1.0 Terms of Reference
2.1 The task that we were given was to make comparisons between two different organisations and evaluate how much the stakeholders influence major decisions made within the business.
3.3 Relative information gathered
3.4 Analysis made between the two organisations
3.5 Report Written
3.0 The two Organisations
4.8 I have chosen the above organisations as they are both very similar business setups, therefore they should be slightly harder to evaluate than other businesses that I could have chosen; meaning that I will learn about what exactly happens within a business’s environment, going into detail rather than just scratching the surface. Another reason I have decided to draw comparisons between these organisations is because I have always wondered how Tesco Plc made it to the top of the retail market and how they managed to surpass all competition along the way, such as J Sainsbury Plc.
5.9 Stakeholders within the two organisations:
Stakeholder| Tesco PLC| Sainsbury’s PLC|
Customers| Yes| Yes |
Employees| Yes| Yes|
Suppliers| Yes| Yes|
Investors (shareholders)| Yes| Yes|
Local Community| Yes| Yes|
Competitors| Yes | Yes |
Directors| Yes| Yes|
5.0 How the stakeholders Influence and affect the two businesses
Customers at Tesco PLC are an extremely powerful market turner, and as most businesses run on the traditional saying, ‘supply and demand’ then if enough of the consumers are making a reasonable request, then the norm is that Tesco will usually give in eventually, or in some cases immediately; so long as they believe the request to be profitable enough to merit an introduction. With Tesco being the market leader in the UK, they usually respond quickest with what exactly their customers want, such as they did in 1993 with the launch of their ‘Tesco Value’ line; this was a clever piece of business from the ever-growing supermarket as it forced their competitors into slashing their prices in order to keep up with the rapidly rising retail giant. In this instance Sainsbury’s cut prices on no less than 300 of their most popular products, just three months after Tesco had introduced this new range; then a few months later, Sainsbury’s announced that their profit margins had fallen, that the pace of new superstore construction would slow down and that it would write down the value of some of their properties, thus decreasing the market share of then J S Sainsbury Plc. Something else that Tesco PLC offered that Sainsbury’s didn’t was the revolutionary ‘Tesco Clubcard’, which again was another clever piece of business as it allowed consumers to feel like they were being rewarded by shopping in their supermarkets; they were, but it’s nothing substantial, and the extra revenue that it generates through additional customers is more than enough to cover what ‘points’ the user manages to generate by using their ‘Clubcard’. In this situation, Sainsbury’s were adamant that the new Clubcard initiative was just an electronic version of their previously very popular ‘green card stamps’, which in general terms it was, but the Clubcard was deemed better by most due to the simplicity of just swiping your card and ‘saving money’. The company were soon forced to backtrack and 18 months later Sainsbury’s launched their very own version of the reward card system called ‘the nectar card’ which is proving a decent success.
The employees at both of these large retailers can have a huge impact of some very key areas of running a business; examples of this are expenditure, efficiency and proficiency. For both Tesco PLC and J Sainsbury Plc, keeping the ‘wage bill’ down is...