A Comprehensive Analysis of Tesco's Business Environment and Impact

This report provides an analysis of Tesco's business environment. It begins with an introduction emphasizing the importance of understanding both internal and external factors for business success, particularly in a competitive market. The report then examines Tesco's strengths, such as its established brand and effective online platforms, and acknowledges its weaknesses, including competition from other retail giants like Asda and Sainsbury. The core of the report applies the PESTLE analysis framework, assessing the impact of political, economic, social, technological, legal, and environmental factors on Tesco. It highlights the stability of the UK's political environment, the positive economic contributions through employment and profitability, and the importance of adapting to societal trends and technological advancements, such as self-checkout systems. The report concludes by emphasizing the need for Tesco to comply with government policies, leverage technology, and consider economic factors to maintain a competitive edge and contribute to the national economy. The report is supported by references to relevant academic literature.

Introduction
It is vital to note that for success of a business enterprise it
is important to check the variables that may impact their
business. It is seen that in today's business environment
there are various competitors of a business. So they have
to analyse and understand the impact of these internal as
well as external factors as they help them to gain
advantage over these competitors and established a strong
brand image in the market (Gorondutse and Hilman,
2019).
Tesco And Its Environment
Name of the Student
External Environment
Political factors: It is vital to know that the political situation of the
country in which the organisation operates has direct impact on the
company. It is seen that in relation to UK the condition is stable and
the government is in support of Tesco as they help in online good
profit so the company's able to work effectively there.
Economic factors: This is the next point that is taken into
consideration in PESTLE analysis. Economic factors includes the
demand and supply, inflation rate, interest rate, GDP of the nation
etc. These economic factors may lead to success as well as failure of
the business organisation. It is noted that Tesco provides good rate of
employment to the nation and at the same time the profitability of
Tesco is high so there is positive impact on the company.
Socio cultural factors: Social factors mean the lifestyle nature and
desire of people that are living in the society (Sari, 2018). It is
important to note that a proper research related to trends in the
market helps Tesco to work effectively and cater the needs and wants
of the customers and attain success.
Technological factors: It is a known fact that technology keeps on
updating on a regular pace. Each and every company that wants to
gain advantage over the competitors should use latest technology.
Here it is seen that Tesco has their own self checkout points that are
helpful in the situation of covid-19 is spread that the company is
using the latest technology.
How the company impact
its context External
Environment
• From the PESTLE analysis it is being evaluated that
the company that follows all the policies as well as
laws that are applicable to them get full support of
Government and are able to achieve success and
growth.
• At the same time it is important to use latest
technology and follow the trends that are present in
the market to gain advantage over the competitors
and work effectively.
• Economic factors also have direct impact on the
operations of business the company should always
take care of their operations and try to earn good
amount of profit and contribute to the economy of the
nation.
Internal Factors
Strength
• Tesco is a multinational organisation which has
established a strong and a positive image in the market
that helps them to serve more customers and earned
more revenues.
• The company uses online platforms in a effective
manner that helps them to cover more area and serve
wider customer group. Along with that it shows strong
marketing by the company.
Weakness
• There are number of retail stores and companies that
are established in UK. So Tesco has to face a use
competition from Asda and Sainsbury.
References
Gorondutse, A.H. and Hilman, H., 2019. Testing the
effect of business-level strategy on performance of
hotels. Global Business Review, 20(5), pp.1141-1154.