Impact of Internal and External Factors on Tesco

BMP3002

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Effect of external and internal factors on Tesco..........................................................................3
Describing ways in which Tesco can impact the external environment......................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Internal environment is termed as the set of forces that affects the working of the
organization internally. External environment are the factors that externally affect the
profitability and functionality of the business. The report will be based on the internal and
external environment of Tesco. Tesco is a leading supermarket chain in the united kingdom.
Also, the impact of the organization on external environment will be discussed.
MAIN BODY
Effect of external and internal factors on Tesco
The external factors that have impact on the organization of Tesco can be described by following
points:
 Technological factors – Advancement in the technology brings many changes in Tesco.
There has been wide use of new technologies to sell goods like billing machines are
installed in the stores for quick billings.
 Economic factors – Economy plays a vital role in impacting the business of Tesco. Tesco
can focus on lowering the prices to increase the sales. This would attract new as well as
existing customers and will help to increase the customer base of the company.
 Political and legal factors – Change in the policies and inconsistent nature of politics
affect the operations of Tesco. Other political and legal factors include the taxation,
tariffs, import restrictions etc. There is greater impact of political and legal factors on the
day to day operations of the business (Rosnizam and et.al., 2020).
 Demographic factors – It is important for Tesco to divide the customers
demographically. This division can be on the basis of gender, age , race, occupation, level
of education etc. each group of customer has to be served well to achieve success.
 Social factors – Tesco focus on the interest of the society by taking care of the socio-
economic status and social factors while developing their products. Catering the needs
and expectations of different groups of people can contribute to business growth.
 Competitive factors – Competitive factors constitutes the external factors that impacts the
working of Tesco. The company has to focus on the working of their rival firms by
evaluating the challenges and the success. Also, they can collect information on changes
in the products and various product developments (Kim and et.al. 2021).