Understanding the Business and Economic Environment

This report provides an analysis of the business and economic environment of Tesco in the UK, including industry analysis, structure of the chosen industry, and STEEPLE analysis. It also discusses the impact of competitiveness on the future of the business and the challenges faced by the venture.

Understanding the
business and economic
environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Industry Analysis........................................................................................................................3
Structure of the chosen industry..................................................................................................4
STEEPLE Analysis.....................................................................................................................4
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment is the sum total of all the macro environment that is gradually
impacting the overall functionality & the operations of the business. There are certain types of
organisations that are conducting its business in profit oriented, non-profits organisations but
most of the firms are operating their business with the aim of generating more revenue and
profitability. Economics is the branch of economics which analyse the scarcity and the
implications of the resources, its production of goods and services, growth over a period of time
and the welfare over a time. Tesco is the respective business organisation for this assignment, it
is the public limited organsiation that is conducting its venture in retail sector. Furthermore, this
respective report will perform the industry analysis and further this describe the structure of the
business for the entire functionality of the organisation. Moreover, STEEPLE Analysis is being
analysed by social,technological, economical, ethical, political, legal & ethical factors that is
influencing the entire functionality of the venture. This also helps the business which also find
the determinants and evalate the competitiveness in the given market segment.
MAIN BODY
Industry Analysis
Industry analysis is the specific branch of manufacturing, trade and service. This also
helps in understanding the industry in which the company is operating its business which provide
the essential framework for the better analysis of the company. For this assignment, retail
industry is the considered business from United Kingdom standard industrial classification(SIC
2007). It is also being said that the various companies are being operated in the general
merchandise market & they are offering goods & services by the supermarket, conventional
stores, online business. There are various organisation that are conducting in the business & they
are aiming to generate more profitability and revenue. In addition to this, Asda and Sainsbury's
that are suffering and leading to minimise the entire sale of an organisation. All such aspects is
being complied by the company by which they can rightly ensure their sustainability in the given
market.
Structure of the chosen industry
There are various aspects that is leading to have the huge market growth by which they
can rightly ensures the huge profitability and revenue. In this, structure of the retail industry is he

major aspects which needs to be consider while analysis the overall consideration to the target
market. There are various business operated such as centralised venture operations involves the
duties & concern for human resource & their store planning by that all such aspects of the
business can be conducted in an effective manner so that they can ensure the huge profitability
and revenue. This leads to have the easy flow of products and services in the given market place
by identifying and meeting the needs and demand of their consumer who are from United
Kingdom.
STEEPLE Analysis
This is the framework of analysing the overall consideration in the target market that is
influencing the overall operations of the company and thus the brief detail is being given which
helps in the effective working of an organisation. The acronym for STEEPLE Analysis which
basically stands for economical, environmental, political, legal & ethical. In consideration to
Tesco, following are the factors that are illustrate below:
 Social factors: It is being stated that the culture, values and social aspects reflects the
overall change in the market as change in the overall perception can leads to have the
huge impact over the functionality of the venture. In relation to Tesco, They are capture
the large group of customers as the people are shifting for the organic goods by which, it
can be helpful for them so that they can increase the overall functionality of the business.
These are the aspects which is directly related to the choices and the overall eating habits
of the buyer which reflect the choices and the preference & the mind set of the individual
for buying the purchasing capacity of specific commodities & services in the large
marketplace.
 Technological factor: With this variation in the entire market conditions, there is the
entire variation in the business which is impacting the entire operations of the company
which is related to the particular marketplace. In context to Tesco, They are gradually
going to launch the Amazon Go that gradually helps in easy billing by that the individual
an rightly ensures the easy shopping and the benefits in the market.
 Economical factor: These are the aspects which are related to the goal government tax
subsidies on subsidies on import and export and so on which reflect the entire operations
of the venture. Tesco need to understand the influence of such aspect in an effective
manner so that they can move in the right direction.

