business and business environment

BUSINESS AND BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION.......................................................................................................................................3
LO1.............................................................................................................................................................3
P1 Different types and purpose of organizations public, private and voluntary sectors and legal
structures.................................................................................................................................................3
P2 Size and Scope of a range of different types of business....................................................................6
M1Analyse structure, size and scope of different organizations link to business objectives and product
and services offered by organisation........................................................................................................8
LO2.............................................................................................................................................................8
P3 Relationship between different organisational functions and how they link to organisational
objectives and structure...........................................................................................................................8
M2 Analyse advantage and disadvantages of interrelationships between organisational functions and
impact upon organisation structure........................................................................................................10
D1 Provide critical analysis of complexities of different types of business structures and
interrelationship of different organisation structure...............................................................................10
LO3...........................................................................................................................................................11
P4 Positive and negative impact of macro environment upon business operations................................11
M3 Apply PESTLE model to support a detailed analysis of macro environment..................................12
LO4...........................................................................................................................................................13
P5 Internal and external analysis of specific organizations to identify strength and weaknesses...........13
P6 Explain strength and weaknesses interrelated with external macro factors.......................................14
M4 Apply SWOT analysis and justify how they influence decision making.........................................15
D2 Critically evaluate the impact of both macro and micro factors upon business objectives and
decision making.....................................................................................................................................15
CONCLUSION.........................................................................................................................................16
REFERENCES..........................................................................................................................................17

INTRODUCTION
Business environment is the integration of all the internal and external factors that helps
the organisation to fulfill the customer’s needs and wants and sustain in the marketplace. It can
includes the various terms of the business environment that can impact the operations of an
business enterprise such as supply and demand, customer expectations, clients, suppliers,
government, innovation in use of technology, changes in economic and political conditions etc.
This report is based on enhancing the knowledge related to the various types of organizations
with their size, scope of legal structure. It also helps in showing the relationship between
organisational functions and to link it with its structure and objectives. It helps in giving the
positive and negative impact of macro environment so it easy to notify the strength and
weaknesses. At last it shows the interrelation of strength and weakness with their external
factors(Belás and et. al., 2015).
LO1
P1 Different types and purpose of organizations public, private and voluntary sectors and legal
structures
Private organisation – It refers to any type of organisation which are operates for earning the
profits and that are not controlled by the government. It includes the example of Tesco Plc. that
is one of the famous superstore in the UK with the motive of earning profits(Aithal, 2016).
 Purpose – The main purpose of operating the business in private sector is supply the high
demands of the products with innovation that can satisfies the customers needs and earns
a high amount of profits. For example- Tesco is operate and run their business to satisfy
the needs of customers and earns revenues.
 legal structure
o Sole proprietorship – It refers to that business organisation in which a person is
the sole owner of earning the profits and bearing the risk. In this one person have
the authority to take decisions for holding the opportunities and reducing the
threats. for example- beauty salon, carpenters etc.
o Company – It is an legal entity that is framing by the group of individual that can
engage in a particular business to earn a high amount of profits and revenues. In

this revenues are divided into the shareholder as per the rules and regulations that
is made by the company. in this if the funds are raises from the general public
than it is called public company whereas if the money is invested privately than it
is called private company.
o Partnership – It refers to that term in which two or more than two persons are
included to form business units and done their operations for effective business.
In this partnership deed helps in setting the rules and guidelines so that profits and
liabilities are divided and shares.
Public organisation – It refers to that term in which business is under the control of the
government and managed by them. The best example of public organisation is UKTV that
broadcast the various shows and news to aware the people(Prajogo, 2016).
 Purpose – the main purpose of this is to thinks for the welfare of the society with the
secondary aim of earning the profits and revenues. in this UKTV is providing the various
shows and news and many other programs to create the awareness in the society and
earns a high amount of profits with customer satisfaction to meet the expenses.
 legal structure
o Center – It is the central body that can regulate and monitor whole operations by
providing the authority to the various other departments to value the every
department functions.
o Local- This legal structure is delegated only for controlling the local community
and their welfare.
o State- This structure is accountable for managing and controlling the state and
follows the orders of the central government.
Voluntary organisation – This refers to that organisation which is working for the welfare of
the country and the society by giving the numerous services and products to the person who
needs them. The best example is Macmillan cancer supports that are a famous care center that is
run under the charity in UK(Prajogo, 2016).
 Purpose – The main purpose of the organisation is to help the people of the society with
the motive of caring not for profits. They help in solving the problems of the society that

