Business Environment and PESTLE Analysis

This report delves into the business environment, discussing internal and external factors that influence daily business operations. It highlights the differences between profit, non-profit, and non-governmental organizations, as well as micro, small, and medium-sized enterprises versus large businesses. The PESTLE analysis of the UK retail sector is also explored, identifying the impact of external environmental factors on the industry.

BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
1.1 Differences between profit, not for profit and non-goverment profit Organization.(NGO). 1
P 2. Scope and size of the organizations:...............................................................................2
P 3. Different type of organizational function and structure:.................................................3
P4............................................................................................................................................4
P5. Internal and external analysis of UK Supermarket..........................................................5
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business environment is depended upon the external and internal factor and this factor
affect the various environment like investor, customer, economic, stakeholder, cultural factor and
Technological factor. This Report explains different type of business organization and
environment that are related to the small and large organizational. Large scale organization work
on large projects related information technology, management and cultural related. This Report
giving a comparison between the profit, not for profit and non-governmental organization.
SECTION
1.1 Differences between profit, not for profit and non-goverment profit Organization.(NGO)
Many organization set up their own business and explore all over the world.. These type
of organizations provide the effective services and goods for the people. These organizations
work on multiple areas including technology, product related and retail business (Hillary, 2017).
The non-profit organization are those which will set up for the financial gain. These
companies only focused on public benefits and do not concentrate on their profit. The
organization work on the religious and social based environment. Non-profit organization always
generate the funding and different type of investments, donations etc. and these profit are not to
be distributed among the company member. Non-profit organization always works
independently from the state government.
Non-government organization referred as NGO and it will always be work on the social
activity that is not to be part of any government organization, they have their own identity that
would be classified into two ways.
1. Operational non-governmental organization- These type of organization only work on
projects in which they will filter the project element and developing of the project. This
type of work performs the operational non-government organization (Kew and
Stredwick, 2017).
2. Advocacy non-governmental organization- This organization only work on the specific
type of social related project and that would be helpful for social awareness.
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Business purpose and supply good and services
The organization will provide the effective services and goods. The business can be plays
an important part on how to manage firms and large number of employees works togetherness
organization will be in different size in which the different number of employee participate a task
depend on their capabilities. There are many numbers of employee that will manage the whole
departments. The business is divided into because each department can do work independently.
Operate culture improve the personality of employees and improve their team leadership quality.
There are some important keywords that are helpful to build a healthy and establish an effective
company.
particular Profit organization Non-profit
organization
Non-governmental
organization
purpose In profit organization,
they provide the
effective quality of
product in the market.
They are only focused
on customer
satisfaction. They will
provide the good
services. This type of
organization always
takes funding to banks
and will find the
investors to invest
some money.
Non-profit
organization’s main
aim is to solve
problems of customers
and identified their
general issues
(Mounting and
Vargas-Sanchez,
2018). This
organization do work
not for the profit they
only provide the
customer services.
They are taking fund
from the investor and
revenue generated
from the sales
The non-government
organization will
provide the social
services. They will
fulfill the need of
customers and
improve quality of the
customer. They are
taking funding from
donation and other
local government will
help to provide the
funds for the peoples.
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department.
P 2. Scope and size of the organizations:
There are different type of organization are small scale, medium scale and large scale.
Small scale organizations are very small number of people work together and they also
start their business with small amount of cost. Small scale organization starts their business with
initial stage and giving a lot of jobs opportunity to the people. The source of people income is
also very low.
Medium Scale organization has limited size and they start their business with 20 people.
The company revenue depends upon the industry performance and their profit. The basic aim of
organization to start their business with initial part to gaining the more profit (Magnesia and UT
DIFFERENCES between profit, not for profit and non-governmental organizations (Nos)
Christmastides, 2016). License will require for every company because it essential part to take
permission for the government. Many people are already doing work in UK based company.
Large scale organization is the biggest organization that has many people is working
together. Large scale organization earn more profit because they will do work on many projects
and they will also expand their business in all over the world. This company will provide a
various type of opportunity for the people. Tesco is very big organization that is many people’s
are doing work together in separated department.
Market share, profit share, growth and sustainability in the organization
TESCO is a big organization and their market share 27.8 percent in 2018. The main
objective of this company to earn more profit and more money. This company will provide better
quality of product that is available in the market.
NHS is a non-profit organization and the main objective of this company is to provide
best level of quality services. It is UK based company and gives a health related service such as
medical funding. They will provide the help of customer and giving the best treatment to the
peoples.
EU RAD is non-governmental organization that would develop their country and
providing the opportunities for the people (Page, Ladkin and Hemingway, 2017). They will
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provide drug free medicines and give a free cost of treatment and healthcare because Europe is
always against to the drugs so that they will generate the new policy of treatment.
