BM461 Global Business Environment

BM461 Global Business
Environment

EXECUTIVE SUMMARY
This study has evaluated that, there are various environmental factors which in turn
influences the functioning of the business. This study concludes that, change in the preference of
the customers and current market trends largely influence the functioning of the company.

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................2
REFERENCES................................................................................................................................3

INTRODUCTION
This study will highlight on various external environmental factors through PESTLE
analysis which in turn influence the working of the business. Tesco is one of the well known
multinational company which was founded in the year 1919 by Jack Cohen.
MAIN BODY
Global business environment is mainly concerned with how a particular business
interacts with uncontrollable national and international dynamic business environmental factors
on the company (Bentham, 2018).
Political factor: The impact of Brexit has largely influenced the prices of the food. This
in turn results in increase in the level of prices of food and devaluation of pound sterling. Brexit
may result in reduction in labour supply (PESTLE AND SWOT ANALYSIS OF TESCO 2016-17,
2019). This in turn influence Tesco to effectively seek towards expensive UK based suppliers for
core grocery items. The company must also comply with various governmental laws within the
countries in which it operates for smooth functioning of business.
Economic factor: UK tends to have high level of employment rate which in turn is very
beneficial for Tesco to imp-rove their supply chain and deliver the goods to the customers which
leads to higher productivity and profitability (Doh, Luthans, and Slocum, 2016). Falling
exchange rate of sterling pound results in higher operational cost for the business and in turn
affect the profitably.
Social factor: Change in the preference of the customers and current market trends
largely influence the functioning of the Tesco plc. Company tends to focus on delivering goods
online which helps in catering large customer base and improving the lifestyle of the customers
(Price and Moore, 2018). Change in the customer behaviour led to shut down of various stores of
Tesco which affects the productivity of business.
Technological factor: Adaption of improved technology helps in better operational
performance. Tesco integrate with online website in order to deliver goods to customers at their
door steps (Doh, Luthans, and Slocum, 2016). Tesco also avails facilities like club card
membership in order to avail effective services. Self checkout services is beneficial by
effectively providing ease and convenience to the customers.
Environment factor: Tesco tends to focus on complying with various environmental
laws and policies to function appropriately. It also focuses on reducing wastage by committing to
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reduce emission of carbon footprint (Hammad, 2015). Change in weather and climate changes
also influence the working of the Tesco plc.
Legal factor: Tesco plc. adhere with various legal laws, rule and legislations for smooth
functioning of the business (PESTLE Analysis for Tesco discusses its Business Environment,
2014). The company must comply with various employment laws, safety law, National minimum
wages law, etc. Tesco must also comply with food retailing commission for lawful conduct of
business.
CONCLUSION
This study concludes that, global business environment tends to have various factors
which in turn largely influence the functioning of the business. This study evaluates that,
company must take into consideration political, social, economic, technological, environmental
and legal factors for smooth functioning of the business.
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REFERENCES
Books and Journals
Bentham, J., 2018. Business and Economics in the News–Sainsbury's and Asda-the decade's
mega-merger. Teaching Business & Economics. 22(3). pp.11-12.
Doh, J.P., Luthans, F. and Slocum, J., 2016. The world of global business 1965–2015:
Perspectives on the 50th anniversary issue of the Journal of World Business: Introduction
to the special issue.
Hammad, A., 2015. Strategic Change and Its Management to Expand Business Through
Implementation of Models: A Case Study of Boots UK. Available at SSRN 2676800.
Price, A. and Moore, D., 2018. Management of Global Construction Projects.
Online
PESTLE Analysis for Tesco discusses its Business Environment. 2014. [ONLINE]. Available
through:<https://pestleanalysis.com/pestle-analysis-tesco/>
PESTLE AND SWOT ANALYSIS OF TESCO 2016-17. 2019. [ONLINE]. Available
through:<https://www.123writing.com/sample/pestle-and-swot-analysis-of-tesco-2016-17>
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