P1 Explaining the different types and purposes of the company

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
P1 Explaining the different types and purposes of the company...........................................1
P2 Explaining the size or scope of the different types of organisations.................................3
LO 2.................................................................................................................................................4
P3 Explaining the relationship between different organisational functions and how they link to
the organisational objectives and structure.............................................................................4
LO 3.................................................................................................................................................6
P4 Identifying the positive and negative impacts the macro environment has upon the business
operations...............................................................................................................................6
LO 4 ................................................................................................................................................7
P5 Conducting a internal and external analysis of Tesco in order to measures their internal
environment............................................................................................................................7
P6 strengths and weaknesses interrelate with external macro factors...................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is the dynamic in nature, that means its keep on changing every
time as per the needs and wants of the organisation goals. Business environment is the sum total
of all external and internal factors that affect the business function in different manner. There are
several factors which affects the business activities such as political, environmental, economical,
legal, technological etc. Present study will be based on business and business environment in
order to meet out the company objectives and goals. Besides, it also engage the different
activities related the business environment. For this present study based on Tesco which is the
retail business company in UK. Tesco deals with different forms of products and services.
Further, study will be explaining types of purposes of different organisation public, private,
voluntary sectors and legal structures. Besides, report also describing the external or internal
operations, supported by specific examples.
LO 1
P1 Explaining the different types and purposes of the company
There are different types of businesses are present in the business environment which
sales product or services at different costs (Apăvăloaie, 2014). Besides, different kinds of
businesses and purposes will help individuals to perform different functions and long lasting
effective outcomes. Private company may also refer to corporations that does not belong to the
state. The main purpose of the company is to accomplish the aims and objectives and earn great
profit. There are explaining different kinds of business sector under which they run the profit
organisations with different objectives.
Private : Private companies are generally those organisations which is not associated or
connected with government (Barkauskas, Barkauskienė and Jasinskas, 2015). Private company
own run their business activities according to their own choice. Private companies are restricted
to transfer its shares and limited number of its members are only 50 excluding the members who
are or were in the employment of the company. Private company hold limited number of
shareholders (Belás and et.al., 2015). Private company main purpose is to get earn profit revenue
by offering different innovative or creative services. Private company main purpose is to get earn
profit revenue by offering different innovative or creative services. Some of the example of
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private companies are Dyson, Virgin Atlantic, JCB, , Green energy etc. In order to meet out the
best outcome results and better forming services as well. Legal structure of the Private sector is
that, they does not follows the legal implications of government. It is the free organisation who
runs their business at their own level.
The main purpose of this companies are just to make profit and brand popularity.
Besides, these companies also offers high prime cost products which sometimes not affordable
by the lower of middle class families (Bhatnagar and Budhwar, 2018).
Public : Public limited company Plc is the legal designation which is related, public
company has to followed the legal implication of government and run according to their
implications. Public company is based on to protect the interest of customers. Public companies
generally focused on the customers and produce cheaper prices of product or services. The main
purpose of public companies is just to full fill the needs and wants of the all kinds of customers.
This generally focused on to middle or lower class customers. All these types of the company fix
the best prices of results and goals. Public companies are always concern with the customer
needs and wants and provides product or services at affordable prices.
Public companies needs to followed the legislations of the government and does not take
decision by their own. This sector having involvement of the government.
Voluntary : Voluntary organisation is the another kind of business which is associated
with the kinds of services and growth in order to meet out the goals and service outcomes.
Voluntary organisation neither public or private. It is a non profit organisation who offers
services for the protection of social welfare (Crane and Matten, 2016). It affects the long term
goals and best target performance in order to meet out their basic needs. NGOs made up from
some people, group who funded their capital from donation and charities. Some of the examples
of NGOs are Partners in Health, Oxfam, International Rescue Committee etc. some of them are
associated with government or some of them run by their own level.
Legal structure of voluntary is the they might be adopting instructions of the government
or not be.
On the basis of above described three most essential sectors that helps customers to full
fill their needs and wants (Epifanova and et.al., 2015). All kinds of business sector earn different
kinds of profit. Some of them are hold by individual such as sole proprietor or some runs
business by group of some members in a partnership. Etc.
2