are facing fear. Here, Macmillan cancer supports that helps in providing the physical,
financial and emotional supports to save the life of the person.
 legal structure
o Charitable Trust- It refers to those organisation that is managing and
maintaining of funds that are collected from the charities for the purpose of saving
the life of the people in the society. For example – provide support to the society
who needs foods and accommodations.
o Unincorporated association - This type of legal structure helps the society to
achieve the common goal that is beneficial for the public and the community.
Difference between profit, non-profit and not-government organizations
Basis Profit enterprise Non-governmental
enterprise
Not-for-profit
organisation
Meaning It refers to that type of
organisation which is
operating for earning
the profits in this
stakeholders are
interested to invest
money for earning a
high returns with
satisfying the
consumers with their
innovative products.
It refers to that
organisation in which
intervention of the
government is not and
they are legal entities
which are working on
the basis of donations
and trust. In this clubs
and other types of
ventures are included
where people are
included as per their
choice.
It refers to that
organisation which
are working for
welfare of the society
and devote their time
and money for saving
the community. it
includes trustworthy
employees that shows
transparency within
the firm.
Scope This type of
organisation is
working only for
earning profits and
longer sustainability
This type of
organisation is
working for local,
public and global
peoples and ventures
It is operated for not
earning the profits but
for saving the society
and solving the issues
related to them.

in the competitive
world.
to compete their
operations for
common affairs.
P2 Size and Scope of a range of different types of business
Tesco plc- This organisation is a British multinational private enterprise that deals in the various
types of product range like, clothing, foods, home wares etc. to attracts the customers base it is
one of the 9th largest profit making company in UK(Deasy and et. al., 2016).
Purpose – The main purpose of Tesco is to sell the products and services to their customers on a
reasonable price as per the needs and wants of the customers. so that they will attracts the large
number of people who buy the goods.
Products and services – Tesco Plc. deals in the variety of range of products like clothing, home
wares, furniture’s, foods and beverages etc.
Market and profit share- In this organisation there are approx 30000 workers that are working
in the organisation and having a revenues of 6391.1 cores GBP WITH THE 28.4% market share
in the UK.
UKTV – It is the British channel broadcaster company that is fully owned by the BBC studios
headquartered in 10 Hammersmith Grove, London, UK. It is founded in November 1992 by
joint venture with the BBC Company and Thames Television. They offer services by using cable
subscription or the digital satellite(Bah and Fang, 2015).
Purpose- The main purpose of the enterprise is to create and made awareness in the people of
society and educates them by broadcasting shows, news and other various programs.
Products and services – They offers the variety of services related to broadcasting the channels
for creating awareness in the society by their products like Television news and programs with
many other shows.

Market and profit share – The Company having the market share of 7.8% in the total
competitors present in the UK with a collaborative profit with BBC of £ 344.8million. in this
there are 592 employees are working who provides the services to the customers.
Macmillan cancer support – It is one of the British charities that provide the services to the
people like specialist health care, financial supports to the people who are affected with the
cancer. It was founded in 1911 in London, UK(Stott, Stone and Fae, 2016).
Purpose – The major of Macmillan cancer support is to provide the help related to finance,
health care and provide full supports on the basis of emotional, social and practical context. It
helps the cancer patients and full care.
Products and services – It offers the support to the cancer people in the various ways like
providing them financial help, moral and emotional support and provide them specialist so that
they can care about themselves.
Market and profit share – As it a voluntary organisation that is operated by the charitable trust.
It contains the revenue of 21.84 Corer GBP. It includes the 125000 people are connected and
working with this trust who help the society people.
Difference between small, medium and large organisation
Basis Small enterprise Medium enterprise Large enterprise
Size and scope This enterprise having
less then 50 workers
with a maximum
turnover of € 10
million in whole year.
The size of this
enterprise is around
250 employees with a
profit of € 50 million
in the financial year.
The size of this
organization is more
than 250 employees
who are working
within an organisation
with a profit of having
€ 2 billion.

