Free Business Environment Assignment Sample for students
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Business environment means all of the internal and external factors that affect company's functions including employees, customers, and management, supply & demand and business regulations. Keeping such importance of business environment in mind, Global Assignment Help has composed this business and business environment assignment sample for the benefits of students. A thorough reading of it will enable them to know how the study on business environment helps the organizations to find out all those forces that can enhance sustainability aspects (Yu and Ramanathan, 2012). The present study has been made on Iceland Foods Ltd which is a private British supermarket chain operating business in UK. The company has an approximate market share of 1.8% in UK food market. The entity conducts its business in competitive market place and it sells frozen foods including meals and vegetables.
Thus, as per the research study, specific information about the market structure of Iceland Ltd has been discussed and along with the same, researcher has also stated several aspects that determine output decisions of the business entity. Furthermore, discussion has also been made on impact of competition policy and other regulatory mechanisms that affect the business practices. Stakeholders play crucial role in the organization; thus the ways through which Iceland manages stakeholder's interest are also discussed in the present research study. Lastly, the benefit of international trade to UK business organizations and to Iceland is also stated.
Understand the organizational purposes of businesses
1.1 Identify the various types and purposes of different business organizations
Different types of organizations exist and operate within an economy. The varied range of business units that operates within country are detailed underneath.
Sole proprietorship: The business unit that operates at small scale and is registered as sole proprietor is referred to as sole proprietorship. It is owned and controlled by single owner who takes entire responsibility of managing business operations.
Partnership: The partnership is a business unit that is owned and controlled by two or more partners. The partners mutually manage business activities and shares all profits and losses.
Publically listed company: This form of businesses is listed as a publically listed company. The business unit is managed by top management and owned by shareholders. It is listed as a company whose real owners are shareholders.
Iceland supermarket: Iceland supermarket is a private retail entity and the business provides all type of food services to the consumers. In other words, it can be said that Iceland supermarket is large retail firm which is providing retail products to the general public. Iceland began business in 1969 and afterwards the establishment of business, numerous stores has been opened by the business entity. The business sells all food services and this helps the entity to operate business with Spanish based retailer overseas (Yannelis, 2004). The main purpose of Iceland supermarket is to deliver prominent services to the clients so that they may not switch to other brand.
KFC: KFC is a fast food restaurant chain that specializes in fried chicken and the major headquarters are in United States. It is the world's second largest restaurant chain after McDonald's and the company is a subsidiary of Yum Brands which is also a restaurant company that owns Pizza Hut and Taco Bell chains. The main purpose of KFC is to deliver quality and different variety of chicken to the customers so that they can enjoy fast food. It was one of the first fast food chains to expand internationally and it has opened outlets in different parts of USA (Xiao and Fu, 2009).
Transport for London (TFL): TFL is a statutory corporation and is a local government body responsible for most aspects of the transport system in Greater London. It was formerly named as London Transport; however now its role is to implement the transport strategy and also to manage transport services across London.
Cancer research: Cancer Research UK is a cancer research and awareness charity in the UK and that works as a charitable organization. The main purpose of cancer research is to treat patients suffering cancer issues. It raises money through donation, legacies, events, retail and corporate partnership and community fund raising (Shaikh, 2010)
1.2 Describe the various stakeholders and how an organization could meet their objectives
Iceland supermarket has been managing all the business practices in effective manner with the support of all its stakeholders. The major stakeholders of Iceland supermarket are its customers, employees, owners, suppliers and shareholders. All the objectives of stakeholders need to be fulfilled in such a way so that they can contribute in organizational resources (Drew and Sriskandarajah, 2006). Iceland supermarket has been delivering proper services to the customers and all such services results in customer satisfaction. Further, the business also makes sure that customers are not cheated from any ground and fair services are provided to them. In order to retain the customers, Iceland supermarket has been considering quality aspects in service delivery process so that needs and demand of clients can be fulfilled (Parkin, 2002).
