Business Environment And Economic Factors That Affect The Business And They

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To: Mrs Shields From: Matthew Nelson Subject: Task 4 Date: 11/01/16 Introduction So far I have learned about the business environment and some of the economic factors that could affect the business and they include: • Inflation • Economic Growth • Exchange Rates • Balance of Payments • Unemployment Unemployment Unemployment can occur in jobs because of frictional, structural, cyclical, technological and seasonal problems. Unemployment could be short or long term depending on the job because if you were working at a theme park the summer time will have more people employed because the theme park will be shut in the winter and there will be no employment but if you work at Tesco and you lose your job it could be because of…show more content…
In the previous four years all of Tesco’s profits have turned into huge losses. In 2014 the shares fell below 30% the worse fall Tesco’s have seen in 8 years and Tesco’s share price is still down by more than 20%. The UK’s Supermarkets market share This chart is showing me that from 1 Jan 1994 to 1 Jan 2006 the market share for Tesco’s has increased massively and since all the problems started at Tesco it has started to decrease. The Supermarket that has been mostly affected is Co-operative and from 1 Jan 1994 to 1 Jan 2014 it has decreased massively. Inflation What is inflation? Inflation is “a general increase in prices and fall in the purchasing value of money” and inflation happens because the economy might be struggling. As inflation raises the amount of money you own becomes less because with the price raising your value of money is decreasing. Inflation at Tesco The effect of inflation at Tesco in the last couple of years has rose 1.1 per cent in 3 months from March to May 2010 and Tesco said “adjusting for this year 's higher rate of VAT sales, crawled just 0.1 per cent higher” which in my opinion is good for the supermarket but it’s not much inflation because some shops the inflation hits them badly and causes some to shut down because the prices maybe too high for people to afford so they will lose business. In Tesco’s the inflation might of rose over the last few years because they lost a lot of customers because of the horse meat
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