A further analysis on how Tesco are affected by Political, Legal and Social factors.

1. Unit 1 M3
Lewis Appleton 1 Miss Johnston
Political Factors
Tesco
Tesco are mostly affected by Taxation. Everyone within the business are affected by
this is because the profits that are made by the business are reduced from taxation
such as corporation tax. This to the different employees within the business having to
be paid less to be able to make up for the loss of profits, as well as this the products
sold by the business will have to be sold at a higher price. This means that customers
will have to spend more money. This is a very bad effect on the business because it
means they will make a lower rate of profit and for this they will have to do other
things to make up for the losses. The effect of this is very bad on a business because a
high corporation tax adds up to a huge loss of profits. The way this factor affects the
business is because the money that they make in profits has a certain percentage
deducted and goes to the government. To combat these problems it will mean people
that spend money on the business will have to spend more and people that receive
money from the business will receive less. This puts the business at a disadvantage
because they will lose money.
BritishRed Cross
The government support the British Red Cross because they are an organisation
within the voluntary sector and the government does this through grants and tax relief.
The money provided from the government allows the organisation to carry out their
operations and this is why this is the most important factor for the British Red Cross.
Without the money the government provides the organisation will not be able to carry
out the majority of its operations because they will need additional funding. The
money the government provide to organisations like these are called subsidies.
Legal Factors
Tesco
Tesco are mostly affected by the competition law, this is because they are one of the
leading businesses that do marketing within the UK and therefore there are certain
laws they have to follow. This is because they are not allowed to dominate a certain
market group or copy the operations of other competing businesses and all of the
competitors should be allowed to have a fair competition. The leading people within
the business are affected because they are the people that carry out the main
operations that affect how competitive they are. This can be a bad effect because it
restricts them from doing certain things to try and be the leading competitor. This is
also a very large effect as Tesco is one of the most leading competitors.
BritishRed Cross
British Red Cross are mostly affected by the contract law, this is because that this is
the only law that really applies to them as they have to ensure of the safety of their
volunteers. The people that are affected from this are mainly the volunteers as they

2. Unit 1 M3
Lewis Appleton 2 Miss Johnston
will have to submit information for the contracts. This effect is good on the volunteers
because if any problems were to happen they will be able to be protected. The effect
isn’t very large and only has any difference during major consequences. This factor
has a small impact on the firm because it gives them an increased responsibility. All
the firm has to do to combat this is go through with their volunteers and take some
time to fill out contracts. There are also paid employees at British Red Cross and
therefore the employment law also affects them such as changes in minimum wage.
Social factors
Tesco
Tesco are mostly affected by the demographic issues, this is because there is a rising
population. Nearly everyone within the business is affected by this because it means a
variety of things. This effect can first of all be a very good thing for Tesco because of
two main reasons, first of all the increase in the population means that more people
are going to be buying things and therefore Tesco is one of the places that will be
used. Second of all there is an increase of people looking for jobs which means three
more things, Tesco have a larger choice of people to choose for jobs, Tesco can
reduce the salaries and still have a larger amount of applications, and Tesco can raise
the qualifications to give the same effect. This is a very large effect on the business.
This causes an impact because there is more demand for products, in response Tesco
can higher product prices and still makes a profit.
BritishRed Cross
The British Red Cross are mostly affected by the demographic issues as well; this is
because there is a rising and aging population. Everyone in the British Red Cross is
affected by this because of many reasons, first of all there will be more people
available to work for them but second of all there will be more people that are older
and therefore they will need more assistance. This can therefore either be a good or
bad effect on the company as there are two sides to the situation. This effect is also a
very large effect because if the company does not have enough people available to
help others then there will also be more people needing help and therefore will go into
a bad spiral of being unable to help people. In response to this the British Red Cross
will possibly have to increase awareness of their organisation in hope of getting more
volunteers.