Nestle's Business Environment Analysis

This assignment requires students to analyze Nestle's business environment, both internal and external. Internal factors include employees, products, management, and regulations, while external factors encompass customers, competitors, suppliers, and promoters. The analysis should evaluate how these environmental elements influence Nestle's operations, product quality, and overall market standing.

BUSINESS
ENVIRONMENT

Table of Contents
BUSINESS ENVIRONMENT........................................................................................................1
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Identify the purposes of different types of organisation.......................................................3
1.2 which an organisation meets the objectives of different stakeholders..................................4
1.3 Explain the responsibilities of an organisation and strategies employed to meet them........5
TASK 2............................................................................................................................................5
2.1 Explain how economic systems attempt to allocate resources effectively............................5
2.2 Assess the impact of fiscal and monetary policy on business organisations and their
activities......................................................................................................................................6
2.3 Evaluate the impact of competition policy and other regulatory mechanisms on the
activities of a selected organisation.............................................................................................7
TASK 3............................................................................................................................................7
3.1 Explain how market structures determine the pricing and output decisions of businesses. .7
3.2 Illustrate the way in which market forces shape organisational responses using a..............8
range of examples......................................................................................................................8
3.3 Judge how the business and cultural environments shape the behaviour of a selected
organisation.................................................................................................................................9
TASK 4..........................................................................................................................................10
4.1 Discuss the significance of international trade to UK business organisations...................10
4.2 Analyse the impact of global factors on UK business organisations.................................11
4.3 Evaluate the impact of policies of the European Union on UK business organisations....11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment is refers to internal and external environment of business in which
include customers, supplier, employees, products, competitors, management, supply and demand
that affecting on business development in the systematic manner. Business environment help to
develop a healthy environment in the organization so employees will do their own work
effectively and achieve goals and objectives. Business environment relating to the internal and
external factors that may be affecting on negative and positive manner. In the internal
environment including employees, objectives, management, rules and regulation those are
decided by the company's head that have to follow by all the employees for get success in their
business life, external environment include suppliers, competitors, vendors, promoters and so
more that affecting on business developments. That's why should maintain the relationship with
them. Nestle company LTD is the food company that provide any kind of foods with effective
quality and customers are trusted on these products. Nestle is the biggest largest company of
foods in the UK that already build brand image in customers mind(Welford 2013).
TASK 1
1.1 Identify the purposes of different types of organisation
There are many types of organisations in which there all are purpose and rule /regulations
are different so that have to follow by all employees. Different types of organisation and their
purposes are under the below:
 Sole proprietorship: Sole proprietorship is one of the basic and normal business in which
only individual person through handle all business activities. In which only one person to
face all risk and find out the effective solution that always try to build a effective market
image and attract high number of customers in the market. This kind of business having
main purpose is provide better products and services to customers and earn high profits
from market(Craig and Campbell, 2012).
 Partnership: partnership is the another firm in which one or two persons are mutually start
a business to earn profit that divided equally with each partners. Partnership is legal form
in which have to follow rules and should make a partnership certificate to start the
business. To start the partnership firm mutually invest money and required assets these al

are liable to pay debt fund with interest. This firm having main purpose is earn high profit
and develop firm in the effective manner.
 Companies: A company is the shareholder business in which mainly include two types of
companies one is private sector and second one is public sectors company. Private sectors
company is not government company. There is no any legal rules and regulation they are
only working for earn profit not for social welfare. These are not regulated by the
government of country(Moutinho, 2011). Private sectors companies having main aims is
earn profits, maximising profits and increase market share of the company. Next one is
public sector company in which this companies are regulated by the company. These
companies are working for earn profit as well as working for social benefits.
1.2 which an organisation meets the objectives of different stakeholders
The organisation meets the different types of objectives of their stakeholders in the
company. All these are affecting companies operations, there are including stakeholders those
are under the below:
 Shareholders: Shareholders are also called the partners of the company because they have
shares of the company. Shareholders are the stakeholder of the company they have
mutually right to get all informations relating to the company. That's why all companies
are legally listed in the stock market. Nestle has main objective about shareholder,
company's provide maximum interest on shares and provide proper informations or
holding statements to them so they can easy to identify all shares of the company.
 Employees: Employees of the company play an vital role to complete all work and
activities in the effective manner and they are working for achieve objective and goals.
So company's main objectives for employees is provide healthy environment to them,
proper training and resolve their issues and problems(Halbert and Ingulli 2011).
 Customers: Company produce the products and goods for customers. Company's main
objectives towards customers is provide proper satisfaction and full fill their wants and
needs if they have any problems relating to the products so they can resolve on the time.

