Free Essay

Tescos Legal, Political and Social Factors

In: Business and Management

Submitted By sushanthan
Words 1655
Pages 7
Political, Legal and Social Factors

Task P6: Describe how political, legal and social factors are impacting upon the business activities of the selected organisations and their stakeholders

Each businesses have different factors which will influence how that will impact the business activities. Tesco for example have a lot of factors which they need to consider so they can have a successful business, these factors are:
Political factors
Legal factors
Social
The political factors are the factors that is related to the governments policy which can have an effect on their business. Most businesses keep an eye on any political factors such as any new legislations which have been introduced or any old legislations which could have been changed. With an organisation such as Tesco there will be many factors that may affect them.
The Political factors could include any government support, provide additional enhancing skills such as training days or introduction days for new employees. The main factor could be government support as this can help the organisations with extra funding or any with any other additional help such as the fiscal policy which will help tesco with their loans. Loans will be offered to Tesco if they are having financial problems or are struggling to pay the money for any new products or any better products. For example,during the recession Tesco might not be doing as well as they forecasted to do so, which could mean they might not be able to spend much money on new items which would increase the amount of profit they make.
This could mean that Tesco might need to take a loan and pay it later with interest, so for example if Tesco has taken a loan from the government which was £1000 and the interest rate was 5%, Tesco would have to pay the government back with £1150 as the £150 comes from the interest. However Tesco don't normally take loans out because they are never short of money as they are such a big global organisation and they can use their own profit and shares to complete any extra cost, if Tesco needs to cut down on costs they will look at alternative to how they can cut down cost, they can do this by changing their supplier to a cheaper one who uses cheaper natural resources or change a supplier who tesco can give the money back later, they could even cut down on costs by limiting the number of employees so they have fewer employees to pay for.
Likewise you can also get Grants. Grants are funds that are by one party often by a trust (e.g. princess trust) or government department. Grants influence Tesco's activities because it sets certain objectives within a local and international scale for example objectives are :
On a local level, to support the needs of employees, customers and communities around our stores;
On an international level, to help our business and supply chain to make a difference in their locations.
The other side of government support is indirect support which is all about fiscal policy , taxes, vat and corporation tax. VAT stands for Value Added Tax. Whatever we buy within Tesco's we will have to pay some VAT no matter what it is we buy. Fiscal's policy is all about taxation to influence the economy. Changes in the level of taxation and government spending can the various impacts on Tesco.
The level of taxation changing means that Tesco also have to pay tax. They have to pay this to the government so that the government could provide services for the general public. This would be different if Tesco's was funded by the government because then they wouldn't have to pay tax.
In addition they focus on improving the skills of the employees which includes training schemes and education, which adds further cost. Tesco's may have training days to help support the staff to widen the skills they use in Tesco's. They may have to pay to send the staff on these training days but in the long term it could increase the amount of money they make because they will be more productive and be more skillful than before.
Another factor would be provide which is infrastructure and the links they have with the internet. This could include online shopping. Tesco's have their own online shopping on the internet for people who prefer to use the internet to get their shopping from online. Once the order has been placed Tesco's then deliver the food or products the next day. This also helps people who may not be able to make it to the stores itself like customers who are very busy with work and even the disabled people so again it opens a new customer base which means they again will make more money. Tesco are always influenced by customers and aim to operate around their needs.
