Analysis of Tesco's Business Resources, Finance, and Performance

This report provides a comprehensive analysis of Tesco's business resources. It begins by examining recruitment documentation and the required employability, personal, and communication skills for various roles within the company. The report then delves into the physical and technological resources essential for Tesco's operations, highlighting their importance in maintaining efficiency and profitability. Furthermore, it explores both internal and external sources of finance utilized by Tesco, providing insights into the company's financial strategies. The report also includes an interpretation of trading, profit and loss accounts, and balance sheets, demonstrating how these financial statements are used to assess the company's performance. Finally, it illustrates the use of budgets as a means of exercising financial control, offering a well-rounded overview of Tesco's business practices.

BUSINESS RESOURCES

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Recruitment documentation used in Tesco company...........................................................1
P2 Main employability and personal and communication skills required .................................2
TASK 2............................................................................................................................................3
P3 Physical and Technological resources required in operation at Tesco..................................3
TASK 3............................................................................................................................................4
P4 Sources of internal and external finance for Tesco ...............................................................4
TASK 4............................................................................................................................................5
P5 Interpret contents of trading, profit and loss and also balance sheet for Tesco.....................5
P6 Illustrate use of budgets as a means of exercising ................................................................7
P7 Financial state of business.....................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
An economic or productive factor required to accomplish an activity, or as means to
undertake an enterprise and achieve desired outcome. Three most basic resource are land, labour,
and capital; other resources include energy, entrepreneurship, information, expertise,
management, and time (Granovetter, 2010). Tesco company is a big grocery company. It
provides toys, grocery items, clothes, electronics etc. In this report, mentioned about the
documentation of recruitment which are used in Tesco. There are main employability, personal
and communication skills are required at the time of applying for a particular job role. In a
company, there are some requirement of technological and physical resources in the operation of
Tesco. In this organisation, there are some internal and external finance sources which are
necessary. This company interpret the content of a trading and also profit and loss account and
balance sheet to know the income and expenses.
TASK 1
P1 Recruitment documentation used in Tesco company
Job Title- Customer service manager at Tesco
Job description – Customer service managers at Tesco are there to ensure that customers
are satisfied with the service they are being given, they also need to ensure that other staff are
complying with the businesses policy to provide excellent customer service (George and Bock,
2011). Customer service managers will also help develop and implement the specifics of the
organisations customer service policy, find ways to measure customer satisfaction, improve
services, manage a team of customer services staff and handle enquiries from customers.
Requirements of the job that Tesco want the customer service employees to have:
Soft skills
 Communication skills – needs to be sufficient enough to be able to help and
inform customers and instruct colleagues on customer service policies
 Listening skills – to understand what customers need and listen to input from
other colleagues on how to improve customer service
 Problem-solving skills – be able to address any issues that are bought up from
either colleagues or customers
 Confidence, patience, politeness, tact and diplomacy
1

 Motivational skills – helps with the ability to lead a team of customer service
assistants.
 Creative thinking skills – gives the ability to come up with new improvements
to the customer service policies (Astrachan, 2010).
 An ability to work well under pressure.
 Organisational skills and planning skills.
 Good personal presentation – as will be working face-to-face with customers
 A commitment to improve your own personal customer service skills on an
ongoing basis.
 Time management.
Hard skills (not necessary but desirable)
 Business studies degree
 Consumer studies degree
 Management studies degree
 Marketing degree
P2 Main employability and personal and communication skills required
In Tesco company, it is necessary to have the employability, communication and personal
skills at the time of applying for a particular job profile.
Employability skills- These skills can be defined as a skills that a person needs to have
in order to get a job and/or be effective in the job role he or she has. Such skills allow the
employee or person to have a mutual and friendly relationship with colleagues or the manager
thus if there are any problems that arise they will be resolved efficiently (Aspara Hietanen and
Tikkanen, 2010). There are many examples of employability skills that employees or people
applying for jobs should possess which include; qualification and experience that are directly
linked to the job that is being applied for.
Personal skills- It can be defined as a skills that a person may possess but doesn’t
necessarily need when applying for a specific job role. There are many examples of such skills
which would benefit the business including speaking different languages, trustworthy and having
a sense a humour. It is good if employees or applicants possess such sills when applying for a job
as it will make them more likely to get the job as it shows the employer other skills that the
2

