The Business Environment

Contents Page

Tesco- The business environment....................

NHS- The business environment.......................

Tesco Suppliers..................................................

NHS Suppliers....................................................

Bibliography......................................................

Tesco- The Business Environment

Tesco was started in 1919 in London’s East End; it was Jack Cohen who started selling from a stool after leaving the Royal Flying Corp at the end of the Great War. He used the money he received after demobbing to buy his first days stock.
Jack Cohen’s first branded product was Tesco’s Tea, released in 1929. The brand name came from the first two letters of Jack’s last name (CO) and the first three letters of his collaborators TE Stockwell (TES).
After expanding further Tesco first floated shares on the stock market during the 1940’s. They have now since then expanded into 12 countries around the world, employing over 530,000 employee’s and serving ten’s on millions of customers every week.

Tesco’s have come a long way since the first stall Jack Cohen set up in 1919. They now operate a huge retail business operating in many different markets e.g. Groceries, Electrical, Clothing, Banking, insurance and their own mobile network.
In addition they have multiple types of store; Normal Tesco stores, Tesco’s extra, Tesco metro, Tesco garages.
Groceries- Tesco’s stores are continuing to grow all the time, with new technology developing all the time Tesco’s are continuing with developing their stores. Idea’s such as self service and scan as you shop are just two of the new ways making it easier for customers to shop. They offer an incredibly larger range of products in their stores with food distributed from local producers and also farmers round the world in fair trade communities; as well as having many of their own brand products.
DOT COM- Another example of how Tesco’s have advanced along with the world’s technology. DOT COM allows customers to do their shopping from the comfort of their own home, they can choosing an entire shopping trolley online and an employee will then do the customers shopping for them and have it delivered to the customers door.
Clothing & Electrical- These two services are found on Tesco’s online shop or in the larger Tesco extra stores. Tesco’s own their own clothing brand in Cherokee and have made deals with many companies to sell multiple electrical items. This has widened their market to much more than just an average food shop. Tesco’s have become the third biggest retailer because of their determination to expand further only falling short behind Wal-Mart (USA) and Carrefour (France).

Pharmacy- Tesco’s run their own pharmacies within some of the larger stores it is for this draws customers in to be able to receive their proscribed medication which Tesco’s hope will then draw the customers to do their shopping while they are there.
Tesco’s Bank and Insurance- Tesco’s now allow customers to invest in home, pet and car insurance etc as well as having their own Tesco bank card that with a simple swipe allows the customer to pay for their shopping in store.

