Business environment is important aspect which contain ongoing changes in the business to create more awareness. With this regard, opportunities also expanded within the business economy to efficiently develop business operations (Botha, Kourie and Snyman, 2014).
In this context, present study based on Sainsbury which is retail sector business of UK and expanded their operations in different areas of the world easily. They are providing online delivery of different products to attract customers and gain their loyalty as well.
For gaining insight information of the present report, it covers different types of organisation and growth to deal with international business environment. Furthermore, background details, size and scope, etc. of different businesses also develop in international areas to gain more profitability at workplace. Moreover, it includes impact of PESTLE and Swot analysis on the business operations.
1. Overview of different types of organisation and growth of international business environment
In the international business environment, there are different types of businesses operate to gain more growth and profitability at workplace. They are as follows:
- Public company: Public businesses determine their functions and operations that build trust and credibility in a particular group (Hamilton and Webster, 2015). They are also raised awareness towards the enterprise to define, control and distribute message inside and outside the enterprise. Sainsbury is public limited company that determine products and services in different areas of the world.
- Private company: In order to develop more profitability and effectiveness, private companies focus on shareholders profits to create more profits and revenue at workplace. In this regard, they make their growth with expansion of business and increase profitability with value and selling them at a profit (Crane and Matten, 2016). For instance, Asda is private sector company that deal to gain more profits and revenue in the business.
- Voluntary business: Voluntary business consider their operations and functions to gain common interest in the association of business. There are several members in a group who enter in agreement as volunteers in a form of body to accomplish particular business. These types of businesses have no motive to earn profitability to perform only charities function to raise money and awareness as well (Cohen and Kietzmann, 2014). For instance, The National Trust is the largest voluntary sector enterprise in UK which expanded operations and functions to carry creativity in the operations and functions.
- Partnership business: Partnership businesses consider legal operations between two and more than two individuals who share their profits and revenue (Erasmus, Strydom and Rudansky-Kloppers, 2016). Partners also manage company and assume responsibility with appropriate obligations and debts. For instance, John Lewis partnership company continuously work to develop their significant advantages in the country.
2. Explanation of each organisation with include background details of the business, products and services, size and scope, vision, mission, business objectives, legal structure and information of stakeholders
Public company: Sainsbury is retail sector business of UK that continuously work to satisfy customer demand and requirements as per their choice. They deliver products of outstanding quality with great service at competitive cost. Therefore, they have mission to minimise impact from environment and aim to provide good quality of products and services for betterment of society. Business objective of the company is to increase their store in different areas of the world to capture high value of the products and services (Wheelen, Hunger and Bamford, 2017). Legal structure of the enterprise is hierarchical which would be beneficial to create series of levels of people and control on each to gain desired results. Size and scope of the company is also expanded to develop more creative results in the country and many other areas as well.
Private company: Asda possess hierarchical structure to operate in different areas of the world. In this regard, they are trading in British retailer to lead as supermarket and develop their significant advantages in different areas of the world. They provide products such as grocery, general merchandise, financial services, etc. (Foss and Saebi, 2017). Their main aim and objective is to continuously develop operations in different areas with relative planning application to open market with competing several competitors. The company has mission is to create rapid expansion to open large superstores in edge of out-of-town locations and build stores with district centres.
Voluntary business: The National Trust is voluntary business that established their operations in 1985 with aim to look after places of historic interest and benefits of different areas across England. In UK, they are working for the mission to develop trust itself as a charity which works to preserve and protect historical places (Simoes, Singh and Perin, 2015). Trust also founded in 1895 to give statutory powers. Furthermore, they are also working on numerous donation properties to develop effective results. They follow flat structure to communicate and work with government bodies which perform several functions and overlap to build trust in the country.
Partnership business: John Lewis Partnership business also consider their operations with different partners to look upon visionary and successful way to do business. They are always putting happiness among several partners to serving customers with fairness (Grayson and Hodges, 2017). Their vision is to be a successful enterprise which powered by people and principles to define unique results in the business. There are different types of products provided such as clothing, watches, jewellery, furniture, photography, etc. The company has mission to make sufficient amount of profit with trading operations and sustain with commercial activities.