employee/applicant have that can help the business, these skills are useful for a lot of different
jobs.
Communication skills- These can be defined as a skills that help a person convey
information to another, person efficiently and with ease (Al-Debei and Avison, 2010). Managers
or employees with good written or verbal, communication skills will benefit the business, this is
because they will be able to talk and,understand each other properly.
TASK 2
P3 Physical and Technological resources required in operation at Tesco
The main physical and technological resources required in an organisation, and how the
management of human, physical and technological resources can improve the performance of
Tesco.
Physical resources
Some of the main physical resources for Tesco are their premises, machinery,
equipment, materials and their stock. I have listed these as the main resources required as they
are huge factoring reasons as to why and how Tesco makes such huge amounts of profit.
A business can’t carry out its day to day activities without having a system in place which
manages physical resources. Physical resources can include; buildings and premises, machinery,
materials (and even waste) and equipment. The management of the businesses machinery greatly
helps increase performance of Tesco as it means they can produce products faster, deliver and
receive products faster, and serve customers faster and more efficiently (Marston, et.al., 2011).
Lack of equipment or bad management in Tesco could mean production of products and
customer service in some aspects of the business running couldn’t be carried out as efficiently or
at all.
Things classified as equipment could be IT hardware and software that must both be
managed extremely carefully. No one unauthorised to do so should be able to access the IT
hardware, this can be enforced with physical barriers and surveillance. The software should also
be protected with adequate security and firewalls etc. to prevent people from accessing Tesco’s
databases of customers and products, which could cause a huge loss of reputation and money if it
was accessed by unauthorised personnel.
Technological Resources
3

In Tesco, technological resources include their intellectual property, their
copyrights/patents, and their experience and skill. Their intellectual property is, put simply, their
ideas; things that make them unique. This would include things such as their logo, their ‘Tesco
value’ range, and schemes such as the club card and the point reward scheme.
The management of these resources can greatly improve Tesco’s performance. If the IP is
kept up to date and fully modernised this will give them a competitive advantage, as long as the
ideas are original and not different versions of competitor’s ideas (McGrath, 2010). The IP of
Tesco is what makes them Tesco, and will be how consumers recognise the brand; if this is kept
in good light customers will trust the business and feel connected and familiar with it. By
recruiting successful and experienced staff into the management, they can guarantee themselves
to make the best decisions possible, and of course, the experience of the business as a whole also
makes them what they are today.
TASK 3
P4 Sources of internal and external finance for Tesco
Tesco uses two types of finance sources internal and external:
Internal sources
The founder of Tesco used his own personal savings (owner’s savings) to start up
business, he used the money to pay for war-surplus groceries which was what the business
started
out selling, he also used his own money to pay for the market stall that he used to sell the
goods he bought (Carroll and Shabana, 2010). The founder then used profits (capital from profits
) of the business to
expand the company which means that the profits would increase as they would be selling more
stock because they had more variety and were in different areas which made it accessible to more
people, in 2014.
External Sources
Tesco now is a very large company so not all forms of external finance don’t apply to
them, such as money from banks
building societies, government grants and money from friends and family. Tesco could’ve got
money from banks in the form of a business loan or the use of an overdraft
4

facility on the business account, an overdraft facility means that you can
withdraw money from your account up to a point without having money in it, this would be
set when the account is set up and is called an overdraft limit. Government grants are available
from the EU, national government and local
government, the money that is granted to a person does not have to be paid back (Sharma, et.al.,
2010). The
founder of Tesco could’ve used money from friends and family to start up the business as he
may not have had enough money in his own personal savings.
TASK 4
P5 Interpret contents of trading, profit and loss and also balance sheet for Tesco
Interpret the contents of a trading and profit and loss account and balance sheet for a
selected company explaining how accounting ratios can be used to monitor the financial
performance of the organisation .
Profit and Loss account- It will not tell you about the underlying health of the business,
such as how much money it owes or is owed and what the value of its assets are. It shows how
much money did business made in a year. There are different sections of P&L which include:
 Sales- It is the total value of what you’ve sold during the period of time. The formula for
it is price time’s quantity. Cost of sales- These are the costs that are directly related to the sales you have made. It
includes raw materials or stock you have purchased to resell. It may also include the cost
of creating the items that you sold, including the cost of staff time if you are selling
service. Gross Profit – This is the sum of sales revenue minus cost of sales (Zott, Amit and
Massa, 2011). It tells you how much profit you are making directly from your sales. Operating Costs – These are all the other costs associated with running a business, such
as the rent and rates on your premises, accountancy and legal fees, and depreciation.
These costs cannot be directly linked to your sales and may not change very much even if
your sales figures were to change significantly.
5

