Mills, Lower Parel as it is one of the busiest shopping area with tons of shops for clothes and, music and it, also offers a 65000 square metres hypermarket one quarter of which is grocery store.

6. 3. Who will Interview the Respondent

Cultural differences will make it difficult to assemble reliable home elevators attitudes and behaviour. One factor could be translation differences (Gofton and Ness 1997, p. 151). So it is suggested which i work with a local research company as it could speed up the procedure by utilizing their readily available resources such as

Office location with available accessories and stationeries.

Projection room where team requesting the study questions to respondents will be briefed with slides and pictures of Tesco

Ready team members who would experience in doing such surveys

Secondly the agency can also help us formatting the questionnaire predicated on the respondent view and literacy and achieving our purpose.

In order to achieve our objective we would also be briefing the agency and the team who be interviewing the Indian consumers face-to-face. They would be kept up to date with information about Tesco and its own function and procedures.

6. 4. Data Analysis

Data collected will be got into on a get spread around sheet. Clear headings will be given to each row and column. Each question will be coded and displayed by a column on spreadsheet. Each questionnaire's answers will be filled in its respected rows. Answers to the primary questions will be analysed by classification data (e. g. to identify differences between the sexes). Techniques of quantitative research like charts, graphs and figures which is used that allows us to explore, summarize, and present connections between parameters and tendencies in the info.

Ethical Issues

As the study will be conducted in an international market extra health care needs to be studied of ethical issues. The next steps will be considered

Respondents will be reassured that all the information given by them will be secured under the Data Protection Function 1998 (and matching Indian regulations).

They also will be informed of the reason why information from them is being requested.

Personal data given by them will be stored safe and secure in the database.

The data will not be offered to any other parties.

Respondents are entitled to ask for a copy of the info they may have given. They will also be up to date that the data will be presented for 12 months and no much longer than that.

Limitations of the research

8. 1. Sample Size and Location:

India is one of the high filled countries on the planet with a diversified culture. Many Indian individuals are vegetarian and non-alcohol drinkers. So the location with the right representative test could be one of the restrictions of the study. In order to minimize the result of these constraints an area in Mumbai is picked to do the questionnaire survey. Mumbai as discussed earlier is a small business hub with people migrating from various areas of the united states. A country of 250 is not enough to create statistically significant data about (e. g. differences between age groups), but it is large enough to provide indicative results and also to act as sort of pilot study for a larger review by Tesco later.

8. 2. Complexity

India is also a country of several religions with different dialects and with different dialects. The questionnaire should be quick and simple which is understood by the Indian respondents. We also need to take into account the vocabulary and literacy barrier. Hiring a local research agency could help us triumph over these barriers. We're able to format the questionnaire by using the local research agency in the local words and in simple English which is recognized by the Indian respondent.

Conclusion

For any organisation to fulfil its stakeholders is primary objective. It thus becomes necessary to know very well what their requirements are. Furthermore when it is a foreign market the task is bigger as it requires cultural variations, different customer account, different government regulations, political pressures etc. And most importantly it requires a great deal of investment and time.

India's retail sector of India is fast growing and has a great deal of potential for foreign entrants such as Tesco. In order to tap the forex market Tesco must understand the Indian market as Tesco may well have to put into practice new strategies and also look at its product line and the changes had a need to suit the Indian market. The proposed research will be a very great way of identifying the main issues for Tesco in wanting to get into the Indian market.

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