P2 Explaining the size or scope of the different types of organisations.
Different kinds of businesses have their own objectives and targets and also they deals
with different kinds of goods and services. It depends upon the type of organisation that what
kind of business they wants to run. Here, presenting the range of legal structures associated with
different forms of business such as sole traders, partnership and private limited companies.
Besides, it also present their scope and size of that particular business.
Types of business Scope Size
Micro In order to meet out the best
goals and services in order to
meet out the best growing
performance goals.
Micro businesses based on
small level who own by
individual with limited
resources. There is not
required of any other
employees.
Small Small is the another kind of
business which full fill the
needs and goals which is based
on small level (Erasmus,
Strydom and Rudansky-
Kloppers eds., 2016). It also
consist limited members.
It is also having small or
limited size of the business for
example of better form of
results. No requirements of
employees.
Medium Medium scale business based
on limited scale which is
effective long term. Medium
scale business main purpose is
to covers all their cost or
expenses from the earning
profit.
Medium scale business size is
limited by just only 20
members. Required less
number of employees.
Large Large businesses based on
large level who main purpose
is to earn profit by offering
Big organisation generally
based on big level which size
also is big where number of
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premium size services or
products (Hair Jr and et.al.,
2015).
employees work together in
proper manner. Required high
range of number of employees.
Range of legal structure which is associated with different forms of business
Private : Private companies are often small privately held business entities whose
liability is limited to some extent. Besides, private companies main aim is to keep focused on
the development areas and goals. Private company cannot sale their share to the public. In UK
there is no minimum capital required to set up the businesses.
Public : Public limited company is been associated with government.Public company
should need to be very much aware. They cannot rise the prices without taking concerned by
government. They should not sale services at high cost (Kew and Stredwick, 2017). Public
company can easily trade their shares in the market for public.
Sole Proprietor : Sole proprietorship is a legal set up where the business handle run by
single owner. Business owner has legally separate from the business and they are responsible for
their own liabilities are assets and also they accountable for all its profit or loss. It has unlimited
accountability for any losses and debts incurred by the business (Knežević Cvelbar and et.al.,
2016).
Partnerships
Partnership are business enterprises owned by two or more parties. Partners of the
company is equally liable for loss or profit. Small businesses generally adopts partnership
business to enhance business growth as well as profit margin.
On the basis of big long-lasting results it helps to make the best growing performance. As
per the size or the scope of the different types of business goals as per the ideas. Due to several
changes within the business it makes demand and supply more flexible and unstable (Kolk,
2016).
4

LO 2
P3 Explaining the relationship between different organisational functions and how they link to
the organisational objectives and structure.
Every business organisation having different kinds of business functions that helps
businesses to grow in to more frequent manner. Sales, marketing, financial, human resource all
these kinds business function together fulfil the company objectives and goals (Van Wormer and
Besthorn, 2017). Moreover, it helps to keep several activities alive and sustaining the best
outcome results and growth. There are presenting some essential role of businesses that helps to
full fill the company objectives and goals.
Marketing functions
Marketing functions is the most essential function within the organisation that helps in
increasing sales of the product. Marketing function initiates the activities through which
customer get to know about the new product or services. The role of the marketing is to promote
the company product or services into best possible manner. (Bhatnagar and Budhwar, 2018).
This overall functions of the marketing helps to accomplished the needs and wants. Market
department has to connected with another to take the feedbacks of any other requirements.
Human Resource function
It is the another function of the organisation which is most distinct and required to
maintained the good staff members. HR manager is accountable for several activities such as
recruitment, selection, training and development etc. it helps to make good team within the
organisation. The main function or the purpose of the HR is to enhance the employee
performance towards the accomplishment of organisation goals and objectives (Epifanova and
et.al., 2015). Human resource department is the most required and essential department that
connects all departments together and collect all information from all the other departments to
generate employee planning and training session. HR department been connected with different
other departments as well to make sure is there any avail of any team member or not.
Finance department
Finance Department is the most distinctive department of the organisation that concern
with the availability of the funds in the organisation. Finance manager always make sure that
funds has always be there in any kind of uncertain situation. Besides, the role of finance
department is to full fill the company basic or large requirements as well. Financial department
5

