Business Environment Analysis: Tesco's PESTLE and SWOT Analysis Report

This report provides a comprehensive analysis of the business environment, examining the different types and purposes of various organizations, including private, public, and voluntary firms, and their legal structures. It explores the size and scope of these organizations and their varying objectives. The report delves into the interdependencies of functional units within an organization, such as human resources, marketing, operations, and finance, highlighting their collaborative roles in achieving business goals. Furthermore, it assesses the positive and negative impacts of the macro-environment on businesses, specifically focusing on the political and economic factors. The report culminates in a detailed PESTLE and SWOT analysis of Tesco, evaluating the external and internal factors affecting the company's operations and strategic positioning within the market. This analysis provides valuable insights into Tesco's strengths, weaknesses, opportunities, and threats, as well as the political, economic, social, technological, legal, and environmental factors influencing its performance.

BUSINESS AND THE BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION.................................................................................................................................4
TASK 1.................................................................................................................................................4
1.Diffrent types and purposes of various organisations.....................................................................4
P2. Size and Scope of the organisations............................................................................................5
TASK 2.................................................................................................................................................6
P3. Interdependencies of various functional units of the organisation on each other.........................6
TASK 3.................................................................................................................................................7
P4. Positive and negative impact of the Macro Environment............................................................7
TASK 4.................................................................................................................................................8
P5.PESTLE analysis of TESCO........................................................................................................8
P6. SWOT Analysis of TESCO.........................................................................................................9
CONCUSION......................................................................................................................................10
REFERENCES....................................................................................................................................11

INTRODUCTION
Business environment plays an important role for the every organisation as it helps to
determine the impact of various changes that an organisation faces in the path of conducting
successful business activities. Every organisation has to cope up with these dynamic changes
that lead to create an impactful resultant in the form of quality product and services which is
required to satisfy the needs and wants of the customer and to create profit in the investment
which was done for the production (Armstrong and et.al.,2015). The following report
includes the description of the types of the organisation their scope and size along with the
legal structure of them. It also includes determination of the dependency of various functional
department of the organisation along with the external and internal analysis of TESCO which
is PESTLE and SWOT for determining the impact of various aspects on the operations of the
company. With this one can get deep analysis of the organisational structure of the company.
TASK 1
1.Diffrent types and purposes of various organisations.
There are various organisations which are public private and voluntary firms. They
have different aims and objectives and also have. The firms which are private have the basic
aim of earning profit and expanding their business so that they can generate lot of profit
which not only provides advantages to them but also give them opportunities for flourishing
their business in many aspects which are considered for the successful business. For them
fulfilling the needs, wants and requirements of the customer is the primary goal which
provides the direction for producing goods and services that are quality approved and
provides a lot of satisfaction to the customer. They seek for various opportunities for
increasing their market share in the economy. They have to compete with the customers in
order to sustain in the market and continuously work for the improvement of the firm in many
aspects such as functional, operational and many more. The private organisation are owned
by the individual or the group of individual who are the stakeholders and take various
important decision for the company (Botha, Kourie and Snyman, 2014).
The public organisation provides services to the people so that they can do the work
for various services that can provide quality services to the natives. These companies are
owned by the government or public bodies or has the maximum shares of the company along
with some private individual. The aim of these companies is to provide quality goods and
services to the customers. They does not have greed for earning profit or even expansion.
They are strong independent bodies which gets fund from the government for the process of
production. Whereas the voluntary organisation are just opposite as their aim is to do
voluntary work for the society which is very important for them as they have major goals for
performing social work to benefit the society by giving them something in return. They
normally runs the business performs every related activities but the profit which is earned

