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UNIT 5 BTEC BUSINESS ASSIGNMENT 2 LEVEL3
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Unit 5 assignment 2
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Intro: In this assignment I’m going to be talking about Apples influence byexternal factors.
Explain the external factors that influence a selected business considering
trading internationally.
External Environment
Pestle analysis is used in order to make decisions whether or not to operate in a
certain country. Pestle stands for Political, Economic, Social, Technological,
Legal and, Environmental.
Political
One political factor that could affect Tesco is an increase in tax. Tax is money
that people have to pay to the government. The government uses the money it
gets from taxes to pay for things. This could affect Tesco because an increase in
tax on products could make importing and exporting goods harder for the
business. As importing goods from suppliers could make the price very
expensive which could dent the revenue of the business. Whereas with exporting
you may lose buyers as they may look for cheaper alternatives that don’t have
tax.
Another political factor that could affect Tesco is a change in government. A
change in government may mean a change in policy and new policies that may
not favour certain businesses. It may also mean that there is a new president or
Prime minister. New policies mean changes can be easily reducing profits for the
businesses. With a change in government there could be drastic changes that
could affect apple as a business.
Economic
One economic factor that could affect Tesco is the unemployment rates.
Unemployment is a situation where people are able to work and willing to work
but have no job. This could affect Tesco because if the unemployment rate
increases people will have less money to spend and this will negatively affect
sales and revenue for Tesco.
Another economic factor that could affect Tesco is Recession. Recession is
when for two quarters (six months) in a row the value of all goods sold in an
economy falls. This can affect Tesco because during those two quarters the
businesses revenue will be greatly impacted as it will increase fast causing the
business to not be able to grow. Which will also massively affect the cash flow of
the business.
,Social
One social factor that could affect Tesco is the cultural beliefs of the business.
Social trends relate to the value system beliefs and practices of a population. It
shows how society is changing in the long term. Business must take the cultural
values of their customers into account to be successful. For example, during
Protests about race and sexuality if Tesco isn’t seen as supportive, they are
going to lose customers as they will see the business in a negative light.
Another social factor that could affect Tesco is social trends. Social trends can
affect Tesco because there maybe be new food trends that can become popular
which would make the demand of the goods increase which could then increase
the revenue of Tesco.
Technology
One technological factor that could affect Tesco is Automation. Technology is
science or knowledge put in practical use to solve problems or invent useful
tools. Automation is the use of automatic equipment in manufacturing or other
process or facility. Automation can affect Tesco as a business as the machines
are more accurate and faster making it a lower chance of failure in any of the
products.
Another technological factor that could affect Tesco is improved communications.
Good communication is needed when running a business especially a large
multinational business. This can affect Tesco because it helps information to be
shared quickly and accurately. Which helps the company be able to catch such
big opportunities.
Legal
One Legal factor that could affect Tesco is Employment Law. 1 Legal factor refer
to how the law affects the way businesses operate and customers behave. This
can affect Tesco as a business as employment law determines how well
employees are treated in the business. If Employees are treated unfairly that
could affect the publicity of Tesco and will affect the sales of Tesco.
Another factor that could affect Tesco is health and safety law. This can affect
Tesco as business because employers are responsible for employee's safety.
They need to protect their employees whether that be making sure that the job
and work environment is safe and has no health risks. If Tesco's environment
isn’t safe even for customers, the company will also look bad in the eyes of the
public which could affect the growth of the business.
, Environmental
One environmental factor of Tesco is carbon footprints. Environmental factors
are those factors outside of the business that no one has control over. This can
affect Tesco because people may see the business as harmful which could
decrease the demand of the products.1 Tesco is clearly committed to reducing its
carbon footprint by 50% by 2020. Tesco are minimizing the waste produced in their
stores by increasing social conscience in customers.
Another environmental factor is Plastic Pollution. Plastic Pollution is when there is a
lot of plastic in the environment and it negatively affects animals, animal habitats or
people. This can affect Tesco because most of their packaging is plastic making
there an increase in plastic pollution. Due to this it will then increase the damage the
environment is already facing making the number of customers to also decrease as
they would want to shop at a supermarket who is seen as eco-friendly.
1 https://pestleanalysis.com/pestle-analysis-tesco/
Explain how business support systems enable a selected business to trade
internationally.
The influence of the internet has impacted Tesco as a business. There are many
factors of the internet e.g
• The Ability to Communicate
• Wider Market
• Collaborating with other business
• Telecommuting
• Digital Marketing
Collaborating with other businesses
The internet has helped Tesco collaborate with many different businesses.
Tesco did a collaboration with Carrefour and to do this kind of collab they
used seminars which 1allows participants in different locations to see and hear
the presenter and ask questions. This has benefited Tesco as it has helped
working with other businesses simpler and easier.
The Ability to communicate
The internet has given Tesco the ability to communicate with its customers,
employees and associates. Because of the internet Tesco use Emails to talk
to colleagues from all around the world. Tesco has also been able to use
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