interrelate with some other departments such as operational department to purchase some daily
essentials, and marketing departments to collect some more different marketing activities plans.
(Hillary, R. ed., 2017). Another role or function of a finance department is planning, organising,
auditing and accounting. This department also connected with the other functional areas within
the company in order to ensure any requirements or not.
Another some common objectives are survival, increasing sale, profit maximizations,
satisfactory customers and growth etc. In order to full fill all those objectives HR, finance,
operations or marketing functions would help to accomplished all those objectives within the
organisation (Kolk, 2016). In order to meet out the best growing results and fast making services
and growth.
It also helps to make the long term targets and better growing performing all the
functions of the business would help to full fill the overall objectives of the company.
On the basis of above section, it has been described that, how business other functional
apart from that it helps to make over the new managing effective business and best effective. It
has been discussed different functional activities of the organisation. It affects the business
organisation (Epifanova and et.al., 2015).
LO 3
P4 Identifying the positive and negative impacts the macro environment has upon the business
operations.
Business environment consist two factors that affect the overall business activity such as
internal or external business environment. Macro factors related with the external environment
that includes political, economical, environmental, Social and legal factor it helps to accomplish
the business objectives also affect the activities of business goals.
Political : Political factor is the initial external environment that affect business
environment by changing in the position politicians take on issues. Political factor depends upon
the government stability or government that support for businesses. Positive impact would be
given by the government like receiving grant from government to expand the business activities.
Contrary, negative impact from government is increasing the tax rates or any other political
issues.
6

Economic factor : Economic factor is the another factor that affect business environment
either in positive or negative manner (Belás and et.al., 2015). Economic factor get influenced by
economic situation, inflation rate, unemployment rate etc. On the other hand, positive factor
would be economic situations on the company. If Economic stability of the country is good
company might be taking new and effective growth decisions, on the contrary if company would
failed to accomplish the results it gives less effective growth purpose.
Social factor : it is the most significant factor that affect business if company fails to full
fill the social needs or wants. In present scenario society wants healthy product or services,
environment that helps them to live life happily. Company needs to make sure that they invest
some amount of funds for the social welfare in order to get good image in the market and
goodwill as well. It helps them to make the good impact on the society. If Tesco fails to full fill
or their CSR rights they will be not able to get good image from the market.
Technological factor : Technological factors are in order to meet out the best outcome
results and make the best outcome results (Hair Jr and et.al., 2015). Technological factors are the
most beneficial for the companies to adopt tor getting more customer attraction. Besides,
Technical expansion expands the business opportunity and make the best outcome results.
Overall, organisations needs to adopt the all required new technologies in order to enhance the
efficiency level of business function to get better quality outputs.
Legal factors : Legal factors of the business external environment generally affect
business into most badly manner if the company fails to adopt company laws or any other laws
imposed by the government (Hillary, R. ed., 2017). It affects business by changing the laws of
employment, contract, or taxation laws. It is necessary for the organisation is to adopt all
required laws and regulations which is necessary for the company to adopt. Positive impact of
legal factor is to having sometimes good policies interns of business profit.
Environmental factors : this factor defines the importance of environment in terms of
unhealthy radiations and chemical used by the companies. Environmental factors must be
concern for healthy environment that must be adopted by the company. In order to select the best
effective and making new managerial skills and growth. Moreover, the macro environment
analysis will how changes in the environment will impact on the business industry. Environment
provides different scope
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LO 4
P5 Conducting a internal and external analysis of Tesco in order to measures their internal
environment.
Macro environment gives the negative impact on the overall business environment that
affect the business into positive and negative manner. On the other hand, company also needs to
analyse the internal environment of the business in order to analyse the and make the best
outcomes and long term process of leading goals (Hoogendoorn, 2016). In order to analyse the
internal environment of the business, it has to be used SWOT analysis model to measure the
company internal strength, weaknesses, opportunity or threats
SWOT is an Acronym used to describe the particular strength, weaknesses, opportunity
and threats that are strategic. SWOT represents an organisation's internal situation in order to
take some new technical measures and developing plan action goals. Moreover, it helps to make
the best outcome results and make the best outcome results (Van Wormer and Besthorn, 2017).
Internal factors generally focused on the internal factors to certain or find out some more new
advantage for the company.
Company must watch effective and better goal or services to make the working
environment more productive or effective.
Strength
Tesco is the most popular retail chain in UK which deals with so many other words and
goals. Besides, the main strength of the company is their brand awareness among customers. It
plays the leadership position in the UK with effective online operations. Company itself is most
competitive and good at product or services. They having one tool to collect customer effective
information tool that is club card. Company also having variety of product or services which is
benefited for the company to adopt.
Weaknesses
Weaknesses of the TESCO is weak Financial performance due to which sometimes
company fails to adopt the latest technology to grow the business efficiency level. On the other
hand, due to misshapen in 2015 company would have been facing lots of down market image in
front of their customers. Tesco dependence are highly on the UK market which limits their
popularity growth. It affects the business growth and restrict company to get new further
8

