Unit 5 assignment 2
Introduction:
The external environment affects your business and is made up of many factors. These factors are often
used by businesses to analyze how and why they succeed or fail. Therefore, throughout this report, i will
analyze Tesco, the business of choice, using PESTLE, which represents political, economic, social,
technical, legal and environmental.
Background of the chosen business:
Tesco is a multinational food retailer. Headquartered in the United Kingdom, it has more than 6,000
stores in 12 countries in Europe and Asia. Tesco dates to 1919, when Jack Cohen opened his first store in
Welwyn Garden City, Hertfordshire. It is the second largest retailer in terms of profits and profits after
Wal-Mart. Tesco has grown to provide financial, mobile, insurance, hardware services and more. Use
PESTLE to analyze to better understand this multi-platform international retailer.
Influence of internet: The emergence of internet shopping has been one of the most important shifts in
the retail business. Since then, most shops, including Tesco, have altered their operations to
accommodate this new trend. To meet and respond to this new trend, Tesco has launched an online
click and collect service. The emergence of internet shopping has been one of the most important shifts
in the retail business. Since then, most shops, including Tesco, have altered their operations to
accommodate this new trend. To meet and respond to this new trend, Tesco has launched an online
click and collect service.
International payment methods: There are three international payment methods available for
international transactions: For example, the three main ones are: Advance cash, international credit
card, international bank transfer. Coaching services are when sellers require buyers to pay for the goods
they want before they receive the goods, and in some cases, they pay before the goods are sent. This
means that there is no unpaid money for the products that consumers have purchased, allowing
companies to trade internationally. It also means that businesses do not have to track unpaid money, as
this can be very time-consuming. An international credit card is a credit card that pays internationally via
a tip and pin and can be used almost abroad without charge. Finally, International Bank Transfer gives
you the freedom to transfer money to someone else's account via the banking app or online. This is
usually free and easy to do at any time. PayPal is a good example of what most businesses use as an
online payment method. This is because you can send money in various currencies via PayPal.
Meanwhile, it's also free and accessible 24/7 from all parts of the world where you have access to a
secure WIFI.
Pestle in Uk:
Political: Tesco is a British retailer with operations in multiple countries, such as Ireland, Hungary,
Poland, Slovakia, Malaysia, China, Czech Republic, etc. Tesco's home market is the United Kingdom.
Although Brexit has brought a lot of uncertainty, the political environment is stable. Like the domestic
market, all its overseas markets are politically stable. Therefore, it can be said that Tesco operates in a
political environment that is most conducive to business. Similarly, over the years, Tesco has proven its
ability to respond to current and future legislation and adjust its business and marketing policies
accordingly.
, Economic: As the global economy is severely affected by Covid-19, it is expected that the income of
many people may fall, and many people may lose their jobs. This may cause customers to spend less or
switch to cheaper brands. This may seriously affect Tesco's operations and profits. Similarly, high labor
costs, especially in the UK and Ireland, cost Tesco millions of pounds each year.
Socials: Tesco has taken several initiatives in recent years in response to social change and demands. For
example, due to high demands, he sells branded halal meat to Muslim buyers or has independent meat
counters in some UK stores. Likewise, it sells both branded and private label halal meat in Malaysia and
Thailand (Tesco, 2020). Tesco sells kosher products in the UK under the brand name of Jewish
customers. Like the growing demand for certain types of meat / chicken, the demand for vegetarian and
vegan foods and beverages is also very high in European markets, giving Tesco good opportunities to
grow further.
Technological: Over the years, Tesco has benefited a lot from technological advancement. For example,
it launched "Clubcard" in 1995. This membership card is an important factor behind the company's
success. Millions of people use it in the UK and many other countries where Tesco operates. Similarly,
Tesco’s self-service checkout points provide convenience to customers and help companies reduce
costs.
Legal: Government policies and legislation directly affect Tesco. For example, Davis (2018) reported that
competition laws in the United Kingdom and the European Union prohibit anti-competitive activities, so
Tesco cannot simply merge with another supermarket of comparable size in the United Kingdom or
purchase the supermarket as the country’s competition regulator (Competition and Market
Administration, CMA) can prevent such movements. The wages paid by Tesco to any employee shall not
be lower than the minimum wage set by the government. Likewise, it cannot sell alcohol to underage
customers. It is worth mentioning that Tesco has been prosecuted and fined for misleading customers in
the past.
Environmental: Companies in the UK, EU and, in fact, many countries around the world are facing great
government pressure to tackle environmental problems. This pressure comes not only from the
government, but also from the general public with an interest in the environment. To cope with this
pressure, Tesco has taken many initiatives. For example, it vowed to remove one billion plastic packages
by the end of 2020.
Pestle in China:
Political: China's accession to the WTO has facilitated the free flow of foreign trade by removing all
barriers that have prompted Western companies, including Tesco, to enter the world's most lucrative
market, reaching over 1.3 billion people (Straits Times, 2010). In 2009, Tesco signed an agreement to
create a series of pre-planned joint ventures to develop shopping centers in China. The joint venture
included three shopping malls: Anshan, Fushan and Qinhuangdao. In addition, 18 new hypermarkets are
expected to open in China by 2010 (Tesco, 2009). Tesco's international business segment is growing and
is forecast to account for a quarter of the company's profits. Encouraging governments of free trade
blocs to benefit from globalization has been presented in the literature (Lynch, 2003). An additional 10
countries entered the European Union (EU) in 2004, which facilitated the development of trade
between the countries of Western and Eastern Europe (BBC, 2009).
