Huarun Is Buying TESCO Tesco China Business UK Retail Giant Quit China

A few days ago, TESCO Tesco announced that it would sell the 20% stake in Huarun group to Gain Land, a joint venture Huarun set up, which means Huarun is fully offering TESCO Tesco's Chinese business.

A few years ago, Huarun signed a joint venture agreement between China Resources Enterprise Ltd and TESCO Tesco, which incorporated TESCO Tesco's China business. In 2014, it completed the establishment of a joint venture company, Huarun held 80% of the joint venture company, and TESCO Tesco held 20% of the joint venture company.

TESCO Tesco said the deal would bring about net cash income of about 275 million pounds, which will be used by general companies in the future. TESCO Tesco will focus on core business.

After the purchase of TESCO Tesco, Huarun's plan was to transform the 135 stores in TESCO Tesco's Chinese market into "Huarun 10000" to achieve brand expansion. This process is not smooth sailing. During the period, the adjustment of stores and personnel also led to staff disputes. The Huarun Department has also closed some of the Tesco stores, has done background integration, but are not ideal. The fundamental reason is that in the process of integration, the strong party will control the cost, reduce expenses through adjustment or layoffs, and even manage the high level of "exchange of blood", and the differences in corporate culture will become a major difficulty in integration.

A reporter once said: "TESCO Tesco once wanted to play a big role in the Chinese market, but there are several strategies which are not successful, such as testing small stores many years ago. In fact, the shop economy is promising, but the timing of TESCO Tesco is not right. At that time, it has not yet been launched to a large number of shops, but it should vigorously expand the large stores, so the shop of TESCO Tesco has opened one. After that, they stagnate. Subsequently, TESCO Tesco also made efforts in commercial real estate. Unfortunately, it was too expensive and complicated, so that it did not achieve the desired results. After a series of problems, coupled with the increasing cost and the common problems such as retail profits, TESCO Tesco made the idea of selling Chinese market very early.

From the point of view of the Huarun system, it has always advocated acquisition expansion, so it hit the nail on the head and acquired itself naturally into its own system, flop its own brand. For large retailers such as Tesco, TESCO, if they fail to perform the first few performance in an international regional market, they should withdraw to stop the loss.

Public information shows that TESCO Tesco has withdrawn from Japan and the US market and has sold its business in the Korean market. If TESCO Tesco completes the sale of Thailand and Malaysia businesses in the future, the future international market operation of the British retail giant will mainly be in Europe, including Czech, Hungary, Poland and Slovenia.