Positive and Negative Impacts of Macro Environment on Business Operations

Business and Business
environment

Contents
INTRODUCTION.......................................................................................................................................3
TASK 3.......................................................................................................................................................3
P4 Identify the positive and negative impacts the macro environment has upon business operations,
supported by specific examples...............................................................................................................3
TASK 4.......................................................................................................................................................5
P5 Conduct internal and external analysis of specific organisations in order to identify strengths and
weaknesses..............................................................................................................................................5
P6. Explain how strengths and weaknesses interrelate with external macro factors................................6
CONCLUSION...........................................................................................................................................7
REFERENCES............................................................................................................................................9

INTRODUCTION
The business gets affected by many factors these factors can be internal as well as
external. Internal factors are the factors which can be controlled by an organization, for example
employees, structure, values, mission, suppliers and etc. external factors are the factors which are
independent and are not in control of an organization. For reference purpose this report has taken
an example of a company, Tesco (Dahles and Susilowati, 2015). Tesco is a British company
which deals in groceries and general products. It is a multinational which has third largest chain
of retail market. This report discusses about the internal and external factors which affects the
operations and activities of a business.
TASK 3
P4 Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples.
The external factors and its impact can be analyzed through PESTEL analysis. The pestle
analysis of Tesco is as follows:
Political: The degree towards which the government can control the business includes in
this factor. This factor includes stability of government, potential changes to legislation, global
influences and so on. Any change into the regulation of government does affect the working and
operations of business. As in the case with Tesco, the company experience stability in it working
as the UK has stability in its government also. The UK country in 2011 had increase the rate of
VAT which put the negative effect upon the company as it has affected its revenue. In 2016, the
company also faced many issues due to Brexit as the business doesn’t know how to operate into
new business environment.
Economical: Economic factors depict the economic condition or situation of a particular
region or country. Economic growth, employment rates, inflation rates, monetary policy,
consumer confidence are some which includes in this factor. The economy of UK is very much
strong with a GDP of 7 % (Deasy and et. al., 2016). Also the employment rate of the country is
75% which is a good sign for a developed country. Higher economic growth signs the higher