Tesco's Business Environment: Industry Analysis and STEEPLE Framework

This report provides a comprehensive analysis of Tesco's business and economic environment in the UK. It begins with an industry analysis, detailing the structure of the retail industry and Tesco's position within it. The report then employs the STEEPLE framework to evaluate the social, technological, economic, environmental, political, legal, and ethical factors influencing Tesco's operations. It explores the competitiveness of the UK market and its impact on Tesco's future, including the influence of random shocks and government fiscal policy. The analysis covers microeconomic factors affecting demand and supply, and concludes with a discussion of the business problems and challenges faced by Tesco, along with a critique of the external effects of its business decisions. Desklib provides access to this and other solved assignments for students.

Understanding the
business and economic
environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Industry Analysis........................................................................................................................3
Structure of the chosen industry..................................................................................................4
STEEPLE Analysis.....................................................................................................................4
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment defined as the external influence, circumstances that are not
control by an organisation and this is having major impact that how they are being influencing
the particular market. There are different types of companies which are operating in the market
and that are company, non-profit organisation and the voluntary firms that are basically operating
their business with the consideration of generating higher revenue in the target marketplace.
They are being working with the sole aim of having huge profitability and revenue so that they
can rightly serve the marketplace. For this respective report, Tesco is the chosen company which
is operating in the market, It is the public limited company which is operating in retail
industry(Tesco PLC, 2020). Moreover, This report will cover the analysis of the chosen industry
and also describe the structure for the same so overall functionality of the business can be
determined. Furthermore, STEEPLE Analysis is being conducted by analysing their social,
technological, economical, ethical, political, legal and ethical factor and in this determinants,
also analyse the competitiveness in the target marketplace.
MAIN BODY
Industry Analysis
This is the method of understand the overall functionality, operations, position of the
company in the specific marketplace. This is the major consideration in which the particular
market is being operated with the effective planning in the given business. Retail industry is the
chosen industry from the UK standard industrial classification(SIC 2007). Moreover, There are
various firms which are making operating in the grocery market and also offer their products and
services by supermarket, online trading and conventional stores. In UK, there are various
companies which are operating their business in the market and this is leading to have the huge
growth and profitability for say i.e., Sainsbury's, Asda which are suffering which is leading to
reduce the entire sale of the company & it is being evaluated and managed by the firm so that
they can sustain in the market in the large market.

Structure of the chosen industry
There are certain which are running in which their business is being operated in the retail
store that are considering the major areas which are centralised, regional and operations business.
Moreover, it is being said that the centralised business operations includes the roles and
responsibilities for the human resource and store planning by which all the operations can be
done in an appropriate manner. This also helps in the better flow of products and services in the
target market with the main consideration they can rightly meet the needs and demand of their
customer who are residential in UK. There are various types of retailer who are operating their
venture in the chain companies and single-store retailer across the globe.
STEEPLE Analysis
It is the framework which leads to analyse the external factors which is impacting the
entire functionality of the business and this detailed information so that they can ensure the better
working of the company. The acronym for STEEPLE analysis stands social, technological,
economical, environmental, political, legal and ethical. In relation to Tesco, there are certain
factors which are given below:

 Social factors: These are the factors which is related to the culture, social, value and the
belief of the individual as change in their precipitation can leads to impact the overall
functionality of the business. In context to Tesco, they can attract the large customer base
as people are shifting towards the organic goods so this will be the advantage of the
company to increase their customer base in the target market. These are the factors that is
completely based on the choices and the eating habit of the consumer so that they can
change their attitude and the mind set of the people for the purchasing power of buying
particular goods and services in the target market.
 Technological factor: Due to change in the market trends, there is the huge change in the
business that is influencing the overall functionality of the business in the concern
marketplace. In consideration to Tesco, they are going to launch Amazon Go which help
in quick billing by which people can ensure easy shopping in the market.
 Economical factor: These are the factors which is reflecting the overall functionality of
the business ad Tesco needs to analyse the impact of of such aspects in an appropriate
manner that are occurring in the marketplace.
Identify the microeconomics factors which affects the demand of products and services
with the demand curve:
Demand is the major concept which is concerned with the desire of the individual in
order to buy the particular goods and services in the target market as the consumer also having
the effective buying capacity to buy particular product.

