Unit 1: Exploring Business-Assignment 2

Unit 1: Exploring Business-Assignment 2 Unit 1: Exploring Business-Assignment 2 lOMoAR cPSD| Unit 1: Exploring Business- Assignment 2 Learning Aim: C: Explore the environment in which businesses operate D: Examine business markets Assessment Title: The Effects of the Environment on a Business operate C.P4 – Discuss the Internal, External and Competitive Environment on a Given Business. I will research a Public Limited Company; I will examine and address the internal external and competitive environment. I will include a study that discusses these environmental factors in a company and how the company reacts. Tesco PLC Tesco is a PLC Limited Public Company and is the leading brand in the grocery chain supermarket and merchandising. It is in 12 countries such as Ireland and Thailand. The company was founded in 1919. The business grew massively and had over 100 shops throughout the country within the next decade. Tesco currently has a £ 14.3bn market capitalization as of 2019. Tesco PLC is the 26th largest corporation, the 77th largest corporation in terms of its sales and the 632nd largest in the world. External Environment External environment has multiple factors on companies and does have a impact. PESTLE Analysis is used to determine when and why they will succeed • Political: for example. Tax policies, restrictions on trade, tariffs • Economic: for example. Economy, interest rates, economic growth, rate of inflation • Social: for example. Age distribution, language, education, demographic patterns 1 lOMoAR cPSD| • Technological: e.g. Research and development, the advancement of engineering • Legal: e.g. Health and safety, laws, regulations for consumers • Environment: e.g. Recycling, laws, environmental protection, waste Political Tesco has highly influenced political and legislative circumstances set on its Quality in its globalised environment with stores around the world. Tax Plan was introduced by the government in the UK which had an impact on Tesco. The Thailand government increased the VAT from 17.5% to 20%. This increased Tesco’s Cost of sales and affected Tesco a lot. This led to a decrease in revenue and profits for Tesco. UK Government introduces Fat Tax which effected Tesco. The Fat Tax was introduced to lower obesity on certain products. However, Tesco did introduce Healthy Food Section afterwards in the late 2014 Economic Economic factors do have concern to Tesco PLC, as these are to influence the following: Product • Cost Demand for Goods • Employment • Pricing Overall • Profits The economic factors are not in the control of the company and can have unfavorable effects. However, even if Tesco is predicted to grow bigger and bigger in the UK Food market any downturn on the food will have Tesco to be affected by it. Tesco is without a doubt growing significantly. There is an increasing rate of unemployment with economic recession. Due to this, many people have minimum wages or even access to disposable income. Hence why Tesco is offering food at lower price at lower quality which ends up decreasing company's overall profits. The decrease in the workforce is ultimately hurting the profits and lowering the numbers of dividends that shareholders receive.