Introduction:
The external environment affects your business and is made up of many factors. These factors are often
used by businesses to analyze how and why they succeed or fail. Therefore, throughout this report, i will
analyze Tesco, the business of choice, using PESTLE, which represents political, economic, social,
technical, legal and environmental.
Background of the chosen business:
Tesco is a multinational food retailer. Headquartered in the United Kingdom, it has more than 6,000
stores in 12 countries in Europe and Asia. Tesco dates to 1919, when Jack Cohen opened his first store in
Welwyn Garden City, Hertfordshire. It is the second largest retailer in terms of profits and profits after
Wal-Mart. Tesco has grown to provide financial, mobile, insurance, hardware services and more. Use
PESTLE to analyze to better understand this multi-platform international retailer.
Influence of internet: The emergence of internet shopping has been one of the most important shifts in
the retail business. Since then, most shops, including Tesco, have altered their operations to
accommodate this new trend. To meet and respond to this new trend, Tesco has launched an online
click and collect service. The emergence of internet shopping has been one of the most important shifts
in the retail business. Since then, most shops, including Tesco, have altered their operations to
accommodate this new trend. To meet and respond to this new trend, Tesco has launched an online
click and collect service.
International payment methods: There are three international payment methods available for
international transactions: For example, the three main ones are: Advance cash, international credit
card, international bank transfer. Coaching services are when sellers require buyers to pay for the goods
they want before they receive the goods, and in some cases, they pay before the goods are sent. This
means that there is no unpaid money for the products that consumers have purchased, allowing
companies to trade internationally. It also means that businesses do not have to track unpaid money, as
this can be very time-consuming. An international credit card is a credit card that pays internationally via
a tip and pin and can be used almost abroad without charge. Finally, International Bank Transfer gives
you the freedom to transfer money to someone else's account via the banking app or online. This is
usually free and easy to do at any time. PayPal is a good example of what most businesses use as an
online payment method. This is because you can send money in various currencies via PayPal.
Meanwhile, it's also free and accessible 24/7 from all parts of the world where you have access to a
secure WIFI.
Pestle in Uk:
Political: Tesco is a British retailer with operations in multiple countries, such as Ireland, Hungary,
Poland, Slovakia, Malaysia, China, Czech Republic, etc. Tesco's home market is the United Kingdom.
Although Brexit has brought a lot of uncertainty, the political environment is stable. Like the domestic
market, all its overseas markets are politically stable. Therefore, it can be said that Tesco operates in a
political environment that is most conducive to business. Similarly, over the years, Tesco has proven its
ability to respond to current and future legislation and adjust its business and marketing policies
accordingly.
, Economic: As the global economy is severely affected by Covid-19, it is expected that the income of
many people may fall, and many people may lose their jobs. This may cause customers to spend less or
switch to cheaper brands. This may seriously affect Tesco's operations and profits. Similarly, high labor
costs, especially in the UK and Ireland, cost Tesco millions of pounds each year.
Socials: Tesco has taken several initiatives in recent years in response to social change and demands. For
example, due to high demands, he sells branded halal meat to Muslim buyers or has independent meat
counters in some UK stores. Likewise, it sells both branded and private label halal meat in Malaysia and
Thailand (Tesco, 2020). Tesco sells kosher products in the UK under the brand name of Jewish
customers. Like the growing demand for certain types of meat / chicken, the demand for vegetarian and
vegan foods and beverages is also very high in European markets, giving Tesco good opportunities to
grow further.
Technological: Over the years, Tesco has benefited a lot from technological advancement. For example,
it launched "Clubcard" in 1995. This membership card is an important factor behind the company's
success. Millions of people use it in the UK and many other countries where Tesco operates. Similarly,
Tesco’s self-service checkout points provide convenience to customers and help companies reduce
costs.
Legal: Government policies and legislation directly affect Tesco. For example, Davis (2018) reported that
competition laws in the United Kingdom and the European Union prohibit anti-competitive activities, so
Tesco cannot simply merge with another supermarket of comparable size in the United Kingdom or
purchase the supermarket as the country’s competition regulator (Competition and Market
Administration, CMA) can prevent such movements. The wages paid by Tesco to any employee shall not
be lower than the minimum wage set by the government. Likewise, it cannot sell alcohol to underage
customers. It is worth mentioning that Tesco has been prosecuted and fined for misleading customers in
the past.
Environmental: Companies in the UK, EU and, in fact, many countries around the world are facing great
government pressure to tackle environmental problems. This pressure comes not only from the
government, but also from the general public with an interest in the environment. To cope with this
pressure, Tesco has taken many initiatives. For example, it vowed to remove one billion plastic packages
by the end of 2020.
Pestle in China:
Political: China's accession to the WTO has facilitated the free flow of foreign trade by removing all
barriers that have prompted Western companies, including Tesco, to enter the world's most lucrative
market, reaching over 1.3 billion people (Straits Times, 2010). In 2009, Tesco signed an agreement to
create a series of pre-planned joint ventures to develop shopping centers in China. The joint venture
included three shopping malls: Anshan, Fushan and Qinhuangdao. In addition, 18 new hypermarkets are
expected to open in China by 2010 (Tesco, 2009). Tesco's international business segment is growing and
is forecast to account for a quarter of the company's profits. Encouraging governments of free trade
blocs to benefit from globalization has been presented in the literature (Lynch, 2003). An additional 10
countries entered the European Union (EU) in 2004, which facilitated the development of trade
between the countries of Western and Eastern Europe (BBC, 2009).
