Unit 4 D1 Evaluate the appropriateness

Tesco's has recently had to make many changes in their staff and have had to change the management structure to be able to pay every manager fairly and pay the wages for their general employees. These effects were taken place due to a major profit change and an unstable financial system. Another effect that has been changed is the Tesco pension scheme back in 2012. The Tesco pension scheme had changed due to financial problems however this would mean employees who have a pension scheme with Tesco will have to work longer if they were in their early 60's . This became a challenge for Tesco's as they couldn't afford to pay out on pension schemes at that precise moment.

Tesco operates in 14 different countries. Therefore its performance may be influenced by the local legislation and political factors. There are

| There are figures involved in previous years in which you can compare how much profit Tesco had over the last decade or so, examples being an increase in profit in the UK from 18,000million to 27,000million from 2001 to 2005.

In order to maintain a business effectively it needs to be successful, Tesco’s have been one of the most successful companies’ worldwide selling products and opening stores in 12 different countries. Research shows that Tesco’s profits are getting higher and higher as they are developing into their new E-Business. There are many ways to now access Tesco’s which is making it easier for customers to buy from them. The Daily Mail states that Tesco’s are earning a £105 profit each second.

Tesco also have social factors that affect them, as the business have charity centre in helping the less privilege people and the more these people gets poor, the more they will have to stretch to help out which also spending money.

As I have mentioned before, this research paper is being taken exclusively with the aim to evaluate the Tesco’s performance in both financial and business terms over a three years period. Since the financials will be compared with its three year

Another internal economy of scale from which Tesco benefit is technical. As they grow, they are able to use the latest equipment and incorporate new methods of production. An example of is their new self-service checkouts from which people can purchases their goods from a machine using a scanner. This increases efficiency and productivity, reducing average costs of output because it means they don’t have to employ as many workers.

Strong cash position. At the end of Q4 2013, Tesco has $97,277 (in hundreds) which is an increase as they have continually grown their cash consistently over the past few years.

The purpose of this report is to analyse Tesco’s annual report. The reoprt consist of a sypnosis of Tescos, describing what it does where it does it, how many people it employs and whether it is growing or declining. It also consist of the main accounting policies used by the company; analyses of its financial performance for four years. It also shows the ratios for the performance analyses.

Demographic Issues - There is an increase in demand for the goods and services that are offered when the population of a country starts to grow, there is also an increase in people that are available to work. This can be seen in the UK where at one point they were growing at a fast rate, this was the result of changes in the economy which had persuaded the government to make immigration of labour easier. This affects Tesco because it means two main things can happen. Firstly, there are more people; this means more households, therefore, more shopping to run on. Tesco can use these statistics to sell more products in specific areas, this way Tesco is able to make a faster rate of profit because of the changes.

Profits for Tesco’s operations in Europe, Asia and Ireland increased by 78% during the last fiscal year. The company has a strong brand image, and is associated with good quality, trustworthy goods that represent excellent value. Tesco’s innovative ways of improving the customer shopping experience, as well as its efforts to branch out into finance and insurance have also capitalized on this.

The relevance of evaluating both the financial performance as well as position of Tesco PLC cannot be overstated. This is more so the case given the need to determine the stability and viability of the company going forward. This text seeks to evaluate the financial performance as well as position of Tesco PLC by amongst other things analyzing the entity's financial statements. In this case, the evaluation will be based on the company's recently published annual accounts.

Tesco has increased their market share by increasing their product and service line. Moreover, the main target market of Tesco is the grocery market that covers the majority business of the company.

Tesco currently leads the UK’s other leading grocery retailers in terms of market share. This pattern is repeated online.

The company was also the first UK retailer to register profits of more than £2 billion. This is hardly surprising given that for every £8 spent by UK consumers, £1 will be spent in Tesco. Part of the reason for the success of Tesco has been the ability of the managers at the company to determine exactly what their customers want and provide it quickly, efficiently, conveniently and at low cost. The company has been able to draw customers away from rivals whilst consolidating their grip on the loyalty of their existing customers. Tesco has been able to use the value of the brand to enter the financial services market successfully. Where rivals have struggled to make much impression against traditional financial services retailers, Tesco has used the brand effectively to offer a range of services such as savings accounts, travel and motor insurance, and loan facilities. There has also been an internet mortgage-finder service. A partnership agreement with the Royal Bank of Scotland ensured that customers received a quality service that they could trust. However, one of the most risk-bearing and adventurous initiatives adopted by Tesco was