M1Analyse structure, size and scope of different organizations link to business objectives and
product and services offered by organisation
From the above explanation it is to be analyses that the different organisation has
different limitation and opportunities of working that helps in earning the profits and gaining the
advantage of business objectives. An business firm is related to various activities that helps in
achieving the growth and maintains the structure of the company. In this Tesco has large size and
scope business having the variety of products range that helps in earning the business objectives
of earning the high profits with their products and services. Whereas Macmillan is a voluntary
organisation that supports the cancer people and fulfill their objectives by supporting the people
and maintain the funds. in this UKTV is the government owner enterprise having the main
business objectives of welfare of society with profit earning by their selling their products and
services like TV programs, shows etc(Saleem, 2015).
LO2
P3 Relationship between different organisational functions and how they link to organisational
objectives and structure
Organisational structure refers to the structure that helps in creating the framework of the
activities within the company which can direct for achieving the goals and objectives of the
firms. It includes the various activities like roles, rules, policies and responsibilities and
determines how the information can flow within the various level of organisation. In terms of
Tesco, organisational structure helps in achieving the objectives from maintaining the proper
structure between the various functional areas that can be shown below(Khan and Quaddus,
2015).
 Hierarchal structure – It refers to that structure where all the employees are working
within under the supervision of one superior manager or the owner. in this all acted as a
subordinates that shows the chain of command from top level to bottom level. It is very
easy to allocate the task, roles and responsibilities to the employees so that objectives can
be achieves in a timely manner. In context of Tesco they follow a Hierarchal level of
structure that helps in maintaining and managing all the activities so that objectives can
be achieved in an effective way. In this structure Tesco generally follows the flat

structure that helps in achieving the target in time because of no delay in the decision
making(Monroe, Rikala and Somervuori, 2015).
 Divisional structure- it refers to that organisation structure which is divided into small
divisions so that task can be allocated as per the skills and abilities of performing. It can
be made in the firm to divides the groups into various different sections and became an
isolated. It is very helpful to achieve the target and earns earn high profits that is one of
the major objective of the business(Virglerova, Dobes and Vojtovic, 2016).
Interrelationship between different organisational functions
It is significant to interrelation all the functions within the business enterprise to earn a
high profits and maintains the brand image in the marketplace. This helps in achieving the
organizational goal within a specified time period. In terms of Tesco it helps in integrating all the
activities to reach the targets in this various functional area involved some of them are explained
below(Lu and et. al., 2015).
 Marketing and research department – In this research department of the Tesco can
research the whole market so that they can understand the demand of the products to
earns a high amount of profits in this marketing department can promote their products so
that they attracts the large based of customers in a wide range in this Hierarchy level
helps the more because they only listen the orders of one non other person this will helps

in clearing the thoughts and satisfaction level. Due to this objective of the company can
be achieved in a timely manner.
 Human Resource and Finance department - In this department of the finance of Tesco
can make a budget and maintain all the financial resources so that HR manager can use
this budget to hire the new candidates or encouraging the old one so that company will
earn the profits and accomplish its task in an effective manner and stay in the market for
a longer term. in this organisation structure helps the more because of its effectiveness
task can be done in an appropriate manner and goals can be reached.
M2 Analyse advantage and disadvantages of interrelationships between organisational functions
and impact upon organisation structure
By using the above explanation it is to be notify that they interrelationship between the
various functions can impact the organizations in two ways i.e. positive and negative way. In
positive terms it helps in maintaining the collaboration between the employees so that they can
share the knowledge and research to the other employees because of this they stay long with the
company. In this structure managers of the organisation can focus on taking the decisions
affectively. It also impact in a negative way that it reduces the connections with the top level
manager and create conflicts between the employees it also weakening the connections this will
create conflicts among the employees because of this delay in achieving the task (Alsaad,
Mohamad and Ismail, 2015).
D1 Provide critical analysis of complexities of different types of business structures and
interrelationship of different organisation structure
It is to be critically analyses that the there are various complexities in different business
structure as in sole proprietorship type of business there are one person who can holds the
responsibility of earning profits and losses in this there is less complexities are present and they
flows a flat structure where only boss can regulate the orders for achieving the targets. In private
organisation there are various complexities present in the working environment and all it related
to micro and macro factors. That many rules and regulation imposed by the government etc. all
this affect the business and its structure but it also helps in attracting the large base of customers
by research the market.