Another factor which influences Tesco are the legal factors. The Legal factors could affect Tesco's activities may be company/contract law. Each of which may protect employees and consumers. There must be written evidence within the contract that the employee signs to say that the employer will make sure that any details given to them will be secured and shared with no one else. Confidentiality is not the only thing that must be included within the contract. The number of hours that the employees work and the working conditions are also included within this so the employee knows what to expect from Tesco's and Tesco's know what to expect from the employee. This type of contract has to be signed both by the employer and the employee to make sure they both agree to the terms and conditions.
There is such thing called consumer protection which falls under the sales and goods act 1994. This is basically an act of parliament which relates to 'goods' been sold and bought. It includes conditions like if the price is not agreed the consumer needs to pay a reasonable price. Another thing that might affect Tesco's activities might be the national minimum wage act 1998. This basically sets the minimum wage the employees can work for. This can also influence how many employees are taken on by Tesco because it influences how much money they can pay out to employees a year when they work. This will also be included in the contract of employment. Another Act that could affect Tesco's activities would be the health and safety & work act 1974. This again will be involved within the employment contract which states the working environment that the employees will be working in within their working days. This is to ensure the safety of the employees and customers. If someone was to get injured at Tesco's they could be eligible to be sued because it is Tesco's responsibility to make sure that everyone is safe within the environment. It may also include : maintaining a working environment which is safe and without risk to health and providing equipment and systems of work which as far as possible are safe without risk to health.
Last but not least, the third factor which could influence Tesco’s are social factors. This could include ages, Gender, education & skills, Religion, household income and attitude to male and female workers.
Over the past few years the birth rate has increased so they may start to look at selling childrens toys or products to open a new market which will eventually create more profit or make a lot more money because they'll have an extra market that parents and children are interested in. They will also focus on education as seen on adverts they already sell school uniform for children that are a certain age which is mostly primary school. They will also sell school equipment for all ages from primary to secondary and even to college. This opens a whole new market. However it might not be this market they completely focus on. It can also focus on death rates. Tesco's itself have a funeral service that is open to any family that wish to organise a funeral for a loved one. The higher the death rate goes the more money Tesco's will most likely make if families choose Tesco's funeral service.
Gender also has a huge influence on Tesco's stores because they can have different sections for different genders which means there will be something for everyone within the Tesco's stores. However Tesco is a global company which means genders from all around the world as well as all ages will be visiting Tesco to get what they want.
Within their stores they provide equal rights which means both men and women can work there. Tesco's can not turn someone away from work just because they are male/female, black/white and disabled/able to complete the job. This links to legal factors because it is within the contract of employment that equal rights are top priority. Tesco needs to respect both male/female workers simply because the store themselves sell both male and female products so they do need to employ both males and females.
Religion could also affect Tesco's activities. There was an incident that involved the religion of "jedi" when a jedi church founder was thrown out of Tesco's for refusing to remove his hood. This obviously caused the man humiliation and Tesco's received some criticism. It is therefore Tesco's task to make sure they do not discriminate different races and religion. Because Tesco's is a global company they have to take into account that a range of people will be visiting their stores and wanting to buy products. It could also affect Tesco's activities because they may want to open up new products for different religions which again opens up new markets completely and it does not single people out. Again this in the long run will help create more money for Tesco.

