Strategic Objectives - Dissertation Example

Tesco Plc is an international retailer with active activities in most parts of the world apart from providing retail banking and Insurance services. Its wide distribution of stores enables customers to pick the products of their choice from various parts of the world. The company delivered a sales growth of 7.4% by the year 2012 and strong international performance with a return of capital employed of 12%.  The company is projected to have a weak growth among its peers due to its low operating profit margin compared to the sector/industry average of 14.39% hence it is considered underperforming in the industry (Tesco Plc, 2012). Tesco Plc realized its potential in the retail industry and decided in many cases to consolidate its efforts with other businesses. The greatest interest was to establish the effect of these consolidations with its aims and objectives in order to unearth the truth on the possible effects of M&As.

PESTEL Analysis

Politically, the recession remains one of the main gamut that are currently affecting all the countries resulting to high numbers of unemployment. As one of the major and wildest growing retailers, Tesco will avail more jobs hence reducing levels of unemployment. Economic factors are significant for Tesco because they influence directly the buying behavior of customers. Recession that hit the UK economy in 2008 resulted to the customers to eat out less and eat more at home. This offers opportunities for grocery dealers like Tesco to grow their production. Sociological aspect involves lifestyle tendencies, demographics, consumer outlooks and views (Chiron and Benayed, 2001). With Tesco’s increase in young professionals, new goods that are in accordance with current customer preferences will be developed. For example, quick microwaveable meals that aid in cooking for those always on the go. Technological features that have had the greatest impact on Tesco has been the evolution in the usage of the internet. It is worth noting that Tesco have taken advantage of the internet to develop an online shopping forum. Through this, they provide delivery services hence carter to a larger part of people at their suitability. Environmentally pleasant, reduced packing is being recognized by the Government. Tesco Plc embraced this through addition of carbon footprint data on a variety of products. These are dairy merchandises, orange juice, and potatoes (Tesco, 2010).