Following are the determinants of demand which are given below:
 Given price of commodity: It is being stated that the when the given prices of goods
tends to increase then the demand for particular commodities tends to decrease in the
respective marketplace. In consideration to Tesco, when the given prices tends to be low
then the demand for such goods increases in the target marketplace.
 Income of the buyer: There is the positive relationship in the demand and the income of
the consumer. When the income of the consumer increases then the respective demand of
such goods tends to rise in respect to Tesco.
Enlist the determinants of supply and what would cause the supply to fall/rise with the help
of supply curve.
Supply is the concept in which total available amount of goods and services are being
measures which are available for the further sale in the market. In relation to Tesco, There are
certain aspects which are impacting the supply of goods which are given below:

 State of technology: It is the aspect which is related to the huge change in the overall
supply of the commodity. When an organization is using innovative and advanced
technology in their operation by which they can increase their supply in the target market
and ensure more profitability as well. In context to Tesco, Better use of advanced
technology leads to increase the overall supply and Use of obsoleted technology can lead
to decrease the overall supply of product in the UK market.
 Number of firms in the market: It is known that when a same type of company is
operating in the industry with huge number then it leads to need to decrease the overall
supply of the existing firm. As customers are being divided among various organizations
which are being operated in the same industry ring according to their taste and
preferences so the respective demands of goods tends to fall down. In retail industry,
Asda and Morrisons are the leading company which are operating and giving tough
competition to the Tesco.
Discuss the competitiveness of the UK market and its influence on future of the business.
Competitiveness define the entire market scenario that the company will be able to
sustain in the market or not, Whether they have to change their strategy in order to make the
competitive advantage or not. Is these other sorting factors which explain the competitiveness in
the market. According to that threading economics global model, There's been known that U k's
expecting to be the 11th in the end of 2020 Which also held the test code to establish their good
brand image in the target market.
Examples of random shocks that could undermine the UK government fiscal policy and
analyse if there is an monetary and fiscal policy impact the economy of UK.
Random shocks are the situation in which critical problem is being arises and this includes
covid 19, A global pandemic which effect the entire lives of the people around the world. There's
a complete lock-down in different countries and the world is going through a huge critical
problem and continuously fighting against them. This basically impacting the entire economy in
the United Kingdom. According to the government, They have put huge taxation on import and
export which is completely limited to the slowdown in various operations. This is leading to
impact the entire economy to the complete restrictions on driving from one place to another
which may difficult for the paper to survive in an appropriate an easy manner. Taxation has been

framed by the government successfully improvement in the given market so that all the related
companies can en companies can ensure better functioning.
 Environmental factor: It is related to the ecological balance and the sustainability. In
consideration to the test who they are effectively participating for enhancing the overall
environment and woman by which they can ensure sustainable operations. For the blue
care emphasizing on 2 phases that is remove recycled reuse and reduce. This aspect help
them for proper working within the market and the company as well.
 Political factors: These are the consideration which is connected to the stability of the
government and the functioning of an organization. In UK, There is a stable government
which is Helping Tesco company for better functioning by which they can achieve to
their set target. There are various companies which are operating in the tail sector and
then need to follow all the rules and guidelines which is being formulated by being
formulated by the government of UK by which they can rightly comply with the political
strategies or the environment of UK
 Legal factor: It is related to the certain policies which can impact the power over all
functionality of the business and the national International market. In relation to this food
retailing industry commission have framed or laid down some Rules that need to be
followed by an organization the organization was operating in the retaining industry.
 Ethical factors: It basically includes the better communication, respect, honesty and by
this they analyze the overall working of the employees within the organization. When
talking about the Tesco, they are offering better working of employees with the aim of
retaining them within the organization in long run.
Discuss the business problem and challenges which is being faced and criticise on the
external effects of a business decision.
In order analyses a problem with challenges, The Tesco is the public limited company
which is owned and controlled by the government of United Kingdom. They are focuses on
following rules and SOPs so that companies can sustain in the market for long period of time.
They cannot go out of the Box as they have to follow the standard operating processors of the
government

CONCLUSION
It is concluded from the above report that the front types of businesses are operating in
the business environment and movement and ensuring they are better consideration so that a
consideration so that they can generate more revenue and profitability within the organization.
STEEPLE analysis is being conducted In order to understand the impact of external factor on the
business. Demand and supply are the 2 wheels of economics which supply the goods in their
private market.

REFERENCES
Books and Journals
Koleša, I., Burger, A. and Dickmann, M., 2022. The effects of institutions on emerging market
firms’ international assignment location decisions. Economic and Business
Review, 24(1), p.1.
Panda, A. and Gupta, R.K., 2022. Understanding Organizations and Business Ecosystems in
India Using Business Systems Framework. In Indigenous Indian Management (pp. 307-
345). Palgrave Macmillan, Cham.
Liu, X. and Xia, T., 2022. The innovation paradox of political capital in transition economy firm:
Innovation and political capital. Journal of Business Research, 142, pp.775-790.
Alam, Q. and Grose, R., 2022. Shifting sands in the regional business environment in Australia.
In Regional Businesses in a Changing Global Economy: The Australian Experience (pp.
1-10). Routledge.
Wegwu, M.E., 2022. DEFENSIVE STRATEGIES AND FIRM’S RESILIENCE IN A
DYNAMIC BUSINESS ENVIRONMENT. World Bulletin of Social Sciences, 6, pp.41-
50.
Koleša, I., Burger, A. and Dickmann, M., 2022. The effects of institutions on emerging market
firms’ international assignment location decisions. Economic and Business Review, 24(1), p.1.
Online:
Tesco PLC, 2020 [Online] Available through <https://www.tescoplc.com/>