Business Environment of Tesco

This document discusses the business environment of Tesco, a leading international retailer. It explores the various environmental factors that influence the company and how it addresses them. The document also examines the impact of government regulations on the structure and operation of the business, as well as the effects of business environmental changes on the activities and organization of Tesco. The document includes a PESTLE analysis of Tesco, covering political, economic, social, technological, legal, and environmental factors.

GLOBAL BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
LO1..................................................................................................................................................1
Business environment of Tesco...................................................................................................1
LO2..................................................................................................................................................1
Impact of government on structure and operation of business. ..................................................1
LO3 .................................................................................................................................................1
Impact of business environmental changes on the activities and organisation of business.........1
REFERENCES................................................................................................................................3

LO1
Business environment of Tesco
Tesco is an international retailer leading the industry. Company is influenced by various
environmental factor that are required to be addressed by the company adequately. The company
is focusing over satisfying the tastes and preferences of customers. Company for meeting the
demands of consumers is producing organic and more healthier foods. The business environment
is also laying stress over compliance with the CSR practices by the company. This is the key
concern of company along with meeting demands of customers. An organisation for competing
in the market is required to consider the business environment affecting the organisations in the
most beneficial manner.
LO2
Impact of government on structure and operation of business.
Company is operating worldwide and therefore is influenced by global political factors. It
is required to consider the factors as there are different political platforms. The company is
required to follow the rules and regulations laid by the government of company in which it is
operating. Organisations are required to structure their business that complies with the
government regulations (Morrison, 2016). Such as minimum wages, working hours, CSR
practices and such other factors. The taxation policy of the government may require the company
to record and perform its business activities as per the government requirements. Companies is
facing issues related to the tariff rates of different companies charging affecting the trades of
business.
LO3
Impact of business environmental changes on the activities and organisation of business.
The environmental changes refer to the economic, social, technological factors and other
external factors.
PESTLE analysis of Tesco is enumerated below:
Political factors
By doing assessment, it has identified that Tesco is operating in 12 countries which in
turn has direct impact on its strategic framework. Moreover, business unit has accountability to
comply with tax rates, laws and legislation associated with concerned country. Along with this,
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aspects pertaining to stability and instability in relation to the specific country also having impact
on firm’s operations.
Economic factors
It refers to the factors such as inflations and other factors directly influencing the
consumer behaviour. It has impact over the activities as it guides the goods to be produced and
the manner in which they are to be produced. The economic factors are considered to be taken on
global scale. The inflations directly impact the purchasing power of the consumers affecting the
demand and pricing strategy of company (Jonah, 2018). Economic factors also include the
economic condition of the country in which it is operating, a strong economy will help the
company in growth and success.
Social factors
It refers to the blend of societal components including lifestyle, culture and the social
class and such factors. This has great influence over the business operations as goods and
services are ultimately delivered to the society. There is great focus of society towards adoption
of the CSR practices. Tesco has implemented the CSR practices in its operations for establishing
effective relationship with the stakeholders of company.
Technological Factors
In this dynamic business environment company cannot operate successfully without
adopting to the technological advancements. It helps company in increasing its efficiency and
productivity. Technology includes applying software for management of operations, digital
technology that is making the products available to the end customers through number of
delivery channels (Hamilton and Webster, 2018). Organisations structure their operations and
enterprise as per the technological advancements for achieving its desired goals and success.
Legal factors
For performing effectually and maintaining brand image Tesco has to comply with all the
legislation pertaining to anti-trust, discrimination, consumer & data protection, health & safety,
food, copyright, patent etc. By following such rules and regulations company can carry out
operations effectually.
Environmental factors
In the current times, organizations, operating in retail sector, are facing pressure from
government’s side in relation to addressing environmental issues or aspects. Thus, for attracting
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customers and building distinct image at marketplace Tesco is placing more emphasis on
undertaking fuel saving routes. Thus, for attaining success firm is required to perform business
activities in an eco-friendly manner and make more focus on recycling.
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REFERENCES
Books and Journals
Jonah, U.I., 2018. The Influence of Transaction Costs on the Business Performances of Tesco
Supermarket. International Journal of Business and Social Science. 9(5).
Morrison, M.J., 2016. The Global Business Environment: Challenges and Responsibilities.
Palgrave Macmillan.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
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