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

Tesco- Understanding the economy and its effects on the business.

Extracts from this document...

Introduction

´╗┐Tesco- Understanding the economy Demands During the recession, the demands for Tesco?s food and groceries has decreased because customers believed the price of these groceries to beyond their reach. Because of that, customer turned to more affordable retailers? stores like the 99 pence shop or pondland. Tesco lost about 22 million customers to their groceries competitors which caused them to lose 2 to 3 per cent of their UK sales figures. They claimed that this lost was due to discounter brands. Tesco is also set to be cutting back on their electrical services to make space for other things ? this was due to a decrease in demand in that area of the business. This was due to the fact that people didn?t trust their brand enough to spend their money compared to other electrical brad like Sonny. The price of their electronic products was also a put off for customers who felt the pinch during the recession. ...read more.

Middle

So instead of enjoying expensive holidays to other countries now and then people just stayed in the UK and go on family trips to places like haven. Some people starting cutting back on luxury stuff like expensive cars and switching to cheaper and stable cars in order to spend less Also most people during the recession were shopping around and to find the cheapest products and the one that offered good value for money. This cased businesses like Tesco to lose out to competitor such as Aldi who offered much cheaper products which fitted the pockets of customers The government took measures such as monetary and fiscal policies, the aims of these policies were to keep inflation levels as low as possible, maintain the positive growth of the economy (this is close to 2.5%). Also these policies aimed to provide full employment and reduce cyclical fluctuations in the economic cycle One of the key factors leading to the recession was increasing unemployment, as know unemployment is bad for the economy because it causes the government to spend more and reduces fund for other important things. ...read more.

Conclusion

Currently Tesco operates in 11 different countries in some of which they have obtained full ownership of business which means that they were fully allowed to establish themselves in these countries. In others not so much, Tesco wasn?t given full ownership in some of the countries where the currently operate but instead they were allowed to cooperate with other companies within these countries. For example in India, Tesco was given only part of an ownership which means they had to cooperate with another company if they wanted to stay and operate in India. Because growth of businesses in the UK are regulated is always regulated by the (CMA) for the benefits of consumers, other businesses and the economy, businesses like Tesco can?t go any bigger than they already are even if they wanted to. Du to this, businesses are forced to go compete in other countries where they can actually expand further and achieve their aims. By operating abroad, Tesco reduces the ability of the government to regulate them in ways like building more partnership to expand. http://www.dailymail.co.uk/news/article-1091079/Recession-hits-Tesco-Grocery-giants-sales-fall-lowest-figure-16-years-shoppers-turn-budget-supermarkets.html ...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

    Aims of tesco

    5 star(s)

    * Provide and interesting job for staff (People) * Deliver unbeatable value to our customers (Operations) * Be responsible, fair and honest (Community) * Earn lifetime loyalty of customers (Customer) Tesco monitor their objectives by using a traffic light system as shown in the illustration below: They monitor their performance on a daily basis using this system and employ specialised staff to make sure they are operating efficiently.

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

    When creating a new product (Tesco Plc) /service (Coleraine Borough Council), a business will require each of the functional sectors to incorporate their fragment to fulfil the product/service in order enable its optimum performance and successful trade. Below shows various examples of how both businesses use their departments, to make contributions in achieving their aims and objectives.

  1. Unit 12 - International Dimensions of Business Task 1

    - Cut costs - Use internet and telephone services as a quick and inexpensive way to handle all customer bookings and questions Now that all of these aims and objectives have been identified, I will now be explaining in detail as to why RyanAir have these aims and objectives and

  2. For this coursework I will produce a portfolio of work investigating the factors that ...

    This is an extremely good way of increasing their profits as they don't purchase from a supplier as they are using their own brand name. Tesco also ensured they provide for every socio-economic group, they have many different own brand products which they use to compete directly with the well known brands.

  1. NETFLIX CUSTOMERS SATISFACTION

    The go?ls of their rese?rch, however, were to study the ?ntecedents ?nd consequences of customer satisfaction r?ther th?n investig?te how different types of satisfaction m?y influence the over?ll me?sure of customer satisfaction. In ?ddition, our theoretic?l ?ppro?ch sh?res some simil?rities to Hutchison, K?m?kur?, ?nd Lynch (2000), who posited th?t unobserved heterogeneity is ?

  2. PEST is a planning tool which is used by a business to evaluate and ...

    This will make sure that everyone that works for Ginsters is safe and has the right amount of safety training and knows how to keep safe in their workplace.

  1. Applied Business Studies Unit 7: Career Planning

    management but, as there is strong competition, and as a result qualifications are often necessary. The majority of employers will expect a high level of academic achievement or experience in a related Industry (such as hospitality or Events itself). Although a degree is not essential, entrants are typically graduates.

  2. Stakeholders in Sainsburys and the National Trust

    Changes announced this summer will turn this on its head, using the planning system as a tool to promote economic growth ahead of everything else. We know the planning system needs to change and become simpler, and of course support good growth, but bad reform will lead to bad development appearing throughout England.

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