The Effects of Environment on Business

The Effects of
Environment on
Business

Table of Contents
Introduction...................................................................................................................3
History...........................................................................................................................3
Task 1...........................................................................................................................4
Pestle Analysis..........................................................................................................4
Culture.......................................................................................................................5
Corporate social responsibility..................................................................................6
Competitors...............................................................................................................6
Task 2...........................................................................................................................7
SWOT Analysis.........................................................................................................7
5 Cs analysis.............................................................................................................8
Porters Five forces..................................................................................................10
Task 3.........................................................................................................................11
Market structure......................................................................................................11
Influence of demand...............................................................................................11
Influence on supply.................................................................................................12
Conclusion..................................................................................................................14
References.................................................................................................................15
Introduction

The following report consists of an analysis on Tesco. There are a number of
factors which have been influencing a business environment such as macro and
micro environmental factors (Prajogo and Oke, 2016). The following report consists
of different frameworks which are assessing macro as well as micro environment of
business. Assessment of various changes that are brought in market for Tesco along
with an assessment of their competitors is also provided in the report. There are
framework like Pestle analysis, Swot analysis, 5 c’s and Porter’s five forces models
used.
History
Tesco was founded by Jack Cohen in 1919. It was started as a group of
market stalls in London. The name Tesco’s first appeared in 1924 after a shipment of
tea was purchased by Cohen. The business expanded rapidly and by 1939 there
were already hundred Tesco stores throughout the country. In early 1990s Tesco
started expanding globally with operations in a number of other countries throughout
the world.Tesco have now successfully diversified into a number of areas of retailing
such as books, clothing, furniture, toys, software, financial services and a number of
different internet services (Amponsah, 2018). Tesco have also repositioned
themselves as high volume and low-cost retailer in order to attract a range of
different social groups with low-cost value.
Task 1
Pestle Analysis
There are a number of external factors that are affecting operations and
activities in Tesco. Below mentioned are these external factors:

Political factors: Company is effectively carrying on their business in a
number of different countries and due to this they have been affected by political
situation in different countries. When taking the home market into consideration
Brexit has created a lot of uncertainty for Tesco. Tesco however is capable of
responding to current as well as future legislation and adjusting their business
policies as per these legislations.
Economic factors: There are a number of different economic factors such as
fiscal policy, monitory policy, supply-side policy, economic growth and so on which
are affecting Tesco. The company is severely affected due to the pandemic of
COVID-19 and a number of earnings are going down (Bedianashvili, 2016). This is
because the people are losing their job. This has affected Tesco from high labour
cost particularly in countries like United Kingdom and Ireland.
Social factors: There are a number of initiatives taken by company in
response to different social changes and demands of consumers. There is high
demand of halal meat to the Muslims so company have opened some of the
independent meat stores in United Kingdom. They have also started their own label
halal meat in Malaysia and Thailand. Company have also taken into consideration
the demand for vegan and vegetarian food in European markets.
Technological factors: there are a number of benefits brought in Tesco
through technological advancement over different years throughout. Such as club
card which was organised by Tesco in 1995. The loyalty card has been a big force
which has led the company towards success. There are a number of users of Tesco
in United Kingdom and a number of different countries were taking this card into use.
There are also different factors such as Tesco self-service checkout points which
have provided convenience to customers and also helped in reducing cost of