from the business is not used for them rather they so some charity or some donation so that
thy can make the surrounding better.
The legal structure of these organisation is very different as the private company can
be owned and run by the individual . can be the sole trader or can have the company in
partnership or in private limited as the public organizations uses public limited. One can
recognise these companies through the owners and the type of limited after the name of the
company. Under the private organisation franchise also comes in which the company allows
other individual to use their brand name and provides various product and service to the
customer under their name and divide whatever the profit they earn. The individual by the
company for using their band name which is very important for the company. The voluntary
organisations can be various non governmental bodies or the charity houses which uses the
donation provided them for the running of business that benefits those who are in need. The
advantages of the company is that it works for the betterment of the society and provides
opportunities of development to the people who belong to those communities who seek for
voluntary help for their survivals such as minors (Epifanova and et. al.,2015).
P2. Size and Scope of the organisations
The size and scope of the organisation which comes under the category of private ,
public and voluntary can vary
The private organization
The private organization can run by the individual and the groups of individuals upto not
more than fifty individuals who can own the shares of the company. Also they can have
companies on equal shares which is known as the partnership or the variations in the amount
of shares among the individuals. In the organisation which is private limited has individuals
less than two hundred fifty. These are very important to know as it can create disputes among
the shareholders so they their shares has been concluded in the document which determines
the status of the share amount whereas in the private company which can all own the various
government bodies or both the private individual person where the government has more
shares as compared to the private one. The number of share holders can be more than fifty in
the public firm and the voluntary organisation can be own by the single individual as it is a
small firm which is mostly a small scale business or a nongovernmental organisations .The
scope of all the organisation is very different which completely depends upon the aims and
objectives of the organisation. The private organisation has the widest scope as they aim to
expand their business not only in the country but across the world. They have the global
approach and tries to do business across the borders in order to in more profit and recognition
in order to increase the base of the customer and becomes a brand in the mindset of all
consumers so that they can get promoted very well.
The public firms
The public firms have narrow scope as compared to the private firm as they mostly operates
in the political boundaries and tries to provide benefit to the native of the state or the country
and does not aim to reach across the border as they have aim to provide quality services and

products to their own people so that they can avail quality services (Epifanova and et.
al.,2015). These firms are mostly operated as the public limited who provides maximum
shares to the government so that they take funds from the investment from the public in order
to provide them several services.
The voluntary organisation
The voluntary organisation are those who have limited scope as they are mostly small scale
organisation which have people who belongs to the local community and promotes their
culture and them in order to provide benefit to them conducting various social services for
their betterment. Their scope is limited as they concentrate on the particular area where they
operates and provides employment opportunity to the people who lives there. But they also
provides the charity work to them , their funding is mostly operated though the donation and
charity amount which are given to them by the government or the individuals who wants to
do some contribution to the society as these organisation provides goods and services to the
local level and earns he respective profit from them for the use of the work which is related to
the upliftment of the society.
TASK 2
P3. Interdependencies of various functional units of the organisation on each other.
Every organisation has several functional units which are related to each other and
their coordinative interrelationship lead to the effective functioning of the organisation in
order to accomplish the goals and objectives of the organisation. There are several functional
departments such as human resource, marketing and sales, operations and financial
department which together work for the successful conduction for day to day business
activities. The human resource department works for the recruitment and selection of the
right candidate for the particular production that provides the individual who has complete
calibre to provide extra ordinary efforts for the company. They helps to make the working
environment peaceful and productive by establishing the efforts for the development of good
relationship with the employees. These individuals are the person who provides the one the
opportunity for accomplishing the objectives of the business. Human resource department
works on the continuous development of the skills of the worker by conducting various
sessions for the enhancement of their kills which are required for increasing the efficiency
and effectiveness of the work. Human resource basically think upon the aspect which
provides employees to various departments on right time and makes sure that there is no
shortage of workers and even the surplus which can lead to the wastage of the resources
which are to be used. The marketing and sales department works on the making of the
strategies for the promotional as well as the selling of the bulk of products to the customer by
attracting them through various promotions and making tactics for the sales plan which
includes the team of individual which is provided by the human resource department (Savrul,
Incekara and Sener,2014). They provide various marketing plan which decide that lead to
the generation of the profit in the organisation and also provide the opportunity for the
company to grow till the maturity stage and then sustain in the market by increasing the share