Employees are the major resources of Iceland supermarket that helps the business entity to deliver prominent services to the clients. Such resources are useful in terms of managing revenue and business profitability. In order to maintain the interest of the employees, Iceland supermarket has to make sure that each and every employee is getting proper support from the management. The organization needs to emphasize on equality and diversity so that employees can consider themselves important part of the business entity (Shaikh, 2010). Furthermore, it is also vital for Iceland supermarket to facilitate equal roles and responsibilities for all the employees so that they can conduct all their duties in prominent manner. All the shareholders of Iceland supermarket are invited and involved in company's decision making and their advice is also considered in company's decision making process. Furthermore, the supermarket has developed adequate relationship with the suppliers so as to get all the resources properly when required. The major stakeholders of Iceland supermarket are as follows.
Creditors/Banks- These are those entities that provide loan to the firm. In return firm needs to pay interest to them. The main objective of firm is to make timely payment of interest to them.
Shareholders- These are real owners of the firm because they provide capital to same. The main objective of the firm is to give maximum return to the shareholders. In this regard, it prepares various business strategies and plans that help managers in increasing business.
Employees- These are those who work at the ground level for benefit of the company. Without them an organization cannot achieve a success. Hence, the main objective of the firm is to satisfy needs of the employees and to give them good working environment.
Government- Government receive tax from the companies and the main objective of the firm is to pay tax on time and to make sure that true financial statements are made available to the regulatory authorities whenever required.
1.3 Explain the various responsibilities of an organization along with ways of fulfilling them
Iceland supermarket is accountable to manage all the organizational operations in optimum way for the purpose of deriving long term sustainability and competitive advantage. Since, numerous people are involved with Iceland supermarket; hence it is required for the business entity to comprehend the expectations of stakeholders. All the shareholders should be provided with considerable benefits such as proper dividends and the business should allow all the stakeholders to access the books of accounts and other financial statements of the company (Parkin, 2002). Thus, in such respect Iceland supermarket is emphasizing on transparent and fair aspects so that associated people can remain informed. The company shall be liable when having any serious consequences and in order to avoid that Iceland supermarket has to make sure that they are disclosing each and every aspect in front of the stakeholders. Since, Iceland supermarket is engaged in delivering food products to the customers; hence the business needs to ensure that quality food is being delivered (Gabriel, 2004).
Further, in context of the employees, Iceland supermarket is required to treat all the employees in equal manner so that they can their motivation level can be enhanced. Several activities related to employee welfare are also organized at Iceland supermarket in which chief focus has been given towards proper employee interaction. Disability Discrimination Act is being followed at Iceland supermarket where in the employees is treated equally. No sort of discrimination exists in the organization (Nimwegen and et al., 2008). Iceland supermarket makes sure that ethical aspects are maintained in the business entity along with proper distribution of resources and dividends among shareholders. Suppliers are providing adequate raw materials to the business entity and they also assist the business entity to meet demand aspects in all areas. This is vital in terms of managing supply and demand aspects (Fernando, 2011).
Understand the nature of the national environment in which businesses operates
2.1 Explain how economic systems attempt to allocate resources effectively
Command economic system is the most effective system because in such economic system, the entire economy is operated under the control of ruling bodies and they are also entitled to undertake finance related decisions about the economic aspects. To survive at competitive market place, business entities are required to consider legal rules and norms as consideration towards such aspect can reduce the probabilities of legal rules and policies (Economic System, 2013). The failed example of command economy is the Communist Soviet Union. Economic system manages resource allocation process and this also helps in administering the flow of resources. The other category of economic system is free enterprise where in interference from ruling parties is less as compared to command economy; thus organizations working in this economy can use allocate and use the resources in adequate manner. Trade related formalities and restrictions are limited in number and such system is being managed by the government bodies. US, Canada, Japan and Germany are some of the countries that are known as developed economies and that follow free enterprise system (Yannelis, 2004). Transitional economy is an economy whereby the country is planning to adopt market economic culture from that of command economy. The economy is considered to be in transition process that is adopting new structure for development. In case of transition, the countries do private its properties and industries. This in turn leads to promoting privatization and supporting economy’s growth.
On the other hand, there is mixed economic system where in the business entity experiences interference from private as well as from government bodies. They are entitled to change the strategic aspects of the business; thus these things can be included in business decisions. UK, Russia and India are some of the examples which follow such system (Matthews, 2005). The political and social considerations influence the business conditions to trade freely with different economies. Chief focus has been given towards wastage reduction so that the ratio of profits margins can be maximized. Iceland supermarket has been operating business in mixed economic structure where in government regulations are required to be considered for managing the flow of resources (Nimwegen and et al., 2008).