1.3 Explain the responsibilities of an organisation and strategies employed to meet them
There are some responsibilities of an organisation those have to full fill in the effective
manner those are under the below:
 Environmental issues: Environmental issues and problems are affecting on organisation
development process in which mainly including in customers, employees, competitors,
suppliers and so more. Company have some responsibilities regarding environment
should make a effective and healthy environment for employees and have to make better
relationship with their competitors in the market and their supplier so they can help to
promote their products and goods in the market(Commander and Svejnar, 2011).
 Ethical issues: society's having many ethical issues and norms those should not break by
the company. By the company should know about ethics and norms of the society, if they
break so society will not accept. In the other hand, company's having main responsibility
is have to focus on ethical issues and resolve them in the systematic manner.
 Consumer legislations: consumer legislations means customers related rules and
regulation like should provide healthy products and goods to them and try to full fill their
needs and wants. Company's through produce products according to trends and demand
of customers.
 Fair trade: Command's products export in other different counties so should all trade
process effective without any fraud and illegal activities. When exporting the products so
have to products packaging effective and carefully transfer one place to another.
TASK 2
2.1 Explain how economic systems attempt to allocate resources effectively
Economic system of the country is play an vital role to develop company in the effective
manner. Economic systems in mainly including some key elements those are under the below:
 Population: Population of the country affect on economic system that help to attempt to
allocate resources effectively and efficiently. Company's management system through
should identify population of the country and according to them allocate resources to

manage works and provide them goods and products according their demand.(Sena
Ferreira and et.al 2012)
 Inflation: Inflation of the country is the fluctuate on the basis purchasing power of the
customers. If they have no money to buy products from the market so inflation rate will
be reduce so that's why company's should identify and understand the future condition of
market.
 Balance of payments: Balance of payments refers to export and import of goods one
country to another country. In which having some special duties, export tax and import
tax those have to pay by the company. Balance of payments in should balance export and
import level. Because all countries wants ton export maximum products and importing
minimum in this case balance of payment help to manage import and export transactions.
 Business behaviour: Business behaviour in which including company's objectives,
investments level in the market, products, capital, power their rules and regulation all
these are help to attempt resources to the company effectively. On these basis should
produce products and goods for customers and try to utilise resources in the systematic
manner.
2.2 Assess the impact of fiscal and monetary policy on business organisations and their
activities
Business organisation and their activities on fiscal policy and Monterey policy is
impacting that should understand and analysis them effectively. All these are regulated and
control by government of the country. In which some rules and regulations those have to follow
by the all kind of company. Fiscal policy relating to the taxes and special duties in export and
import of products one country to another country that may be impacting in negative and positive
way.(Caiand Yang 2014.) Fiscal police help to control on export and import on the country or
demand. If by the government not regulate fiscal policy to control the demand so in which
countries balance of payments will be ups and down that affecting on economic growth. Next
one is monetary policy, its refries to financial positions and status of the company as well as
country. How much they are able to invest in the market and developing their company in the
effective manner. Monetary policy is regulated by the central government of country in which
including Currency and supply of money. Both these polices are impacting on organisation

activities because on the basis of fiscal police's rules and regulations have to do export and
import of products and goods one country to another country and should follow taxation systems
those are regulated by the country's government. Next one is monetary policy according to this
should invest money in the organisation developments, how much require cash in the company
to produce products and how much money invest in the market by following rules and regulation
according to the country.
2.3 Evaluate the impact of competition policy and other regulatory mechanisms on the
activities of a selected organisation
Competition Act 1998 relating to the competition in the market in which having some
legal rules and regulations those have to follow by all companies. In which set a framework for
dealing with competitors regarding products and services having some restrictions. According to
this Act should maintain the relationship with their competitors in the market and should
working according to the decided framework by the government of the country. Other regulatory
mechanisms are like competition commission, fair trading according to the law and European
commission. All these are impacting on organisation activities in which have to follow by Nestle
company. European commission is the part of European union, by this decide some rules and
take effective decision and implementation in the effective manner. By this manage and control
all day-to-day business activities and transactions in the market. All these commission are
controlled and regulated by governments of country to manage and control on companies
transactions and dealing with their competitors in the effective manner.
TASK 3
3.1 Explain how market structures determine the pricing and output decisions of businesses
Market structures help to explain various type of market. Market structures through help
to define features or characteristics of different types of market( Ishengoma and Kappel, 2011).
In the market including competitors, products, vendors, supplier, buyers and customers. All these

are important for any organisation development process. There are mainly some market
structures those are under the below:
 Perfect competition: Perfect competition is refers to all kind of small companies or firms.
In the market having competition with all firms to beat each other and build a effective
market image in the market. In which all firms are working for earn profits and attract
high number of customers towards their products and services.
 Monopoly : This type of market structure only one company produce a specific product
for customer. These kind of companies having right to any other one company copy their
products and goods the main objective is set effective market image and earn profit.
 Oligopoly: This type of market structures in having few competition firms in the market.
Only few firms or companies are producing some products so in these only having
competition to beat each other and earn high profits from the market and build a effective
brand image.
 Monopolistic competition: These kind of market structures in large number of
competitors they all are trying to beat each other but not likely to perfect competition. In
which companies are sell similar products and goods to customers but customers are easy
to differentiate with all products. In this market structure companies are easy to enter and
easy to exit in the market and according to their decision and demand.
3.2 Illustrate the way in which market forces shape organisational responses using a
range of examples
Market having many activities those are daily change according to the market condition
and situation. Market is depends upon customers purchasing power. If consumers have money to
invest in the market so country's economy will be develop. In the other hand, market force
affecting on Nestle organisation developments and according to these company will response.
Market force shape in including many elements these are under the below:
 Supply and demand: Supply and demand depends upon the customers demand and their
power to get and purchase products. Supply means offering by the company to
customers. And demand means customers how much quantity of product and goods they
needed in their life also said their desire by company. Supply and demand play and vital