in the economy of market and compete with the rivals. The operational department works on
the production and operation where it includes all the processes stating form the procurement
of the resources, to their storage and transportation along with the production with great
efficiency. The number of lots of the product is decided by the amount of demand which is
decided by the marketing department for the production team of the company. They work
with the quality aspect of the services and goods which are provide on time to the customers.
The most important department is the financial department which handles all the financial
aspect related to company in which they provide the calculate value of the success f the
project and the investment plan that requires some amount of investment which is provided
by this department and makes sure tht company bear no losses and get complete profit in
order to flourish their business in the economy . The financial department is the building
block of the organisation as it provides the whole plan for the work in the financial term and
is the basis for the decision making of the board members of the company whose aim is to
complete expand the business in future aspect
inter relationship of departments 1
TASK 3
P4. Positive and negative impact of the Macro Environment
The impacts form the macro environment on Tesco can be positive as well as
negative. The political factor can provide a great expansion to the business of the company f
the scenario is stable otherwise it can create worst impact on the company and even can lead
to the end of it. The favourable economics factor can make the organisation financially strong
which is an important aspect of the company to be strong enough to hold any crisis in case of
emergency. The various aspect of the economy can lead to increase the share of the company
in the market making them the most leading company in the economy. Also the unfavourable
economic factor such as recession or deflation can lead to minimise the money floatation

form the market making the business very hard to run even can face liquidation which can
lead to bear many losses to company. The economy lead to the proper flourishment of the
various organisation. The societal aspects of the macro environment plays a vey crucial role
as the employees belong to different social class who have varied economic status which lead
to different needs and requirements and also several cultural beliefs and thought that can
provide hindrance o various decision of the company on the basis of this it can led to tension
by in the environment. Also if the communities work together they can lead to effective
adoption of various business tactics which can lead to the formation of the impactful aspect
on the society and the company as well (Cull and et. al., 2015). The technological updating is
very necessary for every organisation in order to reduce the human effort in the company.
This lead to the effective check on the various transaction of the company and reduces the
human error but with the adoption of various technologies which are completely advanced
can led to the complexity in the working struct4ure of the organisation. Various innovative
ideas for the processing of the goods can be adopted which can be reason for producing
goods which is very efficient in terms of quality and quantity as well but the main problem
with the adoption of advance technology can be the disagreement of the employee to adopt
these strategies which are very much effective Also various environmental aspects can affect
the working of the firm as the favourable atmospheric events helps to conduct the various
business activities successfully otherwise in the unfavourable environmental condition can
lead to disturbance in the activities of the business. The worst climatic condition can lead to
various ill effects on the company as the employees would not get ready to working such
environment where the conditioned are not appropriate for the working. Also procuring
various resources and sending them as the final product requires a lot of efforts which has to
be taken care. The more far the organisation that would lead to the development of various
problems associated with the transportation that would lead to rise in the price of the product
thus affecting the consumer on the basis of these kind Of strategies that can create harm to
the good will of the company.
TASK 4
P5.PESTLE analysis of TESCO
The PESTLE analysis is the external analysis of the organisation which is done to
determine the impact of the external factors on the working of the company. As the external
world is full of dynamic changes company has to make various strategies that cope up with
the these changes for the effective business management of the organisation. The PESTLE
analysis is discussed below:

pestle analysis 1
Political factor
Political aspect impact the organisation adversely which lead to the halt in the various
functions and operations of the company that provides them an opportunity to gain profit.
The political scenario of the company leads to the facilitation of various operations of the
production as well the expansion of the company across the company (Virglerová, Dobes,
and Vojtovic, 2016). But the disturbing political scenario leads to the resistance in the
production of the company which harms the business and lead to many losses. Even they are
not able to implement business strategies where there is lot of political tension
Economic factor
Various economical factors lead to the fluorescent of the successful business in the
market. The economic state of the country decides the future of the company as during the
recession on company can expand their business and will mostly suffer losses in the various
activities The other aspects such as inflation rate affects a lot so the company has to see
whether the economy has favourable or non favourable surroundings for taking various
important decision related to business.
Social Factor
The socio cultural aspect of the economy leads to effect the working environment of
the company. As it deals with the aspects such as the cultural beliefs, thoughts of the

