Unit 1, Assignment 2 .
This assignment will include the external factors which affect a business, the internal
environment (corporate culture, and corporate social responsibility), competitive advantages
and the factors which influence it. It will include influence on the business’s supply, demand
and price, the market structures the business operates in, and their impact on output and
pricing decisions, and the selected business’s response to these impacts.
I will use Tesco for the entirety of this assignment.
P4 + P5
Int., Ext., Competitive Environment .
The political environment affects Tesco as the government encourages them to employ as
many people as possible. Their reason being, the more workers they have employed, the
more money the government makes. Another way the political factor affects Tesco is due to
tax rates. This affects them when the government raises them, it forces Tesco to give a
larger percentage of sale revenue to the government, harming their profit.
The economic factor affects Tesco due to costs of employment. The UK minimum wage is
rising every so often (4.4% in 2018), and this affects them as it makes them have to increase
their prices on products and services. This can negatively contribute to a loss of customers,
as some may not want to pay the increased prices. Inflation rates are to additionally affect
Tesco. World events tend to have major control over inflation. The war in Ukraine and the
COVID-19 pandemic brutally affect it as a result of economic sanctions.
The social environment affects Tesco because of the current trends of their customers. They
have recognised that they have been more interested in both bulk and one-trip shopping.
They responded by increase the quantity of how many non-food products they have on offer.
Tesco is always changing their ways and approaches towards food as customers are
expanding their knowledge on health issues and conditions they have. Tesco began
adapting to the demand of organic products. They also have to sell food aligned with their
customer’s tastes and preferences.
The technological aspect has an effect on Tesco on its day-to-day actions. This is shown
through how it sells its products and services to its customers. They do this through
customer service employees working on the tills, serving each customer. Without a conveyer
belt, service would take longer, especially without a till to calculate what the customer is to
pay. Tesco also has a self-service system, where customers can pay for their things without
interaction from employees. They are dependent on the internet for customers to request
deliveries, and to answer queries, and give online reviews. They additionally have a payment
system named PayQwid. Customers using this can pay for shopping and get loyalty points
when it’s linked to their clubcard.
The legal side affects Tesco as they have to follow many laws, legislations and regulations.
One of these legislations is the Equality Act 2010. Summed up, Tesco and their workers,
managers, directors, etc. are unable to discriminate against age, sex (and orientation), race,
religion, pregnancy and a couple others. Another is the Consumer Protection Act 1987. In a
summary, if a producer sells a faulty product which causes property or bodily harm or a
fatality, they can be prosecuted, receiving a possible fine and a prison sentence up to six
months.
This assignment will include the external factors which affect a business, the internal
environment (corporate culture, and corporate social responsibility), competitive advantages
and the factors which influence it. It will include influence on the business’s supply, demand
and price, the market structures the business operates in, and their impact on output and
pricing decisions, and the selected business’s response to these impacts.
I will use Tesco for the entirety of this assignment.
P4 + P5
Int., Ext., Competitive Environment .
The political environment affects Tesco as the government encourages them to employ as
many people as possible. Their reason being, the more workers they have employed, the
more money the government makes. Another way the political factor affects Tesco is due to
tax rates. This affects them when the government raises them, it forces Tesco to give a
larger percentage of sale revenue to the government, harming their profit.
The economic factor affects Tesco due to costs of employment. The UK minimum wage is
rising every so often (4.4% in 2018), and this affects them as it makes them have to increase
their prices on products and services. This can negatively contribute to a loss of customers,
as some may not want to pay the increased prices. Inflation rates are to additionally affect
Tesco. World events tend to have major control over inflation. The war in Ukraine and the
COVID-19 pandemic brutally affect it as a result of economic sanctions.
The social environment affects Tesco because of the current trends of their customers. They
have recognised that they have been more interested in both bulk and one-trip shopping.
They responded by increase the quantity of how many non-food products they have on offer.
Tesco is always changing their ways and approaches towards food as customers are
expanding their knowledge on health issues and conditions they have. Tesco began
adapting to the demand of organic products. They also have to sell food aligned with their
customer’s tastes and preferences.
The technological aspect has an effect on Tesco on its day-to-day actions. This is shown
through how it sells its products and services to its customers. They do this through
customer service employees working on the tills, serving each customer. Without a conveyer
belt, service would take longer, especially without a till to calculate what the customer is to
pay. Tesco also has a self-service system, where customers can pay for their things without
interaction from employees. They are dependent on the internet for customers to request
deliveries, and to answer queries, and give online reviews. They additionally have a payment
system named PayQwid. Customers using this can pay for shopping and get loyalty points
when it’s linked to their clubcard.
The legal side affects Tesco as they have to follow many laws, legislations and regulations.
One of these legislations is the Equality Act 2010. Summed up, Tesco and their workers,
managers, directors, etc. are unable to discriminate against age, sex (and orientation), race,
religion, pregnancy and a couple others. Another is the Consumer Protection Act 1987. In a
summary, if a producer sells a faulty product which causes property or bodily harm or a
fatality, they can be prosecuted, receiving a possible fine and a prison sentence up to six
months.