What to produce- This is one of the problem of an economy and under this it is difficult to determine that what economy must produce. Every nation has a limited resources and it cannot produce all type of products on its land. So on the basis of identification of quantity of available resource country decide the products that they must produce.
How to produce- After selection of products the next challenge is to decide the way in which items must be produced. Here it is decided that old process of manufacturing will be used or new process needs to be framed. Along with this it is also decided that economy will used labor intensive technology or capital intensive. By considering these factors it is determined that in which way goods will be produced in a nation.
For whom to produce - This is third biggest problem in which economy have to decide for whom it need to produce goods. Means that in this problem buyers for the products produced in an economy are identified. By solving this problem nation identified its target customers and increase its bilateral trade relations with other nations.
2.2 Assess the impact of fiscal and monetary policy on business organization and their activities
Monetary and fiscal policies are different from each other. Monetary policy refers to the policy that is formulated in order to control money supply in an economy. On other hand, fiscal policy is policy in which tax rates are determined, budget is prepared and investment on infrastructure is made through PPP model. Monetary policy comprises interest and repo rates which manage the flow of resources in an economy; further it also has a direct impact on company’s operations. Ruling bodies of UK changes the interest rates and this hampers different pricing decisions of organizations and according to the same, several changes needs to be made. The policies are formulated for the purpose of deriving higher profits and share from the companies; hence fiscal policy can enhance the economic prosperity of the nation (Mason, 2007). On the other hand, fiscal policy involves the government changing tax rates and levels of government spending which influence aggregate demand in the economy. Thus, it can be said that Fiscal policy of the country is concerned with the budgetary aspects and which determines the financial capability of the business organizations. It is an apparent fact that budgetary aspects of the company always allow them to allocate resources in different activities and as a result, it can enhance the survival aspects of the business. It is the fiscal policy that assists the company to determine the tax ratio and its impact on organizations profit. Hence, in terms of impact it can be said that fiscal and monetary both the policies have been changing the financial conditions of Iceland supermarket (Mariappanadar, 2012).
2.3 Evaluate the impact of competition policy and regulatory mechanisms on the activities of Iceland supermarket
Competition policies and regulations are required to be considered by the organizations that operate business in UK market place. As per the regulation, Iceland supermarket is required to consider Office of Fair Trading for the purpose of protecting the consumers and other competitive forces in Britain. Further, the policy also ensures that market work well for consumers by ensuring fair competition and trading. Iceland supermarket has been considering this act and this assists in managing all the business entities in adequate and legal manner (Joardar, Kostova and Wu, 2014). Further, Competition Commission is also followed up by Iceland supermarket which is a public body and which assists in managing investment for mergers and other strategic purposes.
Considering such act assist the business entity to facilitate healthy competition among all the same companies. On the other hand, norms defined by the European Commission are also followed since it upholds treaties to manage day to day business activities. Hence, healthy competition is being managed in retail industry of UK and as result; all the competitors are working in ethical way. Iceland supermarket seems to follow Civil Aviation Authority where in the business entity needs to consider all aspects of civil aviation so that aspects related to transportation processes can be properly managed (Gani, 2011). These rules and regulations are strictly affecting Iceland super market in many ways. Firm needs to comply with these rules very strictly and if it will not do so then strict action can be taken against it for non compliance with rules and regulations.
Understand the behavior of organizations in their market environment
3.1 Explain how market structure determine the pricing and output decisions of businesses
Duopoly market: In duopoly market type, there are only two sellers who are entitled to compete with each other for uniform products and as a result that changes level of output. This exists chiefly between monopoly and perfect competition (Matthews, 2005). Seller’s posses the rights to alter the pricing strategies because they only exist at market place.
Perfect competition: It is the state where in large number of buyers and sellers are present in the market place and where the degree of competition is severely high (Gabriel, 2004). Iceland supermarket has been operating business in such market place where in large number of sellers exist and sell their products. Iceland supermarket is allowed to trade freely with other countries due to this market structure and the business can change the pricing factor as per the amount of quantities demanded at market place. Iceland supermarket continuously responds to demand and it purchase products as per people demand. It forecast future demand and accordingly purchases a product. Hence, firm is following a cautious approach to respond to a demand.
