Unit 1: The Business Environment (Assignment 1)
A Summary of the businesses activities and their major activities Tesco is the world’s widest retailers with operations in 14 different countries, Japan, India, United States, and Czech Republic. Employing over 492,000 individuals and serving over millions of customers every week as well as they have a market share of 30%. Tesco have diversified into different markets for example retailing books, clothing, electronics, furniture and they also have diversified into the financial sector by selling car insurance, home insurance etc. Tesco were also the first supermarket to invent the loyalty scheme this is where customers collect points by shopping at the supermarket each point equates to 1p in store when redeemed or up to 3 times their value when used the club card deals, offers on holidays, day trips, when filling up fuel at the petrol station. The UK market shares for Tesco have increased by 30.5% by 2009; these increases follow a decline in the market share of discounts chains Lidl, Aldi in the same period collectively of 0.1%. Details where they operate (locally, nationally and/or globally The company operates globally because they have expanded to 14 different countries so this means they are making more profit than any other supermarket as well as they operate in America, Turkey, China and many more other countries where Tesco PLC function.
http://www.tescopoly.org/index.php?option=com_content&task=view&id=595&Itemid=193 Which sector of the economy that they are in, with a description of this i.e. primary, secondary and/or tertiary? The sector of the company is tertiary because they are bringing in goods and service to the business and to consumers. Transporting goods, via supermarket, advertising insurance for distribution (retail) and then finally selling them to customers through their supermarket. The purpose of the business (e.g. do they sell products or provide services; do they exist for profit or not) The purpose of the company is to sell as many products as they can so they make the most profit out of the other supermarkets, they also have to provide a good service because if they don’t then they will lose existing customers and the customers will go to other companies for example Asda, Sainsbury, Morrison etc, so the company will make a significance loss on profit. The company will also try and become the market leadership so they can have the most shares in the supermarket chain as well as they will need to expand into other countries so they can make more capital.
The type of ownership of each of the businesses (e.g. are they a PLC or an LTD; are they in the public/private/voluntary sector and the advantages and disadvantages of each these The type of ownership for Tesco is a public limited company and it is in the public sector so it means that any member of the public can buy their shares. The advantages of a public limited company are: •
Limited Liability – It is where an investor cannot lose more than the amount invested. The investor is not personally responsible for the debts and obligations of the company. •
More Capital – By selling shares to employees or customers •
Borrowing and Buying Bulk – This will be cheaper because if you buy in bulk you can get a discount on the items and it will be lower price for the certain items The disadvantages of a Public Limited Company are:
Loss of control – This means that decisions will take longer and there may be a disagreement •
Restricted Capital Raising
Public Sector BBC:
A Summary of the businesses activities i.e. what they do
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