Describe how political, legal and social factors are impacting upon the business activities of the selected organisations and their stakeholders. Tesco
In all the business in the country like Britain, they have to have this in mind that there are changes that are taking place in the business environment and to the people who maybe the shareholders. These changes can be the political, legal, and the social factors with the business environment and the country. Political factors of Tesco as a retail and a large business in Britain. Political factors are the decisions that are made by the politicians who have got all the powers to run the country and control over people and their business. The political factors have got three different levels that help to run the people, country and businesses. The national level:
These levels consider is all about the political parties that protect the members of the parliament in the general elections. There is a party that is being led by the prime minister who appoints the ministers in charge of the key areas of the government e.g. Health of the people in the country, education, and also the industry which could be the businesses in the country to make sure they are running smoothly. The international level:
Britain is a member of the European Union (EU). This level has got responsibility to make political decisions that increase the effect whatever decisions that done within the members of the states. The local level:
This level consists of councils that are representatives of the population of the other people and make decisions about the local issues on behalf of the other local members. The local level has got all the people who help to set power for the people who are living in the particular area by providing protections to the people who are living area the council. These political decisions involve making choices that affect large numbers of people and their businesses. The decisions that are made by the politicians are making laws that will tend to favour or give chance to some groups at the expense of others.
Some of the decisions that can be made maybe a favour the business like Tesco when the law is made / decided that every business will not be paying any taxes with whatever they are doing. That can be favour for the shareholders will be earning a lot from their business. But some decisions that are made sometimes may restrain business, e.g. when taxes of the business is raised this will be some of the down fall of the small businesses because the shareholders won’t be getting profits from what they have started in the business. The business will not be providing good services to the people who are the customers so their needs won’t be satisfied. These political factors have got some impacts factors to the business: Political stability: some times, the political stability favours the business. Within this political stability the political factor level that is used is the national level.
This political level will find the way to put its plans into action that the people will have to fellow. The plans at the national level are made public to everyone to know it and they can be of good help to business planning. Tesco as a business can be able to use the government plans to identify the likely changes and how their plans that are made at nation level affect them in their business. This provides business with a degree of faith in whatever they are doing for the next few years for the business that has just been setup. Sometimes is political stability different leadership can be an effect to the business and the people in the country. This is when the elections are being taken in place and the president you hard before changed to another person’s which means all the rules and regulations that run the country or the business will have to change and that can be a bad thing to the people you are heading or the business you will be managing.
This is all like having confidence in your business as a shareholder. if the education level is high in the area there will be more skilled workers and this will leads to high income. High income means demands for goods and services will increase. Taxation: this term means the money that each business pays on each product and that the business sale. The taxes are levied by the national government like with type of taxes called the income tax and the local government which may deal with the business rates with the products they are selling to the customers. Taxation has a very important purpose to the government because it helps it to raise revenue and also enables it to discourage many activities that the business do and encourage others by lowing the rates of taxes so that they can be able to start up. These are some of the examples of taxes that business use
This type of tax deals with taxes on the profits that are made by the companies like energy companies. Income tax:
This type of tax is all about the income the people who are self employed like the sole traders and other people who get income like the employees in the business like the people working in the Tesco. National insurance:
This is the required tax that is being paid for pensions like sickness, and unemployed benefits. This is given to the people who may have left their places of work for important reasons, like may be age, serious sickness and other things. VAT (value added tax):
This type of tax is that tax that is added to the products that are needed and required by the business. So for example if Tesco needs a product from any business outside it, the price it costs will be added on by the Tesco business to get it and that’s called the vat. So it’s always on retail goods that are being bought and into the business. Customs duty:
This is the type of tax that is paid by the business on the imports and the exports of the goods and services. The imports of Tesco as a business will be the goods that are not made and no produced by them. The exports will be the goods that Tesco will be made by the business themselves and they are living the out of the business to other country or to other business that not produce them. The government will have more powers to increase taxes on some of the goods that are sold by the business like cigarettes these are harmful things to human beings. They can because of diseases to people like lung cancer so the government will be fighting against the production of cigarettes by increasing the taxes on it so that people’s health can be better for them.
The government can also make an increase of taxes on the fuel that is being used by cars and machines. The reason of this can be that many fuel oils are making smelly gases causing pollution and that can be bad effect to the people lives. Tesco has all both affects of people’s lives the cigarettes and fuel oil selling and so if the government is making tax increase on them the business will see taxes as high cost that takes and uses a lot of its profit from what they had planned for as business shareholders. Government provides direct support to specific types of business and specific activities in two different from grants and loans. A grant is that money that the government gives to a business and it’s not repaid.
The main reason why the government provides this is because some business activity supports the government policy. The example here is that the government may give grants to employees to go and train others about business and the money that they have given out is not repaid back. The government also gives out loans to business on a specific purpose.
