BUSINESS ENVIRONMENT

Business Environment

Business Environment

The Role and Purpose of the Public Limited Company

The company, Tesco Plc, is one of the global companies operating in the markets of general merchandise and grocery. It has its headquarters in Cheshnut, United Kingdom. Considering its revenue generation, Tesco plc is the third-largest global retailer which is followed by Wal-Mart and Carrfour, while concerning the profitability, the company is the second-largest. Tesco operates in more than 14 countries all across the world, and has gained the position of a market leader in the grocery market of UK, Thailand, Ireland and Malaysia (Palmer, Mark, 2004, pp.1075-1105).

The aim of Tesco UK is to cultivate in the United Kingdom foundation, it is still as essential as it was considered in the year 1997. The operations of Tesco performed in the United Kingdom are the highest contribution to the business group and it earns maximum profit and sales. At present the Tesco is earning one billion pounds to improve and show their commitment in enhancing the experience of shopping trips. To augment speed of improving things that are desired by the customers would require capital investment and significant revenue. The incorporated changes will revive the shopping trips of the customers and it will subsequently improve the performance for the shareholders.

As a public limited company Tesco has the thirteen percent of the United Kingdom's retail market. It empowers the company for multi format capability which means that it will maintain the growth share in the food market and it would further enhance the contribution space of the hypermarkets will give the company an opportunity to gain higher number of shared in the non food market as well(Palmer, Mark, 2004, pp.1075-1105).

Companies that are public limited are businesses that have their share price listed on the stock exchange of the region, they are located in. In order to be a public listed company in United Kingdom a business must be capable of issuing share capital worth at least fifty thousand pounds. Addition to that the company must be able to reissue twenty five percent of the shares of nominal value. Currently, Tesco has the power to raise a hefty amount of capital by selling their company shares in the general public. The shares of a company are bought and sold in a stock exchange.

As a profit and loss company Tesco has the benefit of having limited liability which decreases the financial risk. If in any case Tesco goes bankrupt and falls in the burden of debt, then the shareholders will only lose the original value of their full paid share at an incompatible price. The personal property of Tesco remains immune, whereas in other type of businesses such as partnership and sole traders have unlimited liability, which make the owner completely liable for all the debts caused in the business. There are several Stakeholders who control Tesco, as they have invested in the company through shares via stock exchange.

The main benefit of a public limited company is that the share ...