PESTLE and SWOT analysis for Tesco.

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Swadiq Mujahid



In this assignment I will compare the two analytical techniques used in Task 1 in terms of their usefulness in making particular marketing decisions, including the most useful for specific decisions. The business I am using for the purpose of this assignment is Tesco PLC.

Tesco  is a British-based international grocery and general merchandising retail chain. It is the largest British  by both global sales and domestic market share with profits exceeding £2 billion. In 2008, Tesco became the world's fourth largest retailer, the first movement among the top five since 2003. Originally specialising in food and drink, it has  into areas such as , , , ,  and , , retailing and renting , , , , and .


Now I shall look at the PESTLE analysis and try to identify each of the factors

PESTLE Analysis

PEST analysis (also known as the STEER, STEEP, DESTEP, STEP, PESTE, PESTEL, or PESTLE model) stands for "Political, Economic, Social, and Technological analysis" and describes a framework of macro-environmental factors used in the  component of . The model has recently been further extended to STEEPLE and STEEPLED, adding education and demographics factors. It is a part of the external analysis when conducting a strategic analysis or doing  and gives a certain overview of the different macro environmental factors that the company has to take into consideration. It is a useful strategic tool for understanding market growth or decline, business position, potential and direction for operations.


Political factors

By analysing the political influences that affect Tesco PLC (e.g. change in governmental leadership,  changes in national minimum wage, changes in interest rate etc), the company have been able to identify areas of the political factor that their business can stay updated with resulting in good planning and forecasting of future actions. They would agree that the Political factor of the PESTLE analysis is very useful for understanding the governmental environment and what to do when there is a change in political parties.

Economic factors

Being able to identify economic influences (e.g. change in currency strength, influences by the E.U, economic crisis etc) have helped Tesco to strategise the way that Tesco sell their product and their share as well.

High levels of unemployment within the London area may affect the sales figure of the business, which means that not lots of customers will buy from Tesco. These are all external influences that affect Tesco and they have no control over them; but to alternatively strategically they need to make sure that the pricing of their product is affordable.

Social factors

By evaluating the social factor of the PESTLE analysis, Tesco become able to examine society and its behaviours and by segment and target their customers. This factor is very useful for Tesco because they now understand how to alter their product and introduce a new product for their target customers.

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Technological factors

Analysing and identifying technological areas of improvement has also helped Tesco to stay updated. By developing existing machinery and bring self service machinery, Tesco have been able to effectively operate within the workplace to increase the levels of performance and minimising extreme labour.

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 ...

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