Similar Documents

Premium Essay

Political and Legal Environment - China

...POLITICAL AND LEGAL ENVIRONMENT Government Overall Since 1949, the People's Republic of China was established in the country by the communists who still govern it today by the Communist Party of China (PCC), whose monopoly on power is guaranteed by the Chinese constitution. The current president is Hu Jintao and Wen Jiabao is the prime minister. There are other political parties in the country, though mainly serve to endorse the policies adopted by the PCC. There are signs of political opening, with competitive elections in village and town levels, but these are slim. The Communist Party still maintains effective control over government nominations. Although the Constitution contains rights and individual guarantees, the People's Republic of China is considered one of the least free countries in terms of press freedom and censorship is common for expression of views and information related to the government. China is often criticized by NGOs and other governments due to serious violations of human rights, as in the case of arrests of political activists without trial, forced confessions, torture, mistreatment of prisoners and others. China was then characterized as a country governed by laws and authoritarian policies, communists and socialists. Censorship of political speech and information, including the Internet, is openly and routinely used to silence criticism of the government and the Chinese Communist Party. The government represses the demonstrations from......

Words: 805 - Pages: 4

Premium Essay

Political, Legal and Social Factors Have an Impact on Business

...Political, Legal and Social Factors Have an Impact on Business Political Factors: Political Stability: This is where a general election happens across the nation and one party is elected to run in government and last up to 5 years they are Liberal democrats, labour or conservatives. Each party produce a manifesto to say what they would like to change when they are in power if they get voted in. This help organisation such as Merthyr Tydfil Borough Council and JLR plan for the future with the change that may be made for example if they plan to cut government spending, then JLR and Merthyr Tydfil Borough Council need to find alternative method to fund the expansion of JLR. Or for Merthyr Tydfil Borough Council if cuts are being made they may not be able to make certain changes may not be able to make them originally. Taxation: These are taxes which are controlled by the national government Labour, Liberal Democrats or Conservatives a good example of this would be income taxes. Local government would be business rates. Taxes are useful for the government as it help them create revenue so they can spend it on the NHS and School for example. If taxes were decrease it would have impact on all organisation, such as Merthyr Tydfil Borough Council would be that as people are putting less into them they are not going to be able to fund certain projected that they planned to do when taxes were high. The impact it would have on JLR would be that, as taxes are doing,......

Words: 2895 - Pages: 12

Premium Essay

Tesco Macro Environmental Factors

...Macro Environmental effects on TESCO Marketing Decision Making As macro environmental factors always effect the development and planning of every business, same as Tesco also has or will have some influences of macro environmental factors towards its marketing decision-making. Socio Culture Environmental Factors Demographic Changes Demographics are the study of the measurable aspects of population structure and profiles, including factors such as age, size, race, occupation and location. As the birth rate fluctuates, and as life expectancy increase, the breakdown of the population changes, creating challenges and opportunities for marketers. Tesco use the demographic changes as opportunity and set its marketing strategy by the running the different kinds of store depending on the population size, location etc. Tesco use ethnic groups as a tool for good opportunities. Tesco divided its stores across the UK into five formats, these stores differentiating with the size of store and product being sold in these stores, TESCO EXTRA is largest store, generally located out the town a wide area. All Tesco products range available here. Free Car Parking also provided here. In 1997 first Tesco Extra was opened. TESCO SUPERSTORES are considered as supermarkets with standard large size. These stores have the stock of grocery and a lot of small non food small items. These store called the superstore for connivance but this word does not use in the shops. Generally these stores open......

Words: 2153 - Pages: 9

Premium Essay

The Political and Legal Environments Facing Business

...CHAPTER THREE THE POLITICAL AND LEGAL ENVIRONMENTS FACING BUSINESS OBJECTIVES • To discuss the different goals and functions of political systems • To profile trends in the emergence and diffusion of political systems • To identify the idea of political risk and approaches to managing it • To understand how different political and legal systems affect the conduct of business • To profile trends in the evolution and diffusion of legal systems • To examine the major legal issues facing international business companies • To profile the idea of intellectual property and the basis of concern and controversy Chapter Overview When firms source, produce, and/or market products in foreign countries, they encounter dynamic and challenging political and legal environments. Chapter Three provides a conceptual foundation for the examination of the political and legal dimensions of international business operations. It compares major political regimes, discusses their potential influence upon the development of effective business strategies, and considers the relevance of political risk. The chapter also examines the major types of legal systems that exist today, as well as the strategic and operational concerns they pose. It concludes with a discussion of intellectual property rights and the associated challenges confronted in an age of globalization. Chapter Outline OPENING CASE: CHINA’S BUSINESS ENVIRONMENT [See Map 3.1.] During its thirty......

Words: 2792 - Pages: 12

Free Essay

Describe How Political, Legal and Social Factors Are Impacting Upon the Business Activities of the Selected Organisation and Their Stakeholders

...Level 3 Unit 1-P6 Describe how political, legal and social factors are impacting upon the business activities of the selected organisation and their stakeholders Political impacts Political stability is usually defined as the state of peace that is normal experienced in a country from the activities from the government and also the government in this situation will make decisions and keeping the best interests in mind for people. The conservative party that is normally referred as the Tory party and is a centre – right political party in the UK and as of 2013 it has become the largest political party in the UK and also the largest single party in the house of commons with 303 MP’s. Got initiatives: is when the Government can support business through grants and tax reductions and an example of this is the solar panels grant. Also when the government chooses to Investment finance this then involves selling part of your business (‘shares’) to an investor. The investor will then take a share of any profits or losses that the company makes. The International Monetary Fund describes itself as “an organization of 188 countries that works to foster global monetary cooperation, to then secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduces poverty around the world. The Government may change the tax rates up or down this will be to try help boost the economy, an example of this is VAT this means all non......