Tesco’s operate in the tertiary sector and their purpose is to maximise profit wherever it is possible to do so. Operating in the tertiary sector means to provide a service either to another business or customers. Tesco’s provide services to both, mainly to customers but also to other business’s e.g. Costa Coffee allowing Costa to set up coffee shops within the store with the idea that shoppers with go to Costa afterwards or that customers go for a coffee and then decide to do some shopping whilst they are there. Another example of a business in this sector could be Morrison’s they compete in the same market of customers as Tesco. They too provide a service to the customer.
Tesco also operate in the private sector as they are not government owned and the public do not fund them with taxes however they are a public limited company meaning that they float their shares on the stock market. A PLC is a company that I owned by not just one individual, it is owned by many shareholders, these shares are bought on the stock market. The value of shares goes up and down in worth depending on how well the Tesco is doing at the time. Should the company become bankrupt and in debt then each owner (anyone who owns shares) is viable to lose the amount they have invested in the business. Owners also have limited liability meaning that should Tesco ever end up in large amounts of debt, owners can only loose what they have invested into the business whereas unlimited liability means that should a business owe a lot of money, owners can have their items such as cars and even homes repossessed to pay back the debts.
Tesco’s are a large business employing over 530,000 people in 12 different countries across the world (Tesco,2013), we know that Tesco are a large company due to the fact that they employ so many people, this is one of multiple factors including how many stores the company has etc in Tesco’s case they operate in 12 different countries. This would show that they are borderline International/Global business; this is because they are operating in many different countries worldwide however they have failed to break into the American market due to the company WAL MART. For this reason I believe Tesco are an international business and that they are not quite global as of yet, this is because they have not yet broken into America or Australia and these are some of the biggest and most powerful countries in the world; however this probably an aim for Tesco in the future and should they expand further they would become a global company. Furthermore Tesco are high in the Footsy 100 rankings meaning that their business is highly profitable.
For Tesco’s to function on a daily basis a huge amount of effort is required, they firstly have to make sure as much stock is on the shelves as possible. This requires getting huge amounts of food delivered from multiple different suppliers arrives on time and that they have the man power to fill they shelves. This means that wages have to work out how many hours of pay are needed at what times on different days as they cannot and must not go over on wage and overtime budget. Furthermore they also need to meet the policies they have in place for customers e.g. no queuing at the checkouts. The idea is that when arriving at a checkout, you will only ever have one customer ahead of you in the line; this takes hard work to be able to pull off and that for every checkout to be open when possible. In addition they also need to empty and check that the right money is in the checkouts and put into the cash office at the end of each night, from here it is counted and sent away. Trying to keep as little cash as possible in the store means there is a lesser chance of a robbery. However there is not always the right cash in the building, meaning that a product has not scanned, customer has given the wrong money un-noticed or the incorrect change has been given.
Tesco’s finance department are required to have a record of all the business transactions, make sure that each department is allocated there months budget and that they do not overspend. Furthermore their job is to measure the financial performance of Tesco on a daily, weekly, month and yearly basis. In addition they must make sure that there is always a good cash flow and they always have enough money in the business to pay off debts. Finally there measure of financial performance and financial predictions can then lead to higher management making important decisions regarding the business.
The human resource (HR) department is one of the most important to Tesco. This is where all of the new recruits come from. The HR’s job is to recruit, train and develop staff. So therefore it is there job to find the right people at the right time and place for the job. From this point it is in the hands of the HR department to make sure each employee reaches their full potential. HR also has a legal obligation to keep all documents in their possession confidential. The HR department are also viable for looking after each individual employee, meaning that they are getting fair pay and good working conditions etc.
The marketing department is the link between the business and the external world. It is there job to advertise promotions and products within the store so without marketing Tesco’s would sell little products as nobody would ever know about any deals on at certain times. Marketing success usually comes down to a company concentrating on the ‘4 P’s’ of marketing; Production, promotion, place and price.

NHS- The Business Environment

5th of July 1948, Health Secretary Aneurin Bevan launched the NHS. This was the first time in the history of the UK that health care was free. In the view of time itself the NHS has not been going very long at all but in 65 years medical knowledge and treatments have grown astronomically and have caused many diseases and illness’s to be totally eradicated. What the NHS has achieved in 65 years is incredible and with technology advancing all the time it is endless possibilities when it comes to curing patients.

The NHS is a public sector business meaning it is funded by the government. The people of the UK pay taxes in which money is put into the NHS to provide a service. This means that the NHS is also operating in the tertiary sector as it provides a service to customers – medical care.
This therefore clearly defines the product and service of the NHS. To help recover ill patients without any medical fee’s. Its product is the equipment and treatments the NHS offer, it is a well known fact the NHS offers some of the best medical care in the world without the worry of having to pay huge medical fee’s after treatments and operations. The NHS offers many business services as in treatments but also in its aftercare to all customers. The NHS attempts to get patients seen to and dealt with as fast as they can give the best service. However budget cuts have meant service isn’t always the best and a visit to A&E can take a good few hours out of the day. The treatments they offer mean that they are by far the best health service in the UK. There are of course other businesses working in the same sector that provide the same service however this is a very small percentage of private medical care which is probably a lot faster and perhaps a better service than the NHS by the smallest margin, but however it comes at usually quite a large fee and so this is why the NHS is a large company with a monopoly of the market due to the fact it provides a great service for no charge. We know this because the NHS employs thousands of staff and has many different hospitals across the UK. The NHS employs thousands of fully qualified doctors, surgeons, nurses etc and it also provides a good opportunity to those who have just left full time education with the apprenticeships it offers. However for the size of the NHS it is still only a national business as it only operates within the UK.
The NHS is a private limited company as you cannot buy shares into it, it is run and owned by the British government however it does still have limited liability to the most extreme as it is funded by the tax money from the British public and this is very unlikely to ever stop therefore there can be no freeze on the money coming into the NHS. However each hospital is usually run as a separate business, therefore liable for their own debts. But should the debts become too large the government would then tend to intervene.