 Net Profit – This is the gross profit minus the operating costs. This is almost the true
profit of your business because it’s made up of all the income and all the costs.
Balance sheet
A balance sheet shows the value of a business on a particular date. A balance sheet shows what
the business owns and owes. It is also used as a guide for solvency of the company.
 In first group is included everything that can be liquidated (sold for cash) including stock,
cash, and money owed by customers, are current assets (Osterwalder and Pigneur, 2010).
These are usually short term.
 Second group is more long term including property, machinery, patents and long term
investments these are called fixed assets, which are long term liquidation.
 Third part of balance sheet is current liabilities and they are what the business owes in
the short term: money owed to suppliers, taxes due, short-term loans and overdrafts.
6

 The last group is long-term liabilities they are what the business owes in the long-term –
to be paid after one year, as well as capital and reserves.
P6 Illustrate use of budgets as a means of exercising
Fixed cost = 5600, variable cost per unit = 9 , selling price per unit = 20
Contribution= selling cost – variable cost
20-9 = 11
Break even point = fixed cost/ contribution
5600/11= 509.09
According to the data of Handy ltd. which generally deal with cars whether they are new
or old. According to their data it get identified that fixed cost is 5600. It is a such type of cost
which do not get varied and remain stable in long run purpose of a business (Zott and Amit,
2010). Their variable cost per unit is 9. this cost get varied according to the situation of
production. Although their selling price is 20. this type of price is that on which an organisation
sale out their products. The break even point is that condition when a firm lead not to produce
more than that. So as per the analysis it get measure that break even point is 509.
P7 Financial state of business
The money related clarification is about the survey of the salary decree of a referred to
association by considering all the critical crude numbers (Montgomery, 2011). In the pay of
7

Tesco association toward the beginning they have 53 however toward the complete of the year
they have only 14 which exhibits the absence of store due to the achieved of various expenses. In
a general sense wage verbalization depicts the general exchange contributed out the association
income driven growth by considering all the inward and external factors.
Beside this budgetary announcement exhibits the certified rate of benefit for the wander
with the help of various other little expenses and supportive approaches. Pay go about as an
amazingly steady gadget and methodology while setting up a yearly spending arrangement since
it takes care of various expenses and furthermore advantage which was earned by the association
(Chaffey and White, 2010). On the other hand Tesco is especially worried over their money
related enunciation in view of their fruitful part in a business. Beside this it furthermore helps in
evaluating exact need of spending arrangement in finishing their associations focuses as fast as
time allows by diminishing botches and oversights. In conclusion pay clarifications is greatly
helpful while organizing process.
CONCLUSION
It is concluded from the above report that in Tesco there is a need to some skills like
employability, communication and personal for the job. In this report studied that the break even
point of Handy ltd. Is 5.9.09. From this point it is fixed that the company can not produce more
than this limit.
8

REFERENCES
Books & Journals
Al-Debei, M.M. and Avison, D., 2010. Developing a unified framework of the business model
concept.European Journal of Information Systems.19(3). pp.359-376.
Aspara, J., Hietanen, J. and Tikkanen, H., 2010. Business model innovation vs replication:
financial performance implications of strategic emphases.Journal of Strategic
Marketing.18(1). pp.39-56.
Astrachan, J.H., 2010. Strategy in family business: Toward a multidimensional research
agenda.Journal of Family Business Strategy.1(1). pp.6-14.
Carroll, A.B. and Shabana, K.M., 2010. The business case for corporate social responsibility: A
review of concepts, research and practice.International journal of management
reviews.12(1). pp.85-105.
Chaffey, D. and White, G., 2010.Business information management: improving performance
using information systems. Pearson Education.
George, G. and Bock, A.J., 2011. The business model in practice and its implications for
entrepreneurship research..Entrepreneurship theory and practice.35(1). pp.83-111.
Granovetter, M., 2010. 19 Business Groups and Social Organization.The handbook of economic
sociology. p.429.
Marston, S., et.al., 2011. Cloud computing—The business perspective.Decision support
systems.51(1). pp.176-189.
McGrath, R.G., 2010. Business models: A discovery driven approach.Long range
planning.43(2). pp.247-261.
Montgomery, C.A. ed., 2011.Resource-based and evolutionary theories of the firm: towards a
synthesis. Springer Science & Business Media.
Osterwalder, A. and Pigneur, Y., 2010.Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Sharma, R., et.al., 2010, January. Business Analytics and Competitive Advantage: A Review and
a Research Agenda. In DSS(pp. 187-198).
Zott, C. and Amit, R., 2010. Business model design: an activity system perspective.Long range
planning.43(2). pp.216-226.
Zott, C., Amit, R. and Massa, L., 2011. The business model: recent developments and future
research.Journal of management.37(4). pp.1019-1042.
ONLINE
Business Resources, 2017. [Online]. Available through <https://www.fpb.org/business-
resources>. [Accessed on 6th June, 2017].
9