BUSINESS

External Influences Affecting Firms and their Activities

External Influences Affecting Firms and their Activities

Legal

Supermarkets targeting pubs to exploit legal loophole, says Camra

Available at http://www.guardian.co.uk/business/2012/nov/19/supermarkets-target-pubs-loophole-camra

Rebecca Smithers, consumer affairs correspondent, guardian.co.uk, Monday 19 November 2012 16.40 GMT

Summary of Article

The article in discussion here takes into account the legal aspect of the PESTLE analysis. In the United Kingdom, the pub industry is facing a crisis of sorts with supermarket giants such as TESCO taking over pubs by converting them into mini markets. This represents loopholes in the legal system that enables such retailers to consume local businesses with ease. The legal framework with its drawbacks is the major reason behind the move. It is evident that businesses continue to seek gaps in the law that would allow them to expand without facing any lawsuits. Such quest of businesses is detrimental for local or small businesses that, eventually, succumb to the pressure. The gaps in the legal system in the United Kingdom have enabled TESCO, Sainsbury and The Co-Operative to convert approximately 200 pubs. Camra or Campaign for Real Ale has noted that more than 54 pubs remain in danger of being converted (Smithers, 2012, the Guardian).

According to Camra, inadequate and weak laws have contributed to the destruction of local communities. Camra plans to extend its campaign to render pressure on the government to review its policies and fill the gaps that exist in legislation. Critics in the United Kingdom believe that weak laws also leave the council helpless in this regard. According to the law, pubs fall into the category of retailers thereby taking away the aspect of planning permission which is necessary before a retail business can serve. The Sunday Trading Act allows the business to bypass law. Camra's chief executive officer Mike Benner stated that due to the fallible law retailers such as TESCO use the opening to grave consequences. Since supermarkets value location, pubs operating on such prime real estate often become soft target. This is also becoming a threat to the business environment of the United Kingdom. It represents the disregard manifested by large business for the small-medium entrepreneurs and the framework that governs business ethics and practices.

The development of such retail stores also serves damage the surroundings and adds to the population woes of a densely packed neighborhood. Such legal loopholes also destroy the culture of an area by removing where people used to gather and spend their leisure time.

The alarming pace at which pubs are being converted into mini-markets is damaging the social fabric of United Kingdom's culture. In order to prevent from giants like TESCO taking over small pubs, the government needs to take prompt actions to rectify the issues in the system. On the other hand, TESCO denies the policy of converting pubs on the basis of their location value. Michael Kissman, TESCO's community director, points that the company only takes over pubs that have been vandalized or already out of business. Kissman believes that TESCO instead looks to serve the community ...