Business and Business Environment: PESTLE and SWOT Analysis

This report provides a comprehensive analysis of the Business and Business Environment using PESTLE and SWOT analysis. It highlights the positive and negative impact of macro business environment on the business, interrelationship of internal factors with external factors, and critical reflection of key findings on decision-making process.

BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
Part 2................................................................................................................................................4
PESTLE analysis.........................................................................................................................4
Positive and negative impact.......................................................................................................5
SWOT analysis............................................................................................................................6
Interrelationship of internal factors with the external factors......................................................7
Critical reflection of key finding and how they influence the decision-making process.............8
CONCLUSION................................................................................................................................9
REFERENCES .............................................................................................................................10

INTRODUCTION
The report of business and business environment will comprehensively highlight various
aspects of the business. Different types, size and scope of the organizations will be depicted
using the examples of organization like Marks and Spenser. Also, the interrelationship among
various functions within an organization and how they link to the structure of the organization
will be depicted in detail. Advantages and disadvantages of the various functions will be
illustrated in detail. Further, the positive and negative impact of the macro business environment
on the business will be depicted using vital models or analysis such as PESTLE analysis. Also,
organization's internal environment will be analysed using the SWOT analysis which will
elaborate the weakness and strengths. At last the reflection of key findings will be mentioned
highlighting how they affect the overall decision-making process in the organization. The
organization taken for this purpose is the marks and Spenser which is a UK based retailer having
a large product portfolio.
MAIN BODY
Part 2
PESTLE analysis
This analysis will elaborate the external or macro environment of the business. As there
are several important factors which has high impact on the business. Let's understand each factor
in detail.
Political factors: There are two significant political factors that impact the marks and Spenser.
Free trad policy is one such factors as it has enabled the company to have smooth business
operation across the globe yet the recent move of UK which is popularly known as Brexit has

raised the prices of the goods and imposed various tariffs which has raised the prices of the
goods (Molthan-Hill and et.al., 2020).
Economic factors: high rates of inflation has made the rise in prices of the products which
makes and Spenser difficult to maintain the lower prices as a competitive edge in the market.
Also, high unemployment rates on the economy has weakened the purchasing power of the
customers in the market which affects the revenues of the organization.
Social factors: the recent shift in customers taste and preference has compelled the business of
the organization to take different approach which focuses on offering health conscious products
to the customers. Also, customers are become highly influenced by the trends in the market
which makes business rethink its strategy to stay relevant to the fast pace changes in the market.
Technological factors: retail industry is facing wide range technological advancement in the
market which makes business to invest a large sum in adapting such technological advancement
in the organization such as online selling, atomization of business process, keeping the customer
database etc. it has also given business widen its operations in the market (Sinkovics, Kurt and
Sinkovics, 2018).
Environmental factors: it has become the objective of the company to undertake such measures
which makes business process sustainable. Also, marks and Spenser is trying to maintain its
image in the market as luxury brand which requires company to work in direction of using
organic produce, zero carbon emission, reducing wastage in production houses etc. these things
has capacity to make business efficient.
Legal factors: marks and Spenser being a very popular business organization serving for a long
period. It has made the working culture in the organization such which abide by all legal
requirement of the country as it has wide range of product portfolio which require it to comply
with a lot of rules and regulation by various bodies in the economy (Goslin and Kluka, 2020).
Positive and negative impact
Different macro factors have different impact on the business. The political factors has
negatively impacted the business as company has seen a rise in prices of the products which
makes it difficult for company to thrive on the competitive edge of lower priced goods offering
while maintaining the high quality. Economic factors also has negatively impacted due to the
high cost of raw material caused by the high rates of inflation. On the other hand social factors
has positively impacted the business as consumers are taking wonderful care of their product

consumption and choosing healthy products which are available at the marks & Spenser.
Technological factors also has positively impacted the business by widening the scope of sales
on online platforms and technology has made it easy to bring the excellent customer services and
satisfaction (Vaiman and et.al, 2018).
Environmental factors also has positive impact as it has enhanced the brand image of the
business. e.g. marks and Spenser is undertaking the sustainable business approaches and
reducing the carbon emission which has helped it improves the band image. Legal factors also
has neutral or positive impact as long as company is abiding by the rules and regulations. In case
of any compliance issue there might be a negative impact (Laganakou, 2020). e.g. food authority
of UK comes up with many rules and regulations for the protection of the health of the citizen
and marks & Spencer is constantly undertaking the measures which completely abide by the
same.
SWOT analysis
It stands for strengths, weaknesses, opportunities and threats. Let's analyse the internal or
micro business environment of the business in detail.
Strengths  Marks and Spencer is well experienced organization serving for last
136 years in the market.
 It is a highly recognized brand in the market due to its wide networks
and product offerings.
 It is a multinational company which has business operations online,
offline across the globe.
 Large product portfolio makes customers perceive it as a one roof
solution for their all needs.
 It has numerous designers under the marks and Spencer name which
makes it very inclusive when it comes to product offering.
 It has abundance of resources for the plans and projects due to large
number of projects (Foss and Pedersen, 2019).
Weaknesses  Declining sales is one of the biggest weaknesses of the marks and
Spencer. As it act as a highly negative indicator of the performance.
 Perception of public that Marks & Spencer offers only luxury
products makes it look like an expensive brand which restricts certain

