• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

How external factors can affect the ability of Tesco achieving its aims and objectives

Extracts from this document...

Introduction

How external factors can affect the ability of Tesco achieving its aims and objectives As well as internal factors there are also a number of external factors which can affect how a business prospers. Unlike internal factors companies have no control over external factors and have to try and adjust to them. A good company will make provisions for external factors changing in order to lighten the blow when they do change, but no company can ensure their measures will suffice. External factors could be the factors which makes a business fail so are just as important if not more important than internal factors. Therefore it is vital that companies pay close attention to changes in external factors and adjust accordingly to them or they could lose their competitive position. There are many external factors which affect Tesco Monaghan including: * Cross border bank holidays * National Income * Legal Issues * Interest rates * Loom of recession (unemployment) * Bad external publicity * Strength of the Pound against the Euro (Exchange Rates) * Location * Ethical views (Climate change, Fair trade) * Nearby parking facilities (Externally owned) * Competition Cross Border Holidays Tesco Monaghan is located in Monaghan town which is part of the Republic of Ireland, however much of the nearby surrounding area is located in Northern Ireland as the diagram below illustrates: For illustration purposes I have highlighted Northern Ireland by using yellow, any area not in yellow is located in the Republic of Ireland. As you can see from the illustration shown above lots of the surrounding area is located in Northern Ireland. In fact part of Northern Ireland is just 6 miles outside Monaghan. This gives you an idea of the number of people from Northern Ireland who may visit Monagahan. As Northern Ireland is part of the UK they have different bank holidays than the Republic of Ireland. ...read more.

Middle

People look for much cheaper alternatives and cannot afford to purchase products that would normally be classed as a luxury. -So what affect can Loom of a recession have on Tesco Monaghan? Currently Ireland is actually in a state of economic recession and the effects are already apparent. Companies all across Ireland have closed and more and more people are becoming unemployed everyday. More people in Ireland are now more dependent on the Government than ever before as it has become so difficult to find a job. In fact Century Homes which is also located in Monaghan has paid off a large number of employees and now operates on a 3 day week. As a result of the current recession in Ireland the unemployment level is at around 7% and is the highest level seen in Ireland in over 10 years. The recession in Ireland is also worsening with unemployment levels steadily increasing and no signs of an upturn in the economy apparent. As a result of this recession in Monaghan alone customer spending has been severely cut with the majority of people only purchasing their basic requirements. Car and house sales are basically at a standstill and banks are not lending money as easily. In order to compete with the recession and accommodate the needs of the customer Tesco Monaghan has also had to/will have to make changes. Firstly in order to reduce their own costs to try and sustain their profits Tesco Monaghan has made staffing cuts. I have a friend who has been working part-time in Tesco for the last two years and he has recently been paid off. This will mean that people working at Tesco Monaghan will lose their jobs and become unemployed. Tesco Monaghan will also have to take an in-depth look into customer trends and their product range offered. As people will have less money to spend they will be purchasing cheaper alternatives so it is vital that Tesco are offering such products at an affordable price for customers with little money to spend. ...read more.

Conclusion

For instance if Dunnes Stores reduces the price of a certain product to attract customer attention then Tesco Monaghan will try and match or better the price. Even though Tesco Monaghan may not be making a profit on that product they must still try and gain the customer's purse and compete for it. Therefore in order to try and maximise profits, deliver unbeatable value to customers and earn their lifetime loyalty Tesco Monaghan must spend time and money keeping a close eye on the actions of their competitors. Tesco Monaghan regularly sends a member of staff around their competitor's stores in order to gain pricing information. It is this collected information which has a direct impact on the actions of Tesco Monaghan. If Tesco Monaghan did not keep an eye on the competition then their aims and objectives would be greatly affected. For instance if they did not try and match or improve on product prices they would not be 'delivering unbeatable value'. If they did not try and match prices then they may lose customers to the cheaper prices. As well as keeping a close eye on competitors price changes and promotions Tesco Monaghan also keeps an eye on other factors, such as services provided. These factors if not matched or bettered by Tesco Monaghan may result in Tesco losing 'Lifetime loyalty of customers'. For instance if LIDL opens later than competitors then customers may take advantage of this and favour LIDL more. Also for instance if staff are friendlier in another store the customers may shop there as they feel they are getting a better service. Therefore it is vital that Tesco Monaghan keep a close eye on all the actions of their competitors and ensure they are combating them. Online shopping has enabled Tesco Monaghan to compete very well with other stores in Monaghan. Home delivery also gives them a competitive advantage over their rivals. Competitive advantage is necessary when similar goods are sold in a number of retail outlets. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Case Studies and Analysis section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Case Studies and Analysis essays

  1. Marked by a teacher

    Frederick Taylor's and Elton Mayo's theories applied in companies - McDonalds and Tesco.

    4 star(s)

    Taylor stated that every company should train its workers scientifically rather than leaving them to train themselves as they might be prone to making mistakes. It aims to unearth and cultivate workmens endowment and let them have the best performance in their work to obtain the highest efficiency.

  2. Microsoft Case Study. Objectives, structure and marketing.

    It's easier to market the product globally because it allows similar marketing techniques to be used to sell the product globally. The aadvantages of this strategy is in terms of low cost in production costs and tends to masters market monopolistic ally.

  1. Nike's Business Ethics. Nikes Corporate Governance would make the decision about the aims and ...

    There are 4 stages to Nike's recycling campaign. So to start with people should bring their worn-out athletic shoes to any Reuse-A-Shoe collection center or shoe drive event. The shoes will then be shipped off to one of the recycling centres.

  2. Free essay

    In this assignment I will be identifying how Tesco respond to internal and external ...

    Social changes This is meant by people living with each other such as 1981 around 7 to 8 people used to live in one house hold but within the 21centry around 2 to 4 people live in one household this means less products are being brought but also it means

  1. PESTLE and SWOT analysis for Tesco.

    Legal factors Legal factors such as new laws and change in legislations have helped Tesco to abide lawfully and maintain rightful operations. The Legal section of the PESTLE analysis is useful for the business in staying up to date with all the laws governing the Tesco's activities, because illegal action can result in extensive punishment.

  2. SWOT and Pestel analysis for Carlton Forum leisure centre

    business outcomes are the same as they tend to differ a lot. What is the reason for such different patterns in result? Each business operates in different environments, what might apply to one business may not apply to another. To establish the environment factors the forces have been split up

  1. (P4) Describe the Functional Activities and the Independencies of Tesco Plc and Coleraine Borough ...

    Higher sales revenue and market share through successfully targeting customers * Effective promotion * Competitive pricing The 4 P's should be clearly followed when marketing; inclusive within these areas will be an in-depth examination of various questions which will require answering.

  2. Evaluate the external corporate communications of Asda and Tesco.

    they can act up on this and customers so they can see what their aims and objectives The mission statement for Asda is: ?At Salisbury?s we will deliver an ever improving quality shopping experience for our customers with great products at fair prices.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work