Regent College: Business and Business Environment Report on Tesco

This report provides a comprehensive analysis of Tesco's business environment, focusing on various organizational aspects. It begins by exploring different types of organizations—private, public, and voluntary—and their legal structures, highlighting the characteristics of each. The report then delves into the size and scope of different organizations, using Tesco as a case study to illustrate these concepts. Furthermore, it examines the interrelationship between various organizational functions, such as finance, marketing, production, and procurement, and how these functions contribute to achieving the company's objectives. The report also includes analyses of macro-environmental factors affecting Tesco, along with a SWOT analysis to evaluate its strengths and weaknesses. Finally, it explores the relationship between Tesco's strengths and weaknesses and external factors, providing a holistic understanding of the business environment. The report concludes with an overview of the key findings and their implications for Tesco's strategic planning and operational effectiveness.

Business and Business
environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Purpose and different forms of organisations........................................................................1
P2 Size and scope of different organisation................................................................................5
P3 Interrelation between organisational function and their link with objective of the company
...................................................................................................................................................11
TASK 2..........................................................................................................................................13
P4 Affect of macro environmental factors on Tesco................................................................13
P5 Analysis of strength and weakness......................................................................................15
P6 Relation of strengths and weaknesses with external factors ...............................................16
CONCLUSION .........................................................................................................................18
REFERENCES..............................................................................................................................19

INTRODUCTION
Business environment deals with various external and internal factors which is significant
for the success or failure of an organisation. An enterprise can do planning for the inner changes,
they have capacity to do different task like improve efficiency of the employees, increase their
production etc. But they cannot control some important elements like regulations made by
government, up-gradation in technology etc. (Cavalcante, Kesting and Ulhøi, 2011). The
significance of favourable business environment is increasing because, now, firms understand
that they can only attain their goals if internal as well as external factors support them. An
organisation can make effective plans, they may hold strong position in the market but if they do
not get positive surrounding conduction the business operations than they can face huge loss in a
financial year. Tesco Plc hold a top spot in the retail industry of UK. They are also present in
other nations like Asian and European countries. This file will discuss about different kind of
organisations and their legal structure. Their size and scope will also become part of this report.
Connection between activities performed by an enterprise and its relationship with their
objectives will be included in this assignment. Various significant analyses like SOWT and
PESTLE will come under this file.
TASK 1
P1 Purpose and different forms of organisations

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The reason of existence of every business entity is different. Some firms operates at small level,
they have limited employees and their turnover is also less (Haidar, 2012). But there are many
big corporation who have capacity to make a huge impact on the complete industry.
4

Sometime government also take their assistance for making important decisions. Their are
basically three forms of organisations, private, public and voluntary. They also have various
parts, their objectives are very different from each other.
Private entities include three types, first is sole proprietor, second is partnership and last
one is company. A business which is run by one person is known by the name of sole traders.
They earn less amount and their prime goal is to earn money for fulfilling own and families basic
needs. They do not have any legal binding and their registration is also not compulsory. Plumber,
small grocery store owners, electrician etc. are some of the example of sole proprietor. Limited
resources is not a big issue for them because they do not have any aggressive plan for expansion
of their business. In partnership, minimum two and maximum twenty people run an organisation.
They make a partnership deed (a written agreement) which provide them legal existence.
1

Formation of this document is not compulsory, partners can also create an oral contract. This
form of organisation has more reach compare to previous one. Some partners do not perform any
task in the firm, they just invest their fund.
2

Generally the roles and rule of enterprise is written in the partnership deed. Their main aim is to
earn profit but some partners on salary basis so they do not care about revenue. Recently some
regulations in this field has changed, it is compulsory for limited liability partnership to register
their business with the appropriate government authority.
3

Company is considered as one of the most popular form of organisation, it has sound legal
existence because their registration is compulsory. Tesco also comes under this segment. Their
area of operation it much higher than other two type of business and they have more resources
compare. These enterprise basically have two targets, first is expansion of their corporation and
other is increasing more and more profit. They can easily operate in more than one nation but
they have to follow all the formalities that is present in these countries. Organisational structure
of these firms is very complex because millions of employee work in these corporation.
Companies have to submit some important documents like financial statement to the government
authorities.
Public organisation aims at providing various kind of services and the goods to the public
at a cheap rate or without charging any money. Profit is their secondary objective and some of
the firm are dependant on the grants of government. Their is no question mark on their legal
structure because these companies are made by governing bodies. They hold significant amount
of shares in the corporation and play crucial role in the decision making process. Some people
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think that these enterprises only operate in domestic states or country but this trend has
completely change. They are now becoming prime source of revenue for the government and
they are running business is various part of this world. NHS is the perfect example for this type,
they provide medical services to the public for an economic price. Voluntary organisation never
focus on earning profits. They work for a particular cause and those people who agree with their
idea, join the enterprise. Some of them work against social problems while other try to promote a
new thinking in the society. If they register themselves with appropriate government authority
then they can get some financial assistance from them. Registration is not small firms is not
compulsory but big corporation have to follow some rules like reporting of their financial
statements. Cancer Research UK is an example of this voluntary organisation. They have more
than 40000 volunteers and they are trying to find the cure of cancer.
The international business environment has seen impressive growth in last two decades
because major countries in Asia like China and India are opening their economy for foreign
investment. They are also increasing their production level and selling huge amount of good to
developed economy like USA and UK. Advancement in technology is another factor which is
making a positive impact on the business environment, companies do not have to buy huge
amount of fixed assets in a country for running their operations. They can do most of the work
by using latest technology.
P2 Size and scope of different organisation
5

When an enterprise tries to expand their reach they face various problems. This trouble happen
due to the enhancing business complexity. Sole traders do not face have any issue relating to size
because one person is responsible for making all the calls. The chances of conflicts is not
possible in this kind of private organisation. They do not have much scope of growth, they just
try to earn money on daily basis so they can live a normal life. Size of partnership decide the
orbit of firm. Their mission is to get a decent amount of revenue and they have limited scope of
expansion. Tesco is a private corporation whose vision is to gain the loyalty of the shareholders
by providing the quality goods and services. They are current operating in 12 nation which
reveal the all the necessary information about their size. Almost 476000 people are working in
this company. The scope of their growth is very high because they have not exploited the future
big market like India and China. They have sound presence in retail sector and they are very
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