Words: 863 - Pages: 4

Premium Essay

Show Macro and Micro Environmental Factors Which Influence Marketing Decisions at Tesco

...where you walk into to purchase, to the shops where you can explore with a keyboard and mouse. As per Department of T rade and Industry’s commissioned report in 2003, £221bn topped in the UK after retail sales, and also provides jobs to around three million people and contributed 12% in the whole UK economy . We society is consumer-driven society , where shopping represents a lot more a hobby than an actual requirement to purchase products. ABOUT TESCO T esco, among the globe’s leading multinational retailers and a top retail store chain in the UK. In 1919 T esco was founded by Jack Cohen, at that time Cohen started to sell extra grocery items from a stall in the East End of London. Against his first day’s £4 sale he gained £1 profit. The T esco brand first time appeared in 1924. The brand `TESCO`, came about after Jack Cohen purchased shipment of tea from the supplier T .E. Stockwell. He made new labels by using the first three letters of the supplier's name (TES) and (CO) from his sir name forming the name "TESCO”. The first brand which was sold by the T esco was “T esco T ea” in 1924. The first T esco store was started in 1929 at Burnt Oak, Edgware London. In 1932 T esco became a private limited company . T esco was registered in the London Stock Exchange as T esco Stores Limited in 1947 and the price of the share of T esco Store Limited was 25p. In 1956 in Maldon, a cinema was converted into the first T esco self services superstore. In year 2000 T......

Words: 1474 - Pages: 6

Free Essay

P6 How Does Political, Legal and Social Factors Impact Business Activities of Selected Organisations and Their Stakeholders

...P6 How does political, legal and social factors impact business activities of selected organisations and their stakeholders Political factors: Politics can Nike.in both negatively and positively through changes made to tax, labor and national security laws. For example, politicians can raise taxes directly on businesses or on individuals, which ends up costing the company in the long run as people spend less money on goods and services. Alternatively, Nike profit when citizens receive tax incentives. Legal Factors: Businesses can be affected by many aspects of government policy. In particular, all businesses must comply with the law. They must also consider the impact of any forthcoming legislation on their operations. This may require taking action before the legislation comes into effect. One issue that affects manufacturers and retailers of electronic goods is the disposal of these products at the end of their life. Recycling is high on the public agenda. There are government initiatives to promote more recycling. These initiatives are sometimes backed by legislation. For example, the Waste Electrical and Electronic Equipment (WEEE) regulations are designed to reduce the amount of electronic waste going to landfill sites. Businesses must obey these environmental laws. However, a company that goes further by taking other measures to minimize its environmental impact will be seen more favorably by consumers. Another is how they’re manufactured; trade unions and......

Words: 487 - Pages: 2

Free Essay

P6- Describe How Political, Legal and Social Factors Are Impacting Upon the Business Activities of the Selected Organisation and Their Stake Holders

...Political Impacts Political stability is usually defined as the state of peace that is normally experienced in a country from the activities from the government and also the government in this situation will make decisions and keeping best interests in mind for people. Government initiatives are when the government can support business through grants and tax reductions. The government have their own initiatives for companies like Asda and these are the health eating and fit for life. These are campaigns that Asda will try to support then try to receive more funding from the government for advertising etc. Also when the government chooses investment finance this then involves selling part of your business shares to an investor. The investor will then take a share of any profits or losses Asda make. The government may change the tax rates up or down in an effort to try an boost the economy. An example of this is VAT which means all non-food will need their labels changing which could potentially increase profitability. `The international monetary fund describes itself as ‘an organisation of 188 countries that works to foster global monetary cooperation. It also works to secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world. Legal Impacts The legal impacts are that Asda must follow the law. The legal frameworks is where the business chooses the way it operates.......