individuals who belongs to different social groups and tends to follow them strongly.
Company has to deal with this aspect effectively.
Technological Factor
These are the factors which lead to the technological advancement of the company as
the current word is facing the technological revolution which leads to the introduction fo the
various new software that are very beneficial for the organisation and provides time and cost
effective approach after the implementation.
Legal Factors
A company can survive bitterly where the legal rules and regulations are not so strict
and allows every individual to start their business with no direct imposition of various legal
formalities that stops the person from tasking the decision of starting a business in the market.
The legal factors leads to the control for all the activities at the cost of following of various
rules under the regulating body such as courts. They makes sure that thee id no conduction of
illegal activities that can harm the economy and provide various punishment to those who
breaks these policies and rules. Therefore a country were it has strict rules lead to decrease in
the business activities (Eling, and Schaper, 2017).
Environmental factors
Environmental factors includes the aspects such as geographical factors, climatic
condition and the surroundings of the company. Company which is situated on the site where
there is no facility of the transport will face lack of employees and where the climatic
conditions are worst. Therefore company has to seek the favourable environments factors that
provide opportunities to work for many individuals out there.
P6. SWOT Analysis of TESCO
STRENGTH
They are considered as the top retail
brand as they are leading rulers of the market
as they are totally established around the
twelve countries in the Europeans and Asia
which means that they have a strong hold in
the market and are the largest share holder in
the market. Their brand are strongly
recognised by summer and they have huge
number of customer base who are loyal to
their brand. The strong brand recognition has
lead them to develop an unique identity
which cannot be comprised by the customers.
They have effective marketing strategies that
lead them to implement effectively in the
market thus providing strong competition to
the rivals. Their products are highly valued
and has created a differential impact in the
Weakness
They have wide range of products
that lacks the inappropriate controlling of the
functions and also the profit of the company
is badly impacted by the bad debt from the
credit cards and various house hold items.
Also entering into various market without the
proper knowledge of it lead to in effective
strategies. Their range of product are more
vulnerable to get copied which lead to the
availability of the large number of substitute
in the market. The lack of knowledge of the
new market has lead them to failure in new
products which is harming their image as the
global leader of certain products (Constangy,
Marger and Brompton, 2015).. The retail
market is very volatile in natures the
customer needs and requirement changes
according to the latest trends which is not

mindset of the customer which has lead them
to be the leader in them market.
adopted by the company as they are stuck to
a particular fashion category of the clothes.
They have the go limit on the target customer
which leads to decrease in the scope of the
retail business with respect to the basis of the
customer.
Opportunity
The expansion can be done into the
various markets as it has wide range of
products which are very regular household
items. Their entry in to the market of cell
phones has provided them various
opportunities to expand their business in this
aspect. There can be various mergers with the
local rulers of the market which would lead
to increase the customer base and provide
them a foundation in new market and a
chance to explore more and create its image
in the whole new concept which not only
expand their business but will also generates
lots of opportunities for the product
development.
Threat
In the retail market there are already
well established leaders such as Morrison,
Sainsbury who already have large customers
and provides similar products which provides
them threat of taking way their consumers
thought the effective Strategies. The various
similar services provided by the rivals can
posses string threat and the switching cost to
these rivals are not much which lead to the
decrease in the customer base of the company
and also provide the disadvantage of being
copied in the strategies which is related to
branding, promoting and even pricing. The
availability of similar product at the price
which is less than the price one of the
TESCO company can lead to attract the
customer ore towards them and can create
adverse impact on the company’s share in the
market and also provide a sense of security
among the employees of the organisation
(Constangy, Marger and Brompton, 2015)..
CONCUSION
It has been concluded that there are three type of organisation which are public,
private and voluntary. These organisation have various sizes and scope along with their legal
structure. The various departments of the company are inter resulted to each other that
facilitates the working of the organisation to accomplish the goals and objectives of the
company. There are certain impacts of the macro environment which are negative as well as
positive. There has been virus factors such as political ,economical, social, legal and
environmental that affects the organisation impactfully ad also the determination of the swot
which has described the various strength, weakness, threat and opportunities for the TESCO

REFERENCES
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