Unit 1 Exploring Business , Assignment 1 - Features contributing to the success of contrasting businesses
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Course
Unit 1 - Exploring Business
Institution
PEARSON (PEARSON)
This document includes 13 detailed pages of distinction-graded coursework for Unit 1 Exploring Business, Assignment 1 - Features contributing to the success of contrasting businesses. Includes P1, P2, P3, M1, M2, D1. Tesco and Macmillan Cancer Support
Features Contributing to the success of contrasting businesses
This report is written for the Economic Development Unit (EDU) at … council and will
investigate and assess the reasons for the success of the two contrasting organisations,
Tesco and The NHS. It will discuss their features, explain how they are influenced by
stakeholders, and assess their relationship and communication with stakeholders.
Introduction to Tesco
Tesco, which operates in the tertiary sector, is one of the world’s largest retailers of
consumer goods. It can be understood from (Tesco plc, 2022) that the company was
founded in 1919 by Jack Cohen, who opened a single market stall in east London using the
£30 he received returning from war. By 1930, the company had opened its first Tesco store
in Burnt Oak, Edgware, north London. That store sold dry goods and Tesco Tea, their first-
ever branded product. In 1934, Cohen expanded by purchasing a plot of land which he used
to build a new headquarters and warehouse. This was the first modern food warehouse in
the country. Throughout the 1930’s he continued to buy stores and expand the business
across London. Tesco PLC owns multiple businesses, including Tesco UK, Tesco Ireland,
Tesco Bank, Booker and dunnhumby. As of today, Tesco has been given the title of the
number one retailer of groceries in Ireland, Hungary, Thailand, and the UK.
Introduction to Macmillan Cancer Support
Macmillan Cancer Support is a charity which provides support for people living with cancer
and their families. Douglas Macmillan founded the charity which eventually was named
Macmillan Cancer Support in 1911, after watching his father die from cancer. This
experience made him determined to improve things for other people suffering from cancer.
At the time, little was known about the disease, so there were limited treatment options
and no support. (Macmillan Cancer Support, 2022) Douglas Macmillan died of cancer in
1969 but his legacy continued, as the charity estimates that in 2021, “nearly 2.4m people
were reached by Macmillan services.” (Macmillan Cancer Support, 2021)
Business 1 – Tesco
Ownership and Liability
Tesco is a public limited company (PLC), meaning that it offers shares to the public, who
have limited liability, via the stock market. Tesco became a public limited company in 1947
when it floated on the stock exchange with a share price of 25 pence. As of 8 AM BST,
October 18th, 2022, Tesco has a share price of 204.40 pence – a 179.40 pence increase from
the share price in 1947. The shareholders have limited liability, therefore anyone who buys
those shares cannot be held responsible for any losses, they can only lose the amount they
have paid for the shares. Another advantage of being a PLC is that Tesco can raise additional
finance through share capital. On the other hand, a public limited company is much more
venerable to takeovers than a private company. This means that anybody who has enough
money could buy out a plc – this is known as a hostile takeover. Tesco being a plc has helped
it become successful because it can pursue new projects, new products and expand using
the additional finances that it has raised from its shareholders.
Purpose
, Tesco is a for-profit organisation which means it seeks to make a profit. Therefore, they use
effective pricing strategies in order to gain this profit. Tesco state that they “aim to serve
customers every day with affordable, healthy and sustainable food – to help them enjoy a
better quality of life and an easy way of living.” (Tesco plc, 2022) They do this by selling food
to millions of people across the UK each year.
Sector
There are 4 sectors in the industry, which are primary, secondary, tertiary and quaternary.
Tesco belongs to the tertiary sector because it provides a service by retailing. Businesses
which operate in the tertiary provide services which range from transportation to education
and healthcare. Furthermore, Tesco also operates in the secondary sector due to the fact
that it manufactures its own products, such as the ‘Tesco Finest’ range. Operating in the
secondary sector means the company operates some method of production.
Scope
The majority of Tesco’s sales are made in the UK and the Republic of Ireland, where it is the
market leader. In 2020 a revenue of approximately £56.4 billion was made there, this was
roughly 14 times what it made in Central European countries that year. Most of Tesco’s
suppliers are located in central Europe and Asia. Due to its international trading, Tesco’s
scope is global. Its global scope is likely a major reason for its success. This is because by
trading overseas it has more choices of suppliers which means they are able to find
suppliers that offer Tesco very low prices, or suppliers that have extremely high quality.
Size
Tesco currently has approximately 354,000 employees worldwide, which means that it is
considered a large enterprise, as it has over 250 employees. Large enterprises are extremely
important to the economy since they employ a high number of people and pay a large
amount of tax. Tesco has over 4,000 stores in the UK and the Republic of Ireland, but its
headquarters is in Welwyn Garden City, England, 20 miles north of London. Being a large
enterprise can have threats such as increased legal liability. Smaller businesses can get away
with certain things that large enterprises can’t due to increased public scrutiny. Tesco’s
annual revenue for 2021 was £66.36 billion, this was a 9.37% decline from 2020. Being a
large enterprise means that Tesco are able to have economies of scale and gain discounts
from its suppliers, this factor contributes to the company’s success. If its size was smaller, it
likely wouldn’t be purchasing as much from its suppliers as it currently is, this would mean it
wouldn’t receive discounts.
Mission, vision and values
Every business exists for some sort of purpose, this could be to help people, or to exploit a
gap in the market. The mission of a business is usually presented in the form of a mission
statement. An effective mission statement must be quick, short, and sharp, and act as a
guideline for how the business operates. It is important because it encourages employees to
think about how their actions will impact the future of the business and its success. Tesco
state that its core purpose is “Serving our customers, communities and planet a little better
every day.” (Tesco plc, 2022)
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