Words: 772 - Pages: 4

Premium Essay

Social Factors

...Chapter 01: INTRODUCTION AND PROBLEM STATEMENT 1. INTRODUCTION This chapter will focus on the problem statement, research questions, objectives of the study, the research design and chapter summary. 2. PROBLEM STATEMENT Higher education institutions have no worth without students. Wenger (1999) stated that academic differences are the social changes that students encounter at higher education institutions. The author further mentioned that students live on their own for the first time, away from friends, family or other familiar support networks, it is during this time that as students a result, when students begin tertiary study, they they enter not just one but oftenon several new, and potentially contrasting communities within the higher education institutions. Students are the most essential assets for any educational institute (Mushtag & Khan, 2012). They enrol at a higher education institution with the objective of obtaining registered qualifications and successfully complete this qualification. Academic success is the objective at which all hHigher education institutions need to address should address (Samaniego-sanchez, Gonzales, Aparicio, Nebot, Aranda, Lopez-jurado and Llopis, 2011). Every Higher education institution envisage to should deliver good educationquality education for every student who enrols with the institution in order to in......

Words: 7705 - Pages: 31

Free Essay

Describe How Political, Legal and Social Factors Impact on 2 Organisations and Their Stakeholders P6 Including M3

...P6M3 How does political, legal and social factors impact business activities of selected organisations and their stakeholders Nike Political factors: Politics can Nike.in both negatively and positively through changes made to tax, labor and national security laws. For example, politicians can raise taxes directly on businesses or on individuals, which ends up costing the company in the long run as people spend less money on goods and services. Alternatively, Nike profit when citizens receive tax incentives. Nike would respond accordingly to the games of politics. From increasing interest rates to adjusting their demographic models. Legal Factors: Businesses can be affected by many aspects of government policy. In particular, all businesses must comply with the law. They must also consider the impact of any forthcoming legislation on their operations. This may require taking action before the legislation comes into effect. One issue that affects manufacturers and retailers of electronic goods is the disposal of these products at the end of their life. Recycling is high on the public agenda. There are government initiatives to promote more recycling. These initiatives are sometimes backed by legislation. For example, the Waste Electrical and Electronic Equipment (WEEE) regulations are designed to reduce the amount of electronic waste going to landfill sites. Businesses must obey these environmental laws. However, a company that goes further by taking other measures to......

Words: 1020 - Pages: 5

Premium Essay

Describe How Political, Legal and Social Factors Are Impacting Upon the Business Activities of the Selected Organisations and Their Stakeholders

...P6 - Describe how political, legal and social factors are impacting upon the business activities of the selected organisations and their stakeholders All businesses and corporations will face external factors that impact the business activities and stakeholders of a business. These factors of changes can be political, legal, and social within the business environment. Politics is a process by which groups of people make collective decisions. These decisions can affect businesses as well as the working economy. For example, a new legislation or a regulatory change of policies from the government will affect business activities. Social factors relate to changes in the behaviour, tastes and lifestyles of communities on a local, national and international scale. In a business, it is important for the marketing department to take account of the various social characteristics of the consumer groups for their target market. Legal factors relate to the laws, regulations and legislations which affect the way a business functions. For example, common law for business balance prohibits paying a little and getting a lot. I will describe how political, social factors impact upon Tesco and Bank of China. Political factors of Tesco Tesco have political factors that affect their business activities. For example, political stability for the national economy in this case the government such as the government make decisions in the best interests of the people and should support businesses....

