PESTLE Analysis of Sainsbury's in the UK

This report provides a detailed PESTLE analysis of Sainsbury's, one of the UK's top supermarket chains, considering the political, economical, social, technological, legal, and environmental factors affecting the company. It discusses the impact of Brexit, economic performance, social trends, technological advancements, legal transition, and environmental regulations.

GLOBAL BUSINESS
ENVIRONEMNT

Table of Contents
INTRODUCTION...........................................................................................................................1
Political.......................................................................................................................................1
Economical..................................................................................................................................1
Social...........................................................................................................................................1
Technological..............................................................................................................................1
Legal............................................................................................................................................2
Environmental.............................................................................................................................2
CONCLUSION................................................................................................................................2
REFERENCES................................................................................................................................3

INTRODUCTION
Business Environment refers to all the factors that are internal and external to an
organisation and which have a direct impact and influence on the organisation (Groşanu and et.
al., 2015). Furthermore, it determines necessary changes that influences the working and
management of the organisation. Hence, the report below undertakes a detailed PESTLE analysis
and is based on Sainsbury's, which is one of the UK's top supermarket chains in the UK.
PESTLE ANALYSIS
Political
Within the UK environment, there is a lot of uncertainty which is related towards Brexit,
that has caused a major political shift within the country. The government is currently under
transition period with the EU and the retail sector is working under the EU laws for that period.
Hence, a negative impact is exerted by the government over companies like Sainsbury's as the
future laws are uncertain which refrain the company in forming long term goals for the firm.
Economical
The economic performance of the UK is currently shaken down due to reduction in value
of Pound and high inflation in the market. Hence, this presents a driver for change for the
company as now it would be required to support more jobs and provide its products at an
affordable rate to contribute towards enhancing the standard of living of the company.
Social
The current trends related to retail market is in regards with personalised services as a
reward to their loyalty. Another trend in the sector is of quality goods at affordable pricing. This
drives of another change within the company in context of its future direction. Sainsbury's must
now focus upon providing goods that are at par with customer expectations, along with several
personalised services such as discounts and offers (Bah and Fang, 2015).
Technological
There are several technological advancements that are prevalent within the industry, such
as Artificial Intelligence, Automation and Robotics, that are subjected towards better supply,
logistics and customer services. Hence, the firm must adopt the same through self checkouts,
robotics for queries, as well as AI managed customer relationship management in the future.
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Legal
Currently, the UK is going through a transition period with EU, which imposes EU law
on the retail businesses for a year and then the newly formed policies of the firm would become
prevalent. Hence, this invites the change within Sainsbury's in relation to its existing policies,
which must be flexible in the future to reduce the negative impact of the laws and better
adaptability.
Environmental
The UK government has imposed several laws and regulations for protection of the
environment amidst the global issues like global warming. The impact of this change is high on
the company as it is required to adopt sustainable supply and logistics functions which promote
the growth and protection of the environment (Prajogo, 2016).
CONCLUSION
Thus, it is concluded from the report above that business environment is very essential to
be scanned in order to determine the key influencers and changes within the sector that have a
direct impact on the organisation. Moreover, frameworks like PESTLE analysis helps in
determining key drivers of change and macro environment analysis of the company.
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REFERENCES
Books and Journals
Bah, E.H. and Fang, L., 2015. Impact of the business environment on output and productivity in
Africa. Journal of Development Economics. 114. pp.159-171.
Groşanu, A., and et. al., 2015. The influence of country-level governance on business
environment and entrepreneurship: A global perspective. Amfiteatru Economic Journal.
17(38). pp.60-75.
Prajogo, D.I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International journal of production Economics. 171.
pp.241-249.
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