P 3. Different type of organizational function and structure:
There are divided into two parts:
1. Functional Structure: The functional structure is the part of sales team and marketing
team to manage the whole company functionality. Functional structure aim to cover all
the sales and marketing details of product and it also stored the information of purchased
product. They will maintain the coordination between each department. For example
TESCO is fast growing company in which they can maintain the coordination between
employees. The organization will be trust on the talented people so that they will support
for both personal and organizational growth. Each department doing different-different
task and maintain the system.
2. Divisional structure: these structure used in large scale organization that will cover all
the areas and work on different product. In this structure, the size of organization is very
large so that the scope and cost of the company will also large size in which large number
of employees is doing work in this company. Small scale companies are divisional
structure because they have to do work on small structure.
3. These buyers have the control of market with themselves and they charge high prices
from the customers because the demand of products is more but the supply is only done
by one or two sellers. They do not really care about what the customers are willing to pay
for the products because no competition is available in the market which encourages
them to do so. For e.g. British telecom in Britain, a company having a drug which is not
available with any other company.
Complexities in traditional, international and global Organization structure
TESCO is an organization that would be managing the different type of role of every
business process. They will manage the operations and the functionality of the process but
sometimes they do not allow controlling the business function and operations at international
level. They will not allow taking their own decision so that complexity increased. It will be very
difficult to maintain the complexity due to poor decision making. The complexity will be
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managed on the level of geographical, product related (Hamilton and Webster, 2015). There are
some issues related complexity when the number of employees are not be satisfied on one point
and they have a different-different opinion on particular topic so that the complication are
increased. On other hand knowledge transferred related problems are also faced.
Functions related overall mission and objective in the organization
TESCO has some mission and objective that are to be co-related to each other. Mission of
the company to identify the effective product delivered to the client. They will provide the
effective working culture, good quality of product and each employee treating as a full of respect
they also fulfill the need of employee. These are the essential part of every large organization to
support the knowledge of employee and enhance the skills that are helpful for both
organizational and employee. The company always giving the better development strategy and
also promoting their product. Company leaders performing very important role they highlight the
power of company and giving the strong point of the company. Small company has minimum
employee and minimum capital amount. Small Scale Company can be starting their business
with small area and that will be providing the opportunities of people such as providing the jobs.
Small Scale Company starts their business with low amount.
P4
Political Factor: Political factors are governmental interventions that influence the productivity
and profitability of organisations. UK retail sector is thriving in the country due to agile
governmental policies The company performed retailing worldwide, greatly influenced the
political factors. UK retail sector greatly influenced by political factors of United Kingdom.
Company is playing the great role to gain good opportunities of employees. Product is
demanding in nature, should be increased in the market. The political conditions of the country
are also needed to be considered to ensure that the operations of the businesses.
Economic Factor: Economic factors are which influenced economic policies of content. These
factors are mainly use to concern, for the company. Likely purchasing, demands, profits, etc.
Always, company should be aware of any changes as such as tax policy it could be affected our
financial condition of the company. The company is more interesting to advertise the products
rather than the more luxurious items (Do and Smallbone, 2017). If the sudden changes the rate its
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loss for our company and get effected to the financial condition. Market of UK, the company still
quite dependent it has market share of around 30%
Social Factors: Now a day’s customer has demanding health issues is very high, due to which
their approach towards foods is changing constantly. The changes of products are adapted to
accommodate. The demanding of product is highly rated of the customer and we have to fulfil
their demands according to their wishes. Therefore, the company has increased the number of
non-foods for sale. UK is now mainly named is fat man of Europe.
Technological Factors: The progress in technology has brought various new opportunities for
Tesco Two factors are included for the company to handle easily purchased the products, firstly
is, improvement and introduction of online purchasing with a good facilities for home services.
Secondly, for the customers is easier to do self-service its more convenient. Technological
environment of the country: the change in the technology enhances the functioning of the
operations of the business which results in improvement in the performance of the business and
the profitability of the business.
Environmental Factors: Some natural resources for business are important to use such as,
forest, agricultural products, and sea product. Organisations used renewable resources in order to
reduce carbon emission within the environment. The benefits for society to adopt ways of
operation to addressed environmental issues. The company is decreasing waste produce in their
stores by increasing morality of the customers.
Legal Factors: Policies of the government are directly affectingthe performance of company.
Facilitated, the policy of the company is to reduction of the price for the customer. According to
the amount spent on their market stores (Leigh and Li, 2015). In addition, where the prices are
lower so many stores are there to promote their services. The important of this company business
follow all the rules and regulations and company earn more profits.
P5. Internal and external analysis of UK Supermarket
SWOT Analysis is defined as internal analysis organisation is given below:
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STRENGTHS WEAKNESSES
Tesco is a private organisation which provides
effective quality of products and services.
Strong online presence
Captures all section of customer by provided
food at reasonable price.