The NHS is probably the hardest worked business in the UK, to operate on a daily basis it needs so many key aspects, to have the right people and equipment in the right place at the right time is the first and most important thing. Its customers are never ending 24 hours a day, 265 days a year, meaning that they must have enough to operate all day every day. In addition the suppliers must make sure each hospital has the right medical and prescriptions every day and that they are fully equip to be able to perform almost any emergency surgery.

Stakeholders- Tesco * Owners (shareholders) * Employee’s * Customers * Suppliers * Government * Local communities * Trade Unions

Owners- this is one vital stakeholder in any business, they make the most critical decisions regarding the business, these decisions can work and they can fail, make profit or end in loss. Decisions also affect other stakeholders such as customers. Good decisions could lead to more customers using Tesco whereas bad ones could lead to customers choosing to use another supermarket.
Employee’s- These are also another large key to the success of Tesco’s without the employee’s to fill shelves and operate the checkouts the business would become inactive and unable to function. So it is vitally important that the owners treat employees with the upmost respect and have them in mind when making large decisions as it is the employee’s that will put these decisions and actions into place.
Suppliers- This stakeholder has a large impact on everyday life in Tesco’s. They have to make sure that deliveries are on time, without the deliveries Tesco’s cannot replenish the shelves. Each supplier is competing against one another; this is because Tesco’s is a large company and will buy in bulk giving suppliers regular and large amounts of sales. This means Tesco’s can demand cheaper prices generating more profit for the company.
Government- This is probably the stakeholder that Tesco’s least like, they do not have much to do with everyday life when it comes to operating Tesco’s however they do want to make sure that Tesco’s pay the right taxes each year etc. The government also form laws that Tesco’s must abide by, such as, Sunday opening and closing law. That by law Tesco’s can only operate for 6 hours on a Sunday.
Local Communities- Tesco's have a large impact on local communities with regards to building new stores on new estates etc. For someone buying a house it can be a large plus point if they have a Tesco’s store within walking distance or a short car journey from their house. However it can also hinder the local community by possibly increasing house prices in the community as it such a bonus to have a large supermarket near to a housing estate. E.g. The Great Notley estate, Braintree.
Trade Unions- The trade unions are designed to protect staff at work. For instance each member of staff has the option to join the union when starting at Tesco. The unions aim is to protect each member of staff when they are either treated unfairly or dismissed unfairly. The union will represent each member of staff when he/she needs their support when fighting any disagreement between the company and themselves.
Stakeholders- NHS

* Owners (Government) * Patients * Local Community * Suppliers * Employee’s

Owners- the owners are in this instant the government, the NHS is run and funded by the government, the Government employ directors etc to run the NHS as a whole. This is where the Stakeholders in this instance link very strongly, due to the NHS being in the public sector it means the general public’s taxes fund it as a business. This links it to the local communities or in this instance the entire countries. As without their taxes the NHS would not be able to function.
Patients- these are also very important as without them the NHS would have no reason to function however for a financial benefit the actual patient has no benefit to them as it is the patient’s taxes that fund the NHS. The patient does not however have to pay any medical fees after any treatments.
Suppliers- This is still another huge part of the NHS it is down to the other large companies to supply the tools and equipment to the hospitals without all of this the NHS could not perform the treatments and scans etc. Without the treatments available today the NHS would not be as predominant as it is so it is vital that suppliers work closely with the NHS.
Employee’s- this is the most important stakeholder alongside the patients. The employee’s are under constant pressure, and have in some cases people’s lives in their own hand. Without the employee’s the NHS could not function. Some of the employee’s have spent years training to work as surgeons and doctors. This shows in its self the dedication and commitment needed to be able to work for the hospitals. Most employee’s have to work long shifts and this in its self shows the dedication needed to become an employee at the hospital.

Bibliography

http://www.tescoplc.com/

http://www.nhs.uk/Pages/HomePage.aspx

http://en.wikipedia.org/wiki/National_Health_Service

http://en.wikipedia.org/wiki/Tesco