opportunity and growth. In order to meet out the result outcomes it makes some new challenges
and market opportunity goals (Hoogendoorn, 2016).
Opportunity
Opportunity tool to analyse the internal environment can affect the business growth in
order to affect the positively. Opportunity can give success to the business. It makes the business
more enlarging and growing the business developing goals. Opportunity goals can more helpful
for the business to make the best outcome results. Tesco have chance to take its business in
international market by adopting some productive expansion strategy. Enhancing the
effectiveness of the marketing strategy would also giving long term challenge and facts.
Company also have increasing non food retail range for their potential customers. It also affect
the business (Crane and Matten, 2016). For company there are so many opportunities are there
such as expansion of business, adopt new product line, connects with other brand etc.
Threats
Threats of the business can affect the Tesco into negative manner. Besides, Tesco have
some following threats such as Inability of the new leadership to turn over the business, inability
to sustain cost leadership competitive advantage (Barkauskas, Barkauskienė and Jasinskas,
2015). Due to high fluctuations in currency rates it might be affect the overall business
performance. Business also contains some ineffective targets such as emergence of new ethics
related problem. Overall, it brings new services and growth. Threats of the company is new rival
companies in to the market, change customer demand, lack of finance resource etc.
P6 strengths and weaknesses interrelate with external macro factors
Strength and weakness of Tesco interrelate with the external or macro factors.
Strength with macro factors
Strength of the company is high awareness of the product. Customere awareness relates
to technological factor. If any organisation want to achieve goals with applying new technologies
than it is all about the customer awareness and branding of the organisation because if customer
awareness of the organisation is strong then it is easy to think about innovation or invention.
Innovations always make profitable to the company because it is the thing which likes by the
people. Tesco can develop the existing products with approach to the customers. Tesco has
already used the technologies like paperless, cashless with online transaction, data base
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management system which through it can run the business smoothly. Internet is now taken
common place in retailing business.
Tesco has one of the largest supermarket in retail sector. It considers as most profitable
supermarket in the world. It is the strength of the company which correlates with the economical
factor of macro environment. With earning profitability Tesco make its contribution in the
economic development. Tesco spread in a wide area and it has networked in all around the
world. Every single day comes with innovation and in it Tesco make its stability to face all the
competition. If a company gain much profitability then it is also fair for the country because a
company which increase globally, make their contribution in development(Aghazadeh, 2016).
Tesco also interrelate with the social factor. Its store format appeal to local and cultural
need and it is profitable for social environment. Tesco also concentrate on quality products with
take care oh health issues so it is also profitable for the customers who are living in the society.
Many of customers are quality conscious and many of health conscious and Tesco complete
their needs which attach with the product.
Weakness with macro factors
Weakness is also interrelates with social factor of macro environment. Tesko make its
product with good quality but they are costly and a middle range people can't purchase the
products due to high cost. Many of the customers are price conscious and they give preference to
price, they are not clear about the quality, they only focuses on price so the price factor involve
in the social factor. It is not affordable by the people who belongs to middle class or ow class
family. Tesco only focused to create competitive advantage so it is the weakness of people. Food
prices are increase all around the world so it is threat for the organisation because high range of
food no purchased by the normal people and if the raw material is high then what the
organisation also do.
Some retail chain not performed well in a few countries. It is about economical factor.
retail chain management is important for any organisation but in case of Tesco in some
countries there stores and supermarkets not performed well, that means not liked by the people
due to price crises. if the stores are not affordable to make competitive advantage the also make
an impact on the economy of the country. It affected by legislation and tax rates. without earning
what an organisation do and how to pay to nation(Kopnina and Blewitt,2018).
10

CONCLUSION
From the above study it has been summarised that there are different type of company
public, private and voluntary. Each one had their own legal structure. Other types of industry
were micro, small. medium and large with their different size and scope. Different department
which interrelated with each other in the organisation and it has found that they all department
directly or indirectly linked with each other. They all run in the organisation with the help of
each other. This file has been summarised factor with positive and negative impact on the
organisation. Strength and weakness of the organisation which was interrelated with the external
micro factors and through this the organisation made opportunities. Found that strength of the
organisation could use it in the welfare of the organisation.
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