income group people to come to the stores (Fergie, Hutchinson, and
Magee, 2020).
 Poor financial results is another such negative factor of the company
as company is not rapidly coping with the changes that are taking place
in the business.
 High cost resulting from the manual processes makes company very
weak on the edge of competitiveness in the industry due to the manual
process in the organization.
Opportunities  Market segmentation, marks and Spencer has the chance to do the
segmentation on various basis which can enhance the business of the
company by targeting more customers.
 Inclusivity in terms of product offering, being perceived as a luxury
brand it must redo the way it is being perceived by public, it should
make itself approachable and affordable for everyone (Henley, Vorley
and Gherhes, 2021).
 Global presence offline and online, even thou company has global
operation it needs to expand in the countries where it has a low-key
presence. It needs to build itself with prominent online and offline
presence.
Threats  High competition, marks and Spencer is facing high competition from
the various business giants in terms of revenues, profitability and sales.
 Lack of relatability, as businesses are growing at a fast pace in the
market it becomes very difficult for the company tos stay relevant to
the public.
 Automatized business processes which needs a lot of expertise and
resources for the purpose of adaptation in the business of the
organization.

Interrelationship of internal factors with the external factors
Internal factors of the business environment comprise those factors which have the
capability to influence the organization's decision-making, strategies working. On the other hand
external factors are those which affect the reputation, growth, survival and expansion of the
organization. Yet both these factors are interrelated. There exist interrelationship between
internal and external factors of the business (Sinkovics, Kurt and Sinkovics, 2018). The political
factors such as the tax regulations and tariffs on the business increases the financial liabilities of
the organization hence affecting the profitability of the organization which results in to the
weakness of the organization as “poor financial result”. It is a great example of the interrelation
of the external and internal factors.
Further when the market trends are not being coped by the business it ends up being a
threat to the business that has capability to convert into the weakness in the long term. When
marks and Spenser fails to abide by the legal rules and regulation in the nation it becomes reflect
upon the brand image of the organization and such negative brand image leads to the weakness
of the organization. Also, various strength of the company are derived from the external factors
such as taking steps and several measures which has enhanced the environmental compliance
and thinking improves how public perceive the brand (Vahlne and Johanson, 2020). Companies
ability to have large scale resources makes it deliver the best product portfolio offering. Also,
each and every external factors has direct or indirect relationship with the internal environment
of the business. As it is important to have a positive macro environment in order to have positive
micro business environment. Hence, it is very evident that an organization has interrelationship
of the several factors.
Critical reflection of key finding and how they influence the decision-making process
Key findings are the comprehensive sources of deriving the important aspects from the
above analysis such as the SWOT and PESTLE analysis. Various points of consideration are the
different external factors of the business environment which highly impact the decision-making
process of the organization. As, if an organization is unable to carry out the incorporation of the
political and legal factors while launching a new product or policy it will be difficult to analyse
the success of the same. Therefore, decision-making is one such aspect which needs due
consideration of the external factors.

As marks and Spencer is a multinational organization which needs a constant review of
each external factors and how the current state of each such factor affects and defines the internal
strengths and weaknesses of the business (Mreji and Barnard, 2021). When it comes to the
customers taste and preferences it becomes vital to have a grip on each area of working as it
helps in depicting the best approach in incorporating the strategies which can help business
thrive. Further it is quite evident from the report that company has derived various strengths and
weaknesses from the macro business environment and it is the strengths and weakness which
needs to be considered while making a balanced decision.
Many business suffer from the governmental policies and regulations, especially those
multinational organizations which has to carry business operations across the globe it becomes
very important to continuously analyse the political scenario of each country of operation as it
impact the overall performance of the organization. Also, it has been noticed and observed that
an organization's strengths are weaknesses are derived from the external environment which
makes or breaks the overall business decisions. When one thing in the environment of the
business changes business has to decide its next move according to the changes, entire decisions
making process of the business undertakes and understands the macro business environment and
micro environment.
CONCLUSION
The above report has analysed the Business and business environment aspect which are
crucial in the organization. Various types, size and scope of the company will be elaborated
keeping the business examples highlighted. Also, the relationship among different business
functions which plays vital role in the organization building will be elaborated using various
examples. Next in the report, different negative and positive impact of the macro business
environment using pestle analysis has been illustrated for the organization. Also, a detailed swot
analysis has been done which has brought light upon the strengths and weaknesses of the
organization's internal environment. As internal environment of the organization plays a crucial
role in overall business. At last a critical reflection of the key finding which plays a crucial role
in the decision-making in the business has been depicted. The organization used for this purpose
is the marks and Spenser which is a fast growing retail sector organization in UK and currently
operating in more than 50 nations across the globe.

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