role to understand customers in the systematic manner in which demand of customers
identify and according to that company will able to supply in the market(Klapper, Lewin,
and Delgado2011).
 Elasticity of demand: Elasticity of demand refers to when decrease the product price in
the market so demand of products will be increase effectively because customers at
lowest price will purchase in the high number. In this case price and demand of product
of adverse relationship between each other. Elasticity of demand depend upon customers
purchasing powers and price of products.
 Elasticity of supply: In this market force including supply of products to customers
according to them. In which when supply of products will increase so their price will be
change accordingly. Elasticity of supply depends upon customers desire according to
them company will supply products and goods in the market.
 Customers perception and actions: Customers perception regarding companies products
and goods that are affecting of customers organisation developments and production
process. customers perception means they already set their think about products and
goods of the company.
3.3 Judge how the business and cultural environments shape the behaviour of a selected
organisation
Business and cultural environment help to sharing organisation in the effective manner.
In which including many elements on these company depends and they take effective decision
regarding company all these are under the below:
 Employees skills: Employees skills and capabilities according company will allot works
so they can work effectively and efficiently. Employees skills play an vital role to
completing task and work and help t achieve goals and objectives of the company. If
employees need training to learn something so by the company conduct training program
to increase thee performance of working(.Chavis, Klapper and Love, 2011).
 Technology: Technology is day- to- day develop or update. Technology help to complete
all works in the systematic manner. At this time all customers wants something smartness
in company's services and their process of completing work.

 Business environment: Bushiness environment affecting on business developments
process in which including internal and external environment of company. That effecting
ad play an vital role in business. Internal environment include employees, products, rules,
regulations, mangers and so more. And external environment in include customers,
suppliers, shareholders, vendors, competitors and so more. All these are help to promote
products in the market and help to full fill customers needs and wants effectively and
efficiently. Other environments like political, social , cultural, legal, economical all these
are also affecting so have to understand properly and take decision.
TASK 4
4.1 Discuss the significance of international trade to UK business organisations
International trade having many significance or importance to develop a business in the
systematic manner and help to achieve decided goals and objectives. International trade in
including many legal institutions those are under the below:
 International trade: International trade refers to transfer goods, products and services
home country to foreign country under the international rules and regulation. By the
international trade increase and decrease GDP of the country.
 World trade organisation(WTO): World trade organisation relating to the international
trade of products an goods. All these activities are regulated and control by WTO. Its
inter-government organisation that manage and control activities on the world level.
 Emerging market: Emerging market refers to four developing countries those are day to
day develop their country's GDP in the effective manner. In which mainly including
India, Russia,China and Brazil(Belás, 2015).
4.2 Analyse the impact of global factors on UK business organisations
Global factors are play an important role to develop business that should analysis an d
determine after that take decision regarding any situation of the company. At the Global level
there are many factors those are following:
 Competition: In the market having competition that have to face by all kind of companies
so that's why all similar companies are producing similar products to beat each others and

build a brand image in the market. Nestle is the food company customers are easy to do
trust on their products because this company already build a market image with effective
and healthy market image and its provide good quality of products.
 Growth: Growth of the business depends upon their products production and how much
they are investing in the market to develop their business. Growth is depends on financial
status, power, supply of products and demand of products in the market.
 Trade duties and taxation: By the government decide some rules and regulations. When
company trade at the international level so have to pay decided taxes to governments and
there having some special duties those have to face by the company.
4.3 Evaluate the impact of policies of the European Union on UK business organisations.
European polices are impacting on business organisation in which including some legal
rules and regulations. European union is regulated by the government of the country. In which
including international business environment like political, social, economical, technical and
legal all these should evaluate effectively because these are impacting on business developments.
Other hand cost of capital and climate of country that will be change day to day to handle all
situation and take effective decision so there are having some rules and regulation those have to
follow by the company(Belás 2015).
CONCLUSION
Business environment help to develop businesses in the systematic manner and help to
achieve goals and objectives. Organisation environment in including internal and external
environment of business. Internal environment means employees, products/ goods, rules/
regulations, managers, management and so more. In the other hand, external environment means
customers, competitors, suppliers, vendors and promoters. All these are affection on businesses
process and their image in the market. Nestle is the food company that already set trustful image
in customers mind because that provide healthy products with effective product quality.

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