Words: 1839 - Pages: 8

Premium Essay

Legal, Political and Ethical Environment

...Legal, Political and Ethical Environment: Dimensions of business environments are often classified in 6 major groups represents by the acronym PESTEL. These are: 1. Political 2. Economic 3. Socio cultural 4. Technological 5. Environmental 6. Legal Political environment includes factors like the nature of government policies particularly those related to taxation, industrial relations, regulation of internal business and industry, and foreign trade regulations. It also relates to the stability of the government in power and risk of major political disturbances. Economic factors, as the name implies related to the general condition of the economy within which a business operates and conducts business. It will include factors like GNP, economic growth rate, interest rates, inflation rate, moneys supply, and unemployment rates. Socio cultural factor cover the nature of the life style, culture, attitude and other such common factors that influence and describe the behavioral characteristics typical of the people. It will include factors like demographic profile of the people, culture, and life style. Technological dimension covers the nature of technology available and used by an economy or industry in general. It also covers the extent to which development in technologies are likely to take place. This may be reflected in factors like expenditure on R&D and rate of obsolescence. Environmental factor refers to the physical or geographical environment......

Words: 268 - Pages: 2

Premium Essay

The Impact of Political, Legal and Social Factors on Two Businesses

...The Impact of Political, Legal and Social Factors on Two Businesses All businesses in the world have to obey to the political, social and legal factors that are within the world. These factors can have both a negative and positive effect on the business. The businesses I will be concentrating on is Toys ‘R’ Us and National Health Service. Toys ‘R’ Us Political Factors Political factors that affect businesses include new legislation such as the national minimum wage and setting tax rates such as VAT or Corporation Tax. Most business operators will keep a watchful eye on any political factor, such as new laws or regulatory shifts, which could have a substantial impact on how their company operates. Politics can affect a business in many different ways. For example grants, taxation and support. All these can change the outcomes of the business. They can affect profit, customers and revenues. Taxation can affect every business in the world including Toys ‘R’ Us. Taxes are collected by national government and local government. Taxation helps the government ti raise revenue and also enables it to discourage various activities and to encourage others. This can include many things such as: cigarettes to discourage smoking or high fuel composition cars to discourage pollution. In March of every year, the government release information about the changes of taxation. Toys ‘R’ Us have to discuss if they are going to make their products more expensive in order to cover lost profit. If......

Words: 1817 - Pages: 8

Premium Essay

Political Factor

...produce a greater quantity of a good, product, or service than competitors, using the same amount of resources. The principle of comparative advantage refers to the advanced level of a kind of innovation and the replacement of the old technology. * For example: * A have an hour to write 100 software or rub 200 pieces of glass. * B have an hour to write 50 software or rub 20 glass * A is stronger than B in each aspect, so that A has absolute advantage. However, B has more advantages in writing software because the efficiency of the glass is even worse, so B has comparative advantage in writing software. * 1. First,regulate supply and demand in the market of various countries. Second, promote the full use of production factors. Third, exert a comparative advantage, improve the production efficiency of countries in international trade is an important basis for the comparative advantage and comparative advantage. * 3. The barriers to trade is the artificial restriction to the exchange of goods between countries and countries, mainly refers to a country to foreign goods and services to implement a variety of restrictions. * Generally divided into two categories of non tariff barriers and tariff barriers. * Tariff barriers are duties or taxes that a government puts on products imported into or exported from a country. Government rarely impose tariffs on exports because they generally favor exporting products to other countries. * Non-tariff......

Words: 750 - Pages: 3

Free Essay

P6- Political, Legal and Social Differences

...salicylic acid had gone. The original mass was 2 grams, after the crystallisation it was 1.03 grams. The reason I believe that the recovery was only 51.5% was because when filtering the solution some of the crystals would have been left behind on the filter paper or the sides of the beaker and flask. This would have reduced the final weight of the acid. Also the length of time that the acid was left to cool would affect the percentage recovery. The reason for this is that when the solution of distilled water and salicylic acid are cooled the acid begins to form crystals. If the solution was not allowed to cool for long enough then some of the acid would have passed through the filter paper as it would still be dissolved in the solution. Factors that affected purity The purity of the salicylic acid would be affected by the equipment used, the effectiveness of the filter paper, the age of the sample and how it is stored. Accuracy of method used The method that we used to test the purity of the salicylic acid, aspirin and recrystallized salicylic acid was effective and allowed up to calculate the results we needed. However there are some areas that could be improved to make the results more effective and repeatable....

Words: 481 - Pages: 2