3. Functions for the one organisation with using organisational chart to show interrelation between them
In the enterprise, there are several functions consider that develop successful relationship with other management functions. In many businesses in single department all communication function devoted with several activities (Tukker and Tischner, 2017). Following are different functions and their relationship can be successfully build to attain more desired level of results:
- Procurement and design engineering: Design engineering in Sainsbury considered with technical specification of the business. Therefore, procurement in the business assists to exercise responsibility in effective manner so that supplier involvement also implement to put their efforts in positive consideration. In the chosen business procurement consider relationship with design engineering to initiate prices paid for production material that is related with specification (Belás, Bartoš and Novák, 2014). Therefore, it can be enlarge with several numbers of organisations. It helps to maintain quality, safety and performances of the chosen business.
- Procurement and production: Procurement and production relationship begin with different functions that transmit manufacturing schedule and material for procurement functions. It is subsequently translates according to time to solve most difficult problems that faced by the business (Sodeyfi, 2016). When production not allow procurement as per sufficient time, it is important to develop competition to negotiate properly in Sainsbury.
- Procurement and sales: Procurement also recognise to direct relationship between sales function and profits. In this way, enterprise can overlook towards profitability that assists to promote more desired level of results and promote sales activity as well. Estimation of sales in the chosen business also based on this element include changes in the business and expect in future development (Evans, Vladimirova and Barlow, 2017). Procurement and sales must be wisely blend with interest which developed to understand product quality and organisation profits as well. It increases positive results to develop more significant advantages.
- Procurement and finance: Procurement relationship also successfully develop with finance function. This is because, it assists to determine cost to maintain relationship with planned and ascertained business failure (Roth, 2017). There are basic data needed to create proper planning and schedule to inform certain changes in the business. Prompt payment to suppliers is also key contributor to maintain good relationship with the business goals.
1. PESTLE analysis and impact of positive and negative impact
This is to undertake the PESTLE analysis of Sainsbury and discourse upon its several macro environmental factors affecting their business. Through which, below are few positive and negative impacts-
Political- This includes a rising rate of debts on both UK government as well as the customers that directly influences the consumer’s attitude. Due to which, Sainsbury is also dealing with a high state of pressure onto the business. This depicts a challenging aspect for the cited entity who is continually required to operate in such difficult circumstances (Tukker and Tischner, 2017).
Economical- In UK, their existed an economic recession leading to high rate of inflation and unemployment. Both of these components have negatively impacted upon Sainsbury by decreasing the production level of their food products to a great extent (Becker, Atinc and Spector, 2016).
Social- This factor has shown some positive impact on Sainsbury in terms of meeting the changing taste of consumers. Considering this, they have also launched non-food products to satisfy the demand of getting all kind of products under a single roof, by the consumers.
Technological- It has also depicted an encouraging aspect for Sainsbury with its successful launch of online food delivery to the customers (Aziz, Shahzadi and Rahat, 2017). Also, their yearly reports have assured a constant enhancement in its undertaken services with an improved online sale, that resulted in profits by 25%.
Legal- This exhibited both positive and negative impact on Sainsbury where the changing policies and legislative norms has greatly influenced the company’s performance. It is for example on referring to such a newly introduced tax on advertisements of highly processed foods as well as fatty food products. After which, Sainsbury has smartly adapted this change by modifying the production of such type of food products.
Environmental- Sainsbury together proved itself in terms of being a socially responsible establishment that introduced the approach of “Reduce, Reuse and Recycle” to efficiently manage the waste and undertaking effective practices for recycling and packaging of their goods (Botha, Kourie and Snyman, 2014). This factor is usually concerned about acting in a socially responsible manner, with a principle motive of maintaining a safe and healthy environment and have thus depicted a positive impact on Sainsbury. Are your college assignments taking a lot of time to complete causing you not to focus on other activities? Don't worry, our College Assignment Help UK service would be a great help for you.
