Journal of Economic Geography 13 (2013) pp. 327–356
doi:10.1093/jeg/lbs057
‘We’ve learnt how to be local’: the deepening
territorial embeddedness of Samsung–Tesco
in South Korea
Neil M. Coe*,y and Yong-Sook Lee**
Abstract
This article seeks to contribute to the growing economic-geographical literature on
the globalization of retailing by offering a longitudinal analysis of the operations
of Samsung–Tesco in South Korea. More specifically, it endeavours to explain how
Samsung–Tesco has rapidly become one of South Korea’s most successful retailers
since Tesco’s market entry in 1999. The analysis mobilizes the notions of territorial
embeddedness and strategic localization to unpack how Samsung–Tesco has secured
sustained growth through progressively deepening its connections with the host
economy and society in different ways. In broader theoretical terms, the study provides
rich illustration of transnational corporation post-entry dynamics in host retail markets,
demonstrating that strategic localization is not a static phenomenon, but a dynamic set
of processes that evolve through time and in relation to the changing competitive
conditions in the host market concerned.
Keywords: Retailing, globalization, South Korea, Samsung–Tesco, territorial embeddedness,
strategic localization
JEL classifications: G34, L22, L81
Date submitted: 3 July 2012 Date accepted: 19 November 2012
‘We’ve learnt how to be ‘‘local’’; in South Korea, our largest international business, we have
over 22,000 employees and just six UK expats’ (Tesco 2010 Annual Report).
1. Introduction
In October 2005, the giant UK-based grocery and general merchandize retailer Tesco
launched a new format of store in Denton, Greater Manchester. Called Tesco
Homeplus, the 4700-m2 store was largely dedicated to non-food items, selling a wide
range of health and beauty, clothing and jewellery, electrical, entertainment and leisure,
and home improvement goods over two floors,...