Monopoly market: In Monopoly market structure, there is only one seller who has absolute potency to manage the business solely. The degree of prices can fluctuate anytime; and this can also change the business operations. This market is favorable since no other entities exist in the same market place (Frynas and Mellahi, 2011).
Oligopoly market: In Oligopoly market structure large number of suppliers is there which further impacts the decision of business. In such market place, the business authorities do not possess the right to make changes in prices.
3.2 The ways in which market forces shape organizational responses
In order to manage demand and supply aspects, it is essential for the business entity to consider all the aspects prevailing at market place. In such respect, Iceland supermarket is also required to emphasize on competition aspects so that new products can be introduced at market place. The major aspects that shapes organizational responses are supply and demand aspect as when people demand for more, the business must possess the capability to supply the same quantity so that to satiate them as per the needs. Further, demand from customer increases at the time when people have the purchasing power to buy things (Fraser and Pong, 2009). At the same time, purchase power determines with the elasticity aspects according to the flow of resources prevailing in the economy. Furthermore, the elasticity of substitute products also determines business activities of Iceland supermarket and retail industry of UK is highly integrated with huge number of competitors. The level of competition has been increasing because of huge availability of substitute products. This changes the probabilities of customer switching to other brands; thus Iceland supermarket has to emphasize chiefly on business products and services.
3.3 Judge how business and cultural environment shape the behavior of Iceland supermarket
Iceland supermarket has been operating the business in competitive market place; however different cultural aspects have been considered by the business entity so that customers need can be fulfilled. Political factors have been changing the business scenario of UK and this shapes the internal business activities. At the same time, rules and regulations ought to be considered by the business entity (Fernando, 2011).
The business entity has to give importance to cultural aspects and for that each and every employee should be provided equal importance. Having focused on social and cultural aspects assists Iceland supermarket to manage social support in all the stages.
Economic prosperity of the business has been enhancing because the flow of resources in the economy is appropriate and this manages supply and demand aspects (Craig and Campbell, 2012). This highly shapes the business processes of Iceland supermarket.
Iceland supermarket has to use technological resources on higher extent so that creativity and innovation can be encouraged. Hence, technological factors seem to be supportive for the business entity (Erixon, 2011).
Iceland supermarket has been showing great concern towards the environment and for such purpose; the business has been trying to reduce the amount of resource wastage. This also helps in promoting the value of business towards different customer segments (Gabriel, 2004).
Be able to assess the significance of the global factors that shape national business activities
4.1 Discuss the significance of international trade to UK business organizations
When any company enters in international market place for the purpose of trading with the international business entities; then the process is termed as International trade. This means that the business has expanded its operations in international market place. The companies operating business in UK embarks in international trade because it enhances the scope of acquiring greater profits and as a result, competitive edge can be created (International Trade: Features, Advantages and Disadvantages of International Trade, 2015). International trade seems to be beneficial for Iceland supermarket as that can augment the value of business services and more customers can be attracted towards the same. International trade can create a few issues to the business entities; but it would definitely increase the market share and growth potential. Moreover, Iceland can make huge use of technological aspects by entering into global market place.
The impact of international trade varies as per positive and negative aspects; but chiefly it augments market share of the business entity (Erixon, 2011). If Iceland Supermarket enters into international market, then the business would get the opportunity to bring various products in different varieties to all the other customer segments. This can customer a wider array of choices which will not only improve their quality of life but also it will help the country to grow and prosper more. Further, international trade promotes efficiency in production as countries will try to adopt better methods of production to keep the cost down in order to remain competitive (Elsevier, 2013). It is an apparent fact that having international business can assist Iceland supermarket to generate more opportunities for employment; thus it will help the country to bring down their unemployment rates. Meanwhile, managing international trade can help UK to make optimum use of its natural resources and wastage of resources can be avoided.