In Europe, stores are across 10000
and, employees in stores are 20000
Relatively small as compared to other brands
such as Asda, Tesco etc.
demand of global presence because of few
chains of stores.
Lack of Customer support and care are also
there.
Inadequate Skilled employees and manpower
are there.
weak management, tight regulation in UK
market company.
OPPORTUNITIES THREATS
The company has power potential to increase
number of stores in European markets.
Enlarging growth economics such as Africa
etc.
International enlargement of other brands must
be increase in competition.
Retail chains brands has other price war.
In the retail industry changes of Govt. policies
and regulations
STRENGTH: It helps them to make continous improvements and raise the national economy of
the country. Efficient quality and in prices optimization the Uk super market is provided. Tesco
has a private organisation label and other products of efficient quality (Audzeyeva and Hudson,
2016). Strong online process and online process. Captures all section of customer by provided
food at reasonable price. In europe stores are across 10000 and, employees are across the stores
are 20000
WEAKNESS: A company weakness is to examine or process that business lacks, limiting your
company ability to reach its full potentially. Every entrepreneur has to believe in their work
which is good or not for the company. Relatively small as compared to other brands such as
Asda, Tesco etc. demand of global presence because of few chains of stores. Customer support
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and care are also there. Skilled employees and manpower are there. Weal management, tight
regulation in UK Market Company.
Threat of new entry: UK supermarket has permission threat of new entry. Enhancing the
productivity and profitability he govt. implemented and initiate a new policies that helps is small
and medium size organisation.
Buyer Power: It means our products are in good brands because a customer can have a many
options to buy from the different stores, customers have so many options to choose from other
stores. In UK development of super market consumer power affects the growth (Park, Kwag and
Bae, 2016).
Threat of Substitution: Thus, there is high threat of substitution for UK supermarket industry.
So, many substitution are there of the products it’s very affected to the company. A number of
supermarkets in UK such as Tesco, Leeds. Etc.
Threat of Suppliers: A large super markets industry is there to dictate the price they pay to
suppliers. The quality of goods and services is threatening in the industry to increase suppliers.
The presence of powerful suppliers reduces the profit potential in an industry.
Competitive Rivalry: Powers of buyers to bargaining is the factor of competitive analysis. Is
one of porter's fiver forces to examine the intensity of competition in an industry? In UK a high
level competition supermarkets are there. So many big players are captured the majority of
markets and many new small and medium size retailers are evolving in the market day by day.
Business policy:for the purpose of safety and security in the trading activities of the
business this policy was framed. The free movement of the harmful products was restricted so as
to ensure that the use of these harmful products is reduced.
P6. Strengths and weakness with external macro factors
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In this competitive environment, supermarkets of UK industry has to deal with many political
issues, economic growth, changes in social sites, advanced technology, changes in laws and
policies for environment protections. These all big factors affect the organisational growth and
productivity drastically (Kolk, 2016). Due to rules and regulations, the organisational has
responsibility to provide goods services and products. Some organisational has may to left the
country because in Uk it has become in unstable and many global organisations who have
established their business in UK began to left the country. The company should always know the
all the time strength and weakness. Because it is very important part of the organisation factor.
Weakness is also important part of the company if they know the weakness of can be improved
to the future. This lowers the competitive pressure to an extent. The strength of UK supermarkets
industry is they take to the domestic environment and follow the all rules and regulations in order
to avoid any legal consequence. The economic policies of UK are valuable for doing business
management in the country efficiently. UK supermarket industry is now growing due to agile
policies and legislations. Government of UK appreciate technological power of enhancement and
digital revolutions. In this circumstance, the majority of supermarket in the country have online
presence and began online process goods services and products. In order to sustain in the
competitive environment of UK, the supermarket industry have to follow specific rules and
regulations. Environment protection is the key issue that can be consider by each and every
industry or sector while integrating in UK environment (Brennan and Tennant, 2017). It is high
quality product in this product and services are highly. In the company the skills of employee is
very important to the company it is very useful. Technology is in advanced form Though,
market fluctuations and volatility impacts on the growth and developments of these organisations
but due to efficient employees and effective management (Warwick, 2014). Weakness is high
competition in the work in different countries it is very a weak point to the company.
Substitution production is very weak point.
CONCLUSION
Business environment involves both internal and external which influence daily business
operation of organisation. In this report, described as differences between profit, non-profit and
nongovernmental organisations. In this report, it has been discussed the purpose of business and
supply of goods and services. Furthermore, difference between micro, small and medium size
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and large enterprise has been made. By using PESTLE analysis, the impact of external
environment on UK retail sector has been identified in this report.
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REFERENCES
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Brennan, G. and Tennant, M., 2017. Sustainable value and trade-offs: exploring situational logics
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Warwick, P., 2014. The international business of higher education–A managerial perspective on
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