LO3
P4 Positive and negative impact of macro environment upon business operations
PESTLE ANALYSIS refers to the strategic tool that includes the various aspects which helps
in showing the macro environment and their impact on the business of the Tesco. Pestle analysis
can be shown below(Groşanu and et. al., 2015).
 Political factor - This includes the government interventions and stability in the country
that can impacted the business and its operations. in terms of Tesco, this factor can be
effected on two ways.
o Negative impact – For Tesco, increasing import duty create a negative impact for
the business as it enhances the cost of manufacturing because they are importing
form the other countries due to this it is costly for the company.
o Positive impact – Because of tax dismissal by the country Tesco can enjoy the
benefits from that in a way the consumers does not pay the high price of goods
because of not paying the tax. This will attracts the people to buy more.
 Economical factor – This factor includes the inflation rate, GDP, growth rate of the
country etc. This factor can affect the Tesco Plc in positive and negative way that can be
shown below.
o Positive factor – As Tesco is the worldwide recognition and because of this it
enjoys the opportunity of wide range of products that helps in diversify the
organisation in different countries and due to this it will enhance the country
economic.
o Negative factor – Because of increasing the regular salary rate in the country that
negatively affects the Tesco financial resources as it will increases the expenses as
compared to profits.
 Social factor – This factor includes the values, customs, beliefs and various regions that
help the company to enhance the profits and attracting the customers by satisfying the
demands of the society people.
o Negative factor – This factor negatively affect the business enterprise because of
constantly change in the demand of the customers and their consciousness
towards their health.

o Positive factor – Because of growing and enhancing the market in various
locations it helps in attracting the customers from wide range and due to proper
supply chain it will lead the market(do Rosário Cabrita, and et. al., 2016).
 Technological factor – This factor is very trending in the today’s world because people
are attracting towards the advanced technology this will benefited the company like
Tesco to earns a high amount of profits by attracting the large base customers in different
locations and it also helps in supply the goods and services.
o Positive factor – Tesco can use high technology like RFID so that it is easy for
the people who buy products in a payment process. it is very convenient and easy
to use that save the tine of customers due to which they attracts.
o Negative factor – This factor affect the Tesco financial resource as use of
advanced technology can make more investments due to this expenses are
increases.
 Legal factor – This factor shows the laws and regulations that is imposed by the
government. it will impacted the Tesco in positive and negative ways.
o Positive factor – Because of using proper laws by the Tesco it will enhances the
profits of the company and also helps in enhances the brand image with employee
retention.
o Negative factor – This will negatively impact the Tesco sales and image if they
could not follow the proper rules and regulations.
 Environmental factor – It shows the environmental act that is follow by the companies
and it is imposed by the government for securing the environment.
o Positive factor – This factor is positively affecting the Tesco sales as they
prevent to use the plastic bags that harm the environment. In this customers can
attracts towards it.
o Negative factor – This factor negatively affect the Tesco because the use of eco
friendly techniques in the operations of the company cost will be more(Grigore
and Drăgan, 2015).