4.2 Analyze the impact of global factors on Iceland supermarket
When any business entity enters in international market place, it faces issues related to political, economic and social aspects; thus Iceland supermarket may also face such constraints at the time of entering into new market place. Global forces like policies and strategies of companies can impact the existing work processes and it can also hamper the interest of stakeholders in the business. Retail companies of UK has the potential to enter into international market place since that they have all such products and services which customers prefer to have (Dettwiler, Lindelöf and Löfsten, 2006). More concern is required to be given on competition policies and acts so that healthy competition can be generated at market place without any issue. Hence, it is clear that Iceland supermarket can get numerous benefits from international trade but at the same time it can impact the consistent operations of business organization.
Once such impact of global factors is that Iceland supermarket will have to consider technological aspects highly so as to facilitate innovation and creativity in the business processes. New and attractive techniques needs should be utilized so that productivity of the business can be enhanced. Further, Iceland supermarket can face issues concerned with economic condition of UK because it changes frequently as per the market structure (Mariappanadar, 2012). At the same time, high propensity to import may cause reduction in the domestic savings of the country and this may adversely affect the rate of capital formation along with the process of growth. Under foreign trade, when a country tends to specialize in a few products, job opportunities are generated on higher extent and as a result, it augments economic stability of the country. Foreign trade might discourage self sufficiency and self reliance of Iceland supermarket.
4.3 Evaluate the impact of policies of the European Union on Iceland supermarket
Apparently, European Union is a combination of several policies that delivers wide range of advantages to the customers; however on the other hand, this could this could also lead to consider numerous policies for business management. One of the chief benefits of European Union is that Iceland supermarket has to administer only a single rule in spite of other 27 rules of export. The policies under European Union can also assist the supermarket to augment the skills of the employees; thus more revenue can be accomplished. Similarly, considering the policies of European Union can assist Iceland supermarket to face less issues from legal concerns (Matthews, 2005). Moreover, with the help of EU policies, several organizations can enter in new market with maximum amount of benefit. The policy is also beneficial for Iceland Supermarket as the business can enter into competitive market place without facing many restrictions because European Union allows easy entry and exist process in retail industry (Yu and Ramanathan, 2012).
The European Union is considered as the largest market in the entire world and this reflects that all the concerned of EU can freely conduct business and trade practices throughout other member states. Hence, this can augment the business scope of Iceland supermarket due to significant assistance by IKs membership in the UK. Thus, Iceland supermarket can acquire benefits like reduced or abolished selling tax and freedom from other restrictive fiscal measures. As a result, the retail entity will be able to generate higher profits and it can also operate more freely without facing intervention from government norms and regulations (Craig and Campbell, 2012). Another important aspect of EU membership is that it helps the companies from other areas of the world to oblige the regulations and policies of respective European nations. EU policies have also developed a liberalization of policies and hence many products which were prohibited from being traded can now be freely traded across different EU nations. Thus, on the basis of this discussion, it can be stated that Iceland supermarket have to oblige different policies and norms for adequate business operations (Erixon, 2011).
Summing up the entire research study, it can be said that since Iceland supermarket has expanded its stores across Britain and Ireland; thus according to the business scenario, there are various factors prevailing in the environment that impacts the business decisions of Iceland. The business has been acquiring huge assistance from cultural forces and these aids to retain the customers for longer time span. From the research study, it is evaluated that Iceland supermarket should expand the business operations in international markets as well so that it can create competitive edge over the rivalries. At the same time, it is explored that economic system plays crucial role for all the organizations because it determines the flow of resources in the country. Be able to assess the significance of the global factors that shape national business activities.
Craig, T. and Campbell, D., 2012. Organisations and the Business Environment. 2nd ed. Routledge.
Dettwiler, P., Lindelöf, P. and Löfsten, H., 2006. Business environment and property management issues: A study of growth firms in Sweden. Journal of Corporate Real Estate.
Elsevier, B. V., 2013. Business environment, operations strategy, and performance: An empirical study of Singapore manufacturers. Journal of Operations Management.
Erixon, L., 2011. Under the Influence of Traumatic Events, New Ideas, Economic Experts and the Ict Revolution. Emerald Group Publishing Limited 8.
Fernando, C. A., 2011. Business Environment. Pearson Education India.
Fraser, I. and Pong, C., 2009. The future of the external audit function. Managerial Auditing Journal.
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