The government loans are of interest rates whereby you borrow money from the banks and pay it back at an interest rate of more money rate you got it for. Government decision to join the European Union because the businesses in this country have got good things and bad things that can be of good help to other countries and their businesses. This is a good thing because trading can be freely without being charged for so there can be free importing and exporting of goods to and from the country. An impact on that can be that businesses have to be more competitive with other business if they want to have trade with the European Union business. This can lead the businesses to produce more and sell more at an affordable price so that they can get free trade market with others. Social factor
Demographics The increase of people’s population in the country or area. This is like the number of people changing from the percentage of 90 to an increase of 100% increase of population in the place. Businesses sell more products and the shareholders get more profits. Due to the increase of customers, there will be high demand of products from the customers. More people in the area will lead to more setting up of new business whether big or small businesses from other people. Households and family
Helps the business to know the peoples expenditure on how they spend since there many people living alone in house. Education All business needs to employ people who have got better education skills on high level for particular job. This can be of help to both the business and the person him/her self. If there was good education in maybe Peckham at Harris there will be more people who will move to Peckham and so the business near or around will get more customers in the business. Attitudes to work
Attitudes at the place of work depend on the different ways people in the business like the employees act ways and behaviour to the customers. If it’s in the bad way them the business will lose customers and so the businesses will not have money. People with right attitudes will be more productive. E.g. Foreigners who are prepared to work hard may be chosen over the local people. Religions:
Religion can be a big factor to the business simply because there many people who are living in the area, many people have got different religions believes that they follow for the best of the religion towards the lord. I will give an example here of Muslim’s are have got different believes towards the business like all Muslims in the world do not eat pork as its part of their religion, they also don’t drink alcohol or even smoke, so all of this can affect the business that can that can be in the area of there are only Muslims around that place so if your business is selling one of the mentions things above you are most likely to het loses from them all since you not getting any customers.
Another religion maybe Christian, there people don’t work on Sundays the reason being that is they also have to go to their place of worship so there is no need for them to go to work. This can affect the business because there will be no people helping in the store to serve the customers so therefore you need to do the job by yourself or ether close the shop on Sundays . Ethics
This in the business are the values principals that run the business, these ethics affect the business through the fair trade in the business this is more like some business should offer fair price to their customers. This money can be used to save people in Africa. In the business like Tesco all the people who buy products like buying a biscuit at 50p and in the other shops the same biscuit is at 40p which means the shop that is selling the biscuit at 5op is having fair trade to help the other people and poor people in Africa. Environment: the business have to use resources well and minimising waste, some of the business wastes that can affect the environment and the bags that are been used in the business for the customers package. Business should make sure that they treat the customer’s very well attitude to male and female role. Attitude to male and female.
In the past years, male use to work and the female used to stayed home to baby sit the children, but this time and year both the genders are now working and there more numbers of woman working that the man, women tend to be more attractive at their place of work than the woman Changes in structures
In the UK, the highest numbers of people living in the country are the old. This is a impact to the business, if there more people in the country and they old people there will be more business springing up to care for the needs of the old people like transportation them in cars from home to their place of care, many of the old people will be an impact for the pharmacies and health centres, which will need to expand into many places Indore to meet the needs of old people department on the population. Legal factors
Consumer laws and regulations:
This is the act where the business like Tesco has got all the powers to make its consumers to be happy and taking responsibility of the business. This act has all the business to satisfy the customers quality which will means that all the goods that the consumers buys are meeting there satisfaction so they are happy with the business serving them as their customers. Tesco has to make sure that all the goods it selling to the consumers is fit for purpose. Like if you as the consumers you buying something from the business like you asked for an x box 360 but instead of the staff in the business giving you the right thing that you asked for they give you something else which maybe wrong that can be fit for purpose so the business has to be so careful with that when serving their customers. Employment law:
Employees are also protected at their places of work and the employers according to the component of employment protection. Before the employees are asking for the job in any place of work in the business they should all have their personal details that can describe them when asking for the job to help the employers? Like they should have their forms with their full names, job tittle, hours they would be happy with in working, holiday pay entitlement all that is needed by the employers to know what you would really want when you are in the business (Tesco).
The time of work like what time they should be coming at the work place and the time they will be leaving to get a proper rest to get ready for the next day. This can help the employees because it can really give them time to spend with their families like their children at home or even going out with their fellow staff members. Wage regulations, this concedes with the employees payment in terms of the money they are being paid for the job that they are doing. They should know how much salary they are getting hourly or monthly which can be done on time because it has to be of good help to them when they need it. Competition law:
In the business environment there are laws that run how the business should compete with each other in terms of what they selling or doing. Law against the preventive business practices to reduce competition. This is like there are more than two shareholders agreeing over making the decisions of making prices on the goods that they are selling in their business.
This can be controlled by measuring or looking at the amount of the product you bought how it was sold to you so that you can get it in the business so looking at the price you were sold make a decision on more than the price you as the shareholders you got it and then make the sell price in your business. In the business to manage the competition with other business all the goods that are sold in the business have to be so affordable to the customers so it’s so more different from the other business that sell the same thing as your business like Tesco its main competitors is asda, Sainsbury that are selling the same things so Tesco has to make its goods more affordable and provide good customer services to its consumers to win the other competition from the other businesses. Conclusion
The result of the political analysis shows that the country is politically stable. But traditional values are still very important and need to be taken into account. If TESCO decides to expand, it must be aware that it is only allowed employing local workers. Also, the cheap local fund borrowing has the benefit over taxes and the good infrastructure is to be seen positively.
In addition to that, the analyses showed that they are all people in the business and the outside the business and minded towards foreign operated supermarkets. The analysis of social factors shows that they are all about the living things like considering the services that are in the business and to the people how they are living like education, families, health and population in the country or in the particular .The high living standards in the country area advantageous for TESCO as they allow people to spend a large amount of their income on groceries that they are selling.