M3 Apply PESTLE model to support a detailed analysis of macro environment
In this report PESTLE analysis can be a effective tool to analyse the whole business
environment it helps the Tesco to know the abilities and capabilities of earning opportunities and
threats. in this political and economical factor can helps in showing the intervention of
government and the stability of the economic in the country so that they can benefited to create
the opportunity for the firms. In this social factor shows the demographics and geographic
aspects that help in attracting the customers and earning the profits. Technological factor is the
current and effective tool that helps the company new heights. All this frameworks helps in
achieving the targets.
LO4
P5 Internal and external analysis of specific organizations to identify strength and weaknesses
SWOT ANALYSIS OF TESCO
STRENGTH WEAKNESSES
 The major strength of the company is
that it is one of the largest British
grocery stores in the UK that will earn
high amount of profits.
 It is the largest seller of the various
product range such as food, cloth,
furniture, baby wears, home wares
etc(do Rosário Cabrita, and et. al.,
2016).
 the major weakness of the Tesco is the
credit selling of products and services
due to this it face the liability.
 Another weakness is the low pricing
strategy that negatively impact the
profits.
OPPORTUNITIES THREATS
 The main opportunity of the Tesco is
that they can make the strategic alliance
that will helps in beating the
competitors in the marketplace.
 another opportunity is to use the
advanced technology to expand the
The main competitors of the firm are creating
the major threats like Sainsbury’s, ASDA.

business worldwide.
SWOT ANALYSIS OF ASDA
STRENGTH WEAKNESSES
 The major strength of the company is
the use of online and offline market that
helps in earning more profits.
 The major weakness of the firm is that
they are not operating their outlets
globally.
OPPORTUNITIES THREATS
 The major opportunity of the ASDA is
to earn the market share by using joint
venture.
 Changes government regulations affect
the ASDA profits.
P6 Explain strength and weaknesses interrelated with external macro factors
PESTLE Strength Weaknesses
Political The major strength in the
political factor is the tax
dismissal so that Tesco can
enjoy the great opportunities
in the market by expanding
the range of the goods
offered(Armeanu, Istudor and
Lache, 2015).
This factor can affect the
import and exports of goods
majorly importing of products
because of high operation
cost.
Economical Strategic partnership planning
helps in providing the various
solutions to solve the issues
related to customers.
Labor cost increases is the
major weakness in the
economic terms.
Social The positive factor is that the
demographic and geographical
areas where Tesco can sales
their products and enjoys the
In this customers are enjoying
using organic products due to
this firm may reduce the sales
and this will affect the overall

large amount of profits. profits.
Technological Advanced technology creates
the new opportunity of
expanding the market and
enjoys the profits in the
marketplace.
High cost involves in the
technology research included
the maximum cost.
Legal Use of proper law related to
employee safety helps in stay
in the market.
Because of high credit
purchase of goods it will
decreases the proficiency.
Environmental Use of RFID technique to
secure the profits of the firms
and saving the environment.
this also maintains the level of
trust of the customers.
Because of using the
environmental friendly
techniques reduce the overall
cost of the Tesco.
M4 Apply SWOT analysis and justify how they influence decision making
It is very effective to apply the SWOT analysis of the company because it helps in taking
the decisions that are helpful in achieving the targets and earning the profits. Knowing the
strength and weakness helps in focusing on strong the strength by regular practicing on them or
reducing the fear of threats.
D2 Critically evaluate the impact of both macro and micro factors upon business objectives and
decision making
It is to be critically evaluated that the macro and micro environment have create a major
impact on the decision making related to the expansion of the profits and revenues of the
company. This helps in giving the knowledge related to the competitors present in the market
and the demand of the products and services that the customers needs so that they can produce
according to that. It also helps in using the advanced technology by proper research the market
so that large base of customers get attracted(Gradl and et. al., 2017).

CONCLUSION
From the above report it is to be concluded that analyzing the business environment is
very important to sustain in the market and to attract the customers with satisfying their needs
and wants. In helps in giving the knowledge related to the public, private and voluntary
organisation and its abilities and capabilities of doing a business and earning profits. It helps in
examine the all the macro and micro factors that helps in knowing the impact of the business
with the helps in PESTLE analysis and SWOT analysis. It also showcases the interrelationship
between the departments so that it helps in maintaining the structure if the firm and earns a high
amounts of profits(Buno, Nadanyiova and Hraskova, 2015).

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