BTEC Level 4 Business Environment Analysis of Tesco

This report provides an analysis of Tesco's business and its environment, focusing on the macro and micro factors influencing its operations. The report begins with an introduction to the business environment and its significance for effective management. It then proceeds to identify the positive and negative impacts of the macro environment on Tesco, utilizing a PESTEL analysis to examine political, economic, social, technological, environmental, and legal factors. The internal strengths and weaknesses of Tesco are also explored, highlighting its market position, customer base, and financial support. Furthermore, the report examines how these strengths and weaknesses interrelate with external macro factors, such as changes in tax rates, technological advancements, and customer preferences. The conclusion summarizes the key findings and emphasizes the importance of understanding the business environment for organizational growth and success, with references to relevant academic sources.

Business and Business Environment

TABLE OF CONTENTS
 INTRODUCTION
 P4 Describing positive and negative factor of macro environment on business
operations
 P5 Explaining internal strength and weaknesses of TESCO
 P6 Explaining how the strength and weaknesses interrelate with external macro factor
 Conclusion
 References

INTRODUCTION
 Business environment is integral part of the effective and efficient management of business.
 This help to determine the various factors and aspects of business which are important for successful within the
environment.
 Business environment is give the perfect shape to business segment with product line. The present report is
based on the “Tesco” which is the British multinational groceries and retail firm.
 The presentation will identify by positive and negative impacts of macro environment on business environment.
 To analysis the macro environment presentation will explain by PESTEL analysis.
 This will also explain by external and internal analysis of Tesco by identifying strength and weakness. It will
also explain interrelation between strength and weakness with the external factors.

LO 3
P4 Describing positive and negative factor of macro
environment on business operations
 To identify the macro environment of the company, PESTLE analysis is uses which is as
mention below:
 Political Factor: This factor affect the overall situation of the company such that
political stability affect the company's performance.
 Positive impact:If Country has the political stability then it will creates positive impact upon
the company's performance such that it will affect the business sales in positive way.
 As TESCO also plays an important part for creating employment opportunities which in turn
increases the demand of the customer products and diversified its workplace as well.
 Negative Impact: If government of UK suddenly increases the Tax rates, then it directly
increases the price rate of company's product. As a result, customers are not spent their money
and it decreases the sales of the firm which creates negative impact.

P5 Explaining internal strength and weaknesses of
TESCO
 Strength:
 TESCO is one of the biggest grocery retail store in UK and also occupies the leading market
share in UK.
 It has more than 6800 stores in almost 14 countries and it generates revenue from its grocery
stores.
 Company has strong customer base and financial support also as well. Apart from this, it also
offers a thousand of job opportunities to people which creates positive impact upon its brand
image.
 TESCO also receive many awards and also uses advance technology in its working place to
enhance the customer shopping experience.

Continued...
 Opportunities:
 The company can use strategic alliance with other brand and also admire company to offer many products to attract
customers.
 TESCO can also grow its business online and can do home delivery service which help to increase the sales and profit.
 Threat:
 Faces tough competition from its rival and negative controversy in social media also affect the business brand reputation.
 Fluctuation in economic market of UK also leads to create threat in UK.

P6 Explaining how the strength and weaknesses
interrelate with external macro factor
 Strength and weakness are interrelated with micro factor such that TESCO has the brand image but sudden change in tax rate
and legal laws creates threat and thus it leads to affect the brand image.
 As per Technological factor, company follow new techniques which creates an opportunity for TESCO to establish its new
business at different country.
 By analysing the customers' taste and preference, TESCO should provide organic and healthy food that helps to attract wide
range of customers and increases company's sales as well.
 As company is financially viable, also has sufficient financial resources which creates an opportunity to establish its unit in
other country. This also help to face the challenges arises due to sudden change in economic factors.
 The company also uses different natural resources that also provides products and services such that it also work to reduce the
carbon footprint up to 20% so that the environmental laws can easily meet. On the other side, it also helps to sustain the brand
image in market and overcome the weakness as well.

Conclusion
 From the above presentation it had
been concluded that the business
environment has important and
effective for business and its growth
factors.

REFERENCES
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 Online
 SWOT Analysis of TESCO. 2018. [Online]. Available through: <https://bstrategyhub.com/tesco-swot-analysis-
2019swot-analysis-of-tesco/>.

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