Individual report about Tesco – Essay Example

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Government decisions affect supply side of retailing like general issues like taxation on business rates and VAT rates which affect retailing like other businesses. Decisions on road pricing affects the costs of movement of goods, fuel tax etc. Economic forces The economic structure will affect the retail landscape through construction of landscapes for consumption. The recent economic situation has made the life of these retail stores quite difficult. But the only safe assumption is that the broad economic structure of Britain will remain in place, this would open scope for further growth in retail sales.

There are many developers who are willing to invest in the commercial property of UK. Tesco officially announced that the company is looking to invest 2 billion pounds in China and thus is expected to have larger profit margins (Jones, 2013, p. 1). Following the 2008 financial crisis the UK economy was under recession and there has been a sharp fall in GDP and the disposable income of household. In 2009 the growth of disposable income in UK was even lower. Social Factor The retail grocery industry is shaped by social changes.

These include personal value, attitudes, lifestyles, demographics changes and household structure etc. Changes in the above factors will create opportunities and threats for the retailers. The demographic changes have profound impacts on the retail stores since individuals of different consumer behaviours will have different preferences and purchasing power (Ansoff, 2007, p. 152). With change in age structure the preferences of goods changes. Further the type of services and products which are demanded by consumers also change according to personal, attitudes and lifestyle value. With growth in living standard, individuals are pursuing high quality lifestyle.

Technological factors It is one of the main macro environmental variables which affect the UK grocery industry in terms of supply chain and operations. With rise in internet development there has been dramatic increase in subscription to the Internet. According to office of national statistics 73 % of adults in Great Britain have access to Internet every day. There have been a rapid change in the way of retailing and mainly leading retail supermarkets have successfully set up their online retail store (King, 2008, p.

1). Legal factors The UK legislation system has put in place a number of rules and regulations to monitor the grocery retail industry. The government has put in place many legislations of licensing of alcohol, tobacco, employment and consumer legislation and the registration of food premises.

References

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