2. SWOT analysis
This is to undertake the SWOT analysis of Sainsbury for determining its key strengths and weaknesses and relate the findings with the above discoursed external factors.
- Strengths- One of its key strength is its diversified business having strong coverage of shares in the market. This in turn depicts a strong balance sheet with consistent efficiency in terms of earning profits. It together represents a distinguished food proposition having great quality products and is also considered to be a great place to work with due to a high rate of employee diversity.
- Weakness- Continual switching of brand is referred to be a major weakness of Sainsbury, creating large number of risks. This in turn has presented yet another concerning aspect of retaining the consumers, despite of having core loyalty programs and attractive promotional strategies. Also, rising costs with low marginal profits have added yet another risks in terms of selling online that has also led to lower down the volumes. As a result, to which, Sainsbury is now required to trim down its costs by together offering low priced products by ignoring the level of competition which is not sustainable any more. Also, the concerns related to intensifying cost is in relation to procurement and expenses to bring some key differentiator for attracting the high- income groups as a way of providing a distinct experience of shopping to them. This is for instance to appoint well knowledgeable and educated salesperson that depicts an added expenditure.
- Opportunities- This is in terms of entering into some newer market segments including emerging marketplaces through effective market entry strategies involve partnership and joint ventures. Expansion of business into growing economies such as Asia and Africa also depict a vital opportunity for Sainsbury. Lastly, introducing self-checkout machines to open 24 hr. stores can also boost up its sales to a great extent (Botha, Kourie and Snyman, 2014).
- Threats- A rising globalisation together presents a great deal of challenge for Sainsbury where it is now required to source viable products that are of the best quality.
On interrelating the above carried SWOT with that to the above discoursed external factors, it has been found that Sainsbury’s opportunities and threats are largely affected by the findings of macro environmental factors.
3. Internal and external environment analysis with key findings and how it influences decision-making process
It is on the basis of above conducted Pestle and Swot analysis of Sainsbury to determine both of its internal and external status. From which, the internal analysis using SWOT has demonstrated some vital strengths and opportunities of the cited firm that influences its decision-making procedure. This is for instance on referring to its forte of moving towards a right direction for expanding into newer set of markets. It in turn impacts on their concern of choosing right strategy for entering another marketplace. Another key finding is in context to its inventive promotional strategies where it has undertaken some highly innovative tactics that also surpasses its contenders to a great extent (Tukker and Tischner, 2017). This is for example on considering its Brand Match promotion that represents its positive status in front of its competitors like ALDI and TESCO, etc. However, the decision of changing these strategies on timely basis to meet out the fluctuating market needs is greatly influenced by it. In terms of Sainsbury’s weaknesses, a rising cost has been found to be an utmost concern. For which, the decision making regarding any such added expenditure of adopting supported technology which represents elementary pre-requisite requirements like self-service, spacious passages with multilevel parking, etc. (Botha, Kourie and Snyman, 2014)
Beside this, on referring to the external analysis of Sainsbury, it has been found that a vital opportunity for the quoted entity is to enlarge their stores in remote areas that has shown a rising culture of supermarket. It thereby impacts upon their decisions related to expanding into newer market segments with a scope of growing their existent profits and revenues. However, a rising level of competition depicts to be yet another concerning aspect for the chosen enterprise that influences their decisions regarding the adoption of new and effective strategies to combat the state of competition. Additionally, the above conducted external analysis has shown some severely impacting factors involves increasing level of unemployment and a high rate of inflation. This has led to decline the production of Sainsbury’s food products with a recommendation to expand into developing markets.
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From the above report, it can be stated that business environment consider several functions and operations to develop positive results in systematic manner. With this regard, report summarised about different types of organisation and their purpose, mission, vision, legal structure, etc. Furthermore, report concluded about relationship between different functions of Sainsbury to work in systematic manner at workplace. Moreover, it articulated about PESTLE and SWOT analysis to identify their impact on the chosen business. At last, it discussed about internal and external environment analysis with key findings that influences decision-making process. It helps to take right and effective decisions in the business to develop significant advantages.