Political Factors Affecting Tesco
Tesco is arguably one of the largest supermarket chains in the United Kingdom. Thus, it is in the spotlight at almost all the times that decisions need to be made with regards to business activities and other players in the industry. Thus, it is expected that there are quite a number of factors, some political that can impact its operations or the way that it does business. Read through to find out about some of the political factors that impact Tesco.
It should be noted that politics play a great role when it comes to the regulation of business activities. This occurs through laws and legislations that are sanctioned by bodies like the European Union, the UK government and the World Trade Organization. There are several elements that politics can impact like fiscal policy, import and excise duty. Besides, it should be noted that through politics, it can also be easier to acquire infrastructure. For instance, the UK government has been very instrumental in the expansion of Tesco through the provision of good quality communications infrastructure. The UK government has provided broadband and landline phones. Besides, it has also made sure that waste and sewerage is removed from the streets. In this way, Tesco has been able to reduce the costs of its operations and enabled it to open up branches in various localities.
In the UK where Tesco does business, there are quite a number of trade unions that in one way or another can affect the way in which Tesco does business. Employees who are registered with trade unions usually have certain rights that may not be in line with the policies of Tesco. In most occasions, Tesco has not approved hiring employees who are affiliated to certain trade unions on grounds that they impose certain laws that are against the way in which their operations are scheduled to run. For instance, employees who are affiliated to trade unions often demand pay hikes, a move that has not gone down so well with Tesco considering that they are being pushed by trade unions to increase salaries for their employees even when they do not have such plans. In the event that the company fails to deliver the request, trade unions result to industrial action that ends up paralyzing the operations of Tesco.
Through policies formulated by the European Union, Tesco can now enjoy a viable trading platform and even expend its operations to an international scale. This is because the European Union allows the free movement of goods, services, people and capital across all its 27 member states.
When looking at the political factors affecting Tesco, it is also important to look into the aspect of import duty. This type of duty is levied on goods that are imported into a country and affects Tesco considering the fact that it imports some of its products from China and some East Asian nations.
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