PESTLE Analysis: Pestle Analysis On Tesco

Their goods have to be of a high quality (depending on price) for customer demand to continue or increase and for customer loyalty. If quality drops that will have to be reflected by the price, if not then the Tesco may have to consider getting new suppliers, this means loss of income for the current supplier and job uncertainty.

Tesco's has recently had to make many changes in their staff and have had to change the management structure to be able to pay every manager fairly and pay the wages for their general employees. These effects were taken place due to a major profit change and an unstable financial system. Another effect that has been changed is the Tesco pension scheme back in 2012. The Tesco pension scheme had changed due to financial problems however this would mean employees who have a pension scheme with Tesco will have to work longer if they were in their early 60's . This became a challenge for Tesco's as they couldn't afford to pay out on pension schemes at that precise moment.

Tesco Plc is a Public Limited Company who securities and shares are included in the stock exchange and list of different countries. In UK, companies like Tesco Plc are registered under the companies Act 1980 and its shared are offered to public in regards of limited liability. In addition, Tesco is associated with retail sector that carries out a majority business of the company and contribute their share in country’s economy to a huge scale. Apart from the retail sector, Tesco Plc faced tough competition all over the world from companies like Wal-Mart, Asda, Sainsbury, and others. Although, Tesco is not in dominating position in the current retail market in the UK, but the company is one of the biggest retail companies working in the UK, North America, Asia, Europe and other. The company

Trader Joe's faces several threats to its business, as competitors try to invade the company’s niche and attempt to imitate the company’s core strategies. The supermarket industry itself faces a major threat, as larger chains such as grocery retailers Wal-Mart and Tesco have begun to open small-format stores that mimic the Trader Joe's approach. This invasion results in additional cost pressure for incumbents like Trader Joe’s, which had to let go employees in order to become more cost competitive.

Tesco’s might expand their brand into different retailers so it’ll gain more popularity and might even be a leading bran in food clothes etc

The General Election would affect Tesco as if Labour gets in charge Corporation tax, VAT and minimum wage would probably increase. This would cause Tesco to be in a negative

Tesco is very fortunate as there are few other large supermarket companies. This means that the food retail market is quite disciplined as the supermarkets have a set approach to price setting. Discipline stops them destroying each other in a profit war.

The UK supermarket industry is a very competitive and profitable industry. It is made up of four main players with significant share of the market, and then various smaller companies who focus on smaller niches in the market such as the bottom of the market discounters and the top of the line speciality stores. It is an interesting market and this report evaluates the attractiveness of the industry using Porter’s five forces model with an insight into how market nicher Waitrose sustains a competitive advantage. Next this report looks at how major player Sainsbury’s successfully competes against its rivals using differentiation strategies, and analyses current consumer trends and problems can effect this industry.

In 2012 the government decided to raise the minimum wage and change the vat rules this had a massive effect on marks and spencer’s as a company. The government raised the minimum wage to £6.18 an hour, This had a bad effect on marks and spencer because all the people at marks and spencer that were on the smaller minimum wage £6.08 (off which It was estimated that nearly half of their work force were on) this lead to an

Bargaining Power of Customers: Tesco frequently consults their suppliers and discuss pricing arrangements. Tesco also ensures that all aspects of their supply chain benefit from their relations with Tesco.

Tesco operates in 14 different countries. Therefore its performance may be influenced by the local legislation and political factors. There are

By 2050 Tesco aim to be a zero carbon organisation. This has come after there has been heightened pressure for organisations to take notice of environmental issues. They hope to

Recession causes unemployment, this will affect the demand for goods and Tesco profit will drop.

Tesco can be said to be a global leader in the UK retail business. It is one of the leading world retailers. The company started using the trading name TESCO in the 1920s and since the group has expanded in many ways venturing in different markets and with interest in different sectors. Over the years, Tesco has recorded growth which has been achieved through different strategies. There has been emphasis on the growth of Core UK business in order to expand internationally. This growth has allowed the company to position itself in food and non-food sectors based on retailing services. Over the years, the company has witnessed financial fortunes which have been reflected in its growing sales. Sales have risen from 31,726,280 from 2013 to 32,074,650 in 2014 (Kantar, 2014.) This has been achieved through growth strategies which have seen the company expand its retail outlets and at the same time enter into new markets with high growth potential using their famous ‘every little helps’ branding along the way. The ‘Every little helps’ branding helped Tesco’s attract 1.3 million new customers in the period from 1990-1995, and the campaign achieved good effects on staff morale, attracting quality marketers to join Tesco, directly affected the share price and allowed the brand to move into non-grocery sectors where brand credibility is a key requirement. Disadvantages….limitations etc

Profits for Tesco’s operations in Europe, Asia and Ireland increased by 78% during the last fiscal year. The company has a strong brand image, and is associated with good quality, trustworthy goods that represent excellent value. Tesco’s innovative ways of improving the customer shopping experience, as well as its efforts to branch out into finance and insurance have also capitalized on this.