Figure 2 above provides a snapshot of the financial performance of Tesco. In terms of ratio analysis, Figure 2 considers profitability, efficiency and liquidity. In terms of profitability, figures from the income statement are used, showing that profit margins at Tesco have been falling. Tesco has seen margins decline largely down to more intense price competition within the supermarket sector (Kantar Worldpanel, 2015). These apparent ‘price wars’ have been largely reported throughout the media, showing that supermarkets are trying harder to retain customers.