Global Financial Crisis and UK Retailing

Paper Summary:

This paper discusses the fact that although it is universally acknowledged that there is a global financial crisis, many companies have been limited in their reaction to current economic developments. The writer explains that the majority of efforts to deal with the impact of the crisis have been directed to stabilize finance and banking. The UK retail market has taken a major hit, and the writer shows how Tesco has reacted by offering better product deals and customer loyalty benefits. However, the company persisted in its expansion efforts, which may prove fiscally unfeasible as the crisis is likely to continue and affect all industries severely. The writer describes how marketers have had to rethink their marketing strategies and concludes that the challenge may be to develop market contractions as the crisis deepens.

Outline:
Background
Impact to UK Retailing
Case in Point: Tesco
Analysis
Conclusion

From the Paper:

" In the UK, one of the hardest hit has been retail market industry. Early speculations to the effect of the crisis to the UK retail industry intimated the high probability of price wars and shifting of market power to buyers who will be highly reluctant to spend for anything other than the most basic needs. It also raised concerns that the situation will further highlight issues raised against retailers, particularly industry leaders like Tesco, Asda and Marks & Spencer, regarding fair trade practices (Adams & Raisborough, 2008; Coe & Wrigley, 2007). As early as September 2008 when the Crisis was still being speculated on, many industry leaders sought to dispel the public concern to discourage speculation and depreciation of spending. However, reviews of 2008 performance have shown that many retail companies are reporting significant losses which are expected to continue in 2009."

Sample of Sources Used:

• Adams, M. and Raisborough, J. (2008). "What Can Sociology Say About Fair Trade?: Class, Reflexivity and Ethical Consumption". Sociology, Dec; 42: 1165 - 1182.
• Coe, N. M. and Wrigley, N (2007). "Host economy impacts of transnational retail: the research agenda". J. Econ. Geogr., Jul; 7: 341 - 371.
• Global financial crisis sinks teeth into retail (2008) [online]. The Wholesaler UK, 3 October 2008. Available at < http://www.thewholesaler.co.uk/html/global_financial_crisis_sinks_.html> [Accessed 6 January 2008]
• Jolly, D and Bennhold, K (2008). "European Leaders Agree to Inject Cash Into Banks", The New York Times [online]. Available at <http://www.nytimes.com/2008/10/13/business/13europe.html>. [Accessed 6 January 2008]
• Jones, G (2008). "Credit crunch? Financial crisis? Don't ell Tesco - they don't know we're in the money doo-doo" [online]. Marcom Professional , 1 October 2008. Available at <http://www.marcomprofessional.com/posts/graham.jones/credit-crunch-financial-crisis-dont-tell-tesco---they-dont-know-were-in-the-money-doo-doo> [Accessed 6 January 2008]

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