Abstract E-Commerce can be defined as the process of deploying digital information processing technology and electronic communications to establish, rename, and renovate valuable relationships between individuals and organisations. This goal can be achieved through electronic messaging, advertising, sharing of information, and the interchange of electronic documentation. As a leading retailer in the UK, Tesco has implemented e-commerce in its operational strategy as a means of enhancing its overall operational efficiency and also to meet the needs and expectations of the contemporary consumer. However, this implementation has been faced with challenges such as the management of delivery and packing costs, maintaining a desirable appeal and relevant assortment, product returns, the unpredictable nature of consumers, building and maintaining consumer loyalty, competition, channel conflict and finally privacy and security challenges. This study followed a mix of qualitative and quantitative approaches to determine the extent of these challenges. Two different sets of questionnaires amongst other forms of collecting secondary data were used. The results of this study revealed that varying business law across borders within target operation zones, concern with regards to data security and privacy and difficulty in implementing e-commerce to the current system as the main problems behind the implementation of e-commerce by Tesco from which a critical discussion was conducted on these results and conclusions and recommendations drawn. Methodology This study took a mixture of qualitative and quantitative approaches. As a result, the study utilized several approaches to gather the relevant data that was required to give out the required information with regards to the research aim and corresponding questions at hand. To answer these questions, the case study approach was applied. Thus, observations were conducted on various aspects of e-commerce with regards to their application in the business model of Tesco. To ensure that the data that was collected was effective and efficient, only constructs that were affected by the implementation of e-commerce were investigated in this study. These included aspects such as the management of picking and delivery costs, product returns, competition, consumer loyalty and so on. Thus, the impact of these variables of Tesco’s operations, sales and competitive advantage and consumer building, retention and satisfaction were monitored throughout the study period. Specific personnel were interviewed during this research exercise to ensure that the information that was collected was correct, efficient, and reliable for this study. The sample size was designed in a manner that ensured that all the variables that were affected by the application of e-commerce within Tesco were captured. As Dees (2008) asserted, such inclusion is essential since it enhanced the validity and reliability of the data that will be collected. In such an event, it will be easy to generalize the overall results to reflect the trends that are being experienced in the market. Thus, the case analysis approach was applied to determine the impact of applying e-commerce in the retail industry in the co