Analyse the microeconomics aspects that affecting the demand of goods & services with the
demand curve:
Demand is the choice or the preferences of the person in order to buy a specific
commodity as they as they are having sufficient capacity to pay for the same in the large market.
Following are the factors which is impacting the demand which are given below:
 Given price of products: It can be said that price and the quantity is having inverse
relationship and when the prices of the commodity tend to increase then the particular
demand for the good decreases as the people always prefer to have affordable products to
them. In respect to Tesco, Increase in the price leads to decline in the entire demand of
their product and services.
 Income of the buyer: It is the earning of the individual by doing some sort of job. There
is a positive connection between the price and the income of the consumer increase in the
income tends to Increase the overall demands of commodities in the target marketplace.
Enlist the factors which is impacting the supply & what would cause the supply to fall/rise
with the help of supply curve.
Supplies the fundamental concept that define a total availability of product and services
for the further sale in the target market. In context to Tesco, following are factors that is
influencing the overall demands of production services that are illustrated below:
 State of technology: It is also known that an organization is using a updated version of
their technology then it's to increase the overall supply of commodities and services in
the target market. It is the aspect which can reflect the overall supply is the over all
supply of the commodity. In relation to Tesco, When they are using better version of
technology and innovative methods in their production thenIt leads to increase the overall
supply of customer services in the target market. On other end use of obsoleted
technology can lead to slow down the entire supplier commodities in the given market
segment.
 Number of companies in the market: There are different types of companies which are
conducting in the market & they are meeting out competitive Edges in the market. When
there are more number of firms which are conducting in the same sector then the overall
supply of product and services tends to decrease as the consumer is being divided among
the various firms which slowed down the overall profitability. There are leading firms

who are operating in the retail industry that are Morrison's and Asda and they are giving
huge competition to the Tesco.
Explain the competitiveness of the UK market & its impact on future of the business.
There is a huge competition in the United Kingdom as it is the developed country in which
people are using innovative methods and techniques in order to generate more profitability and
Revenue in the target market. Competitiveness is defined as the overall market scenario bitch
able to know whether the company can succeed in the market or not. According to the economics
global model, This is being analyzed that UK's expecting 11th place in 2020 which Tesco can
ensure a good brand image in the leading world.
Examples of random shocks that could understnd the UK government fiscal policy &
analyse if there is an monetary and fiscal policy impact the economy of UK.
 Environmental factor: These are the aspect which is related to the substitutability and
ecological balance performed by the companies by which they can ensure a better
operations and a safety of their environment. There are basically 2 phase which is being
used by the organization that are Remove remove recycle.
 Political factors: Certain factors which are basically related to the stability of
government bodies and its functionality in the United Kingdom. There is a stable
government which is assisting the Tesco company as they are ensuring better functioning
in order to reach to their predefined goal. There are different organizations which are
conducting their business in retail sector so Hector so there are endless state rules which
needs to be followed by them
 Legal factor: These are the aspect which is related to the policies that is being framed by
the government of UK for national and International market. In consideration to the food
retailing industry commission, They have enlisted some bruises or policies which needs
to be followed by the company who all are operating in the retail sector.
 Ethical factors: It is the aspect which is related to the honesty respect and direct
communication with the employees so that they can understand how to work and ensure
better working within the organization. In relation to Tesco, They are offering effective
working in moments so that they can retain their employees in long run.
Discuss the venture problem & challenges that is being faced & criticise on the macro
effects of a business decision.

In order to understand the problem it is being known that Tesco is the public limited
organization that has been entirely owned & controlled by the government body of UK. They're
emphasizing on strict follow up of their rules and policies by which businesses can rightly
substantial in the market for a long period of time. It is also clear that they cannot go out of the
Box as all the business is business is being controlled by the government so they have to follow
the procedures and procedures and their policies in order to ensure that a worker.
CONCLUSION
From the above respective report, it is being concluded that there are certain types of
business which are conducting in the target market. They all are operating with the sole aim of
generating more revenue & profitability by which they can substantial in the competitive market.
For the new steeple analysis is being conducted Which help in understanding the background
factors which is influencing the overall functionality of the venture. Supply and demand for 2
major aspects which ensure the entire flow of good sense services in the market.

REFERENCES
Books and Journals
Koleša, I., Burger, A. and Dickmann, M., 2022. The effects of institutions on emerging market
firms’ international assignment location decisions. Economic and Business
Review, 24(1), p.1.
Panda, A. and Gupta, R.K., 2022. Understanding Organizations and Business Ecosystems in
India Using Business Systems Framework. In Indigenous Indian Management (pp. 307-
345). Palgrave Macmillan, Cham.
Liu, X. and Xia, T., 2022. The innovation paradox of political capital in transition economy firm:
Innovation and political capital. Journal of Business Research, 142, pp.775-790.
Alam, Q. and Grose, R., 2022. Shifting sands in the regional business environment in Australia.
In Regional Businesses in a Changing Global Economy: The Australian Experience (pp.
1-10). Routledge.
Wegwu, M.E., 2022. DEFENSIVE STRATEGIES AND FIRM’S RESILIENCE IN A
DYNAMIC BUSINESS ENVIRONMENT. World Bulletin of Social Sciences, 6, pp.41-
50.
Koleša, I., Burger, A. and Dickmann, M., 2022. The effects of institutions on emerging market
firms’ international assignment location decisions. Economic and Business Review, 24(1), p.1.