Business Environment and Strategic Management

Running head: BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT
Business Environment and Strategic Management
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1BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT
Executive Summary
The retail industry of the United Kingdom can be considered dynamic. Sainsbury’s, who have
been established back in 1860, find themselves in a stable position till date which was backed by
their consistent performance. The company expressed interest in merging with Asda, their long
term rivals whose parent company is Walmart. Both the companies showed leeway on the
proposal which has led to a huge amount of speculation in the market. It has been opined by the
highest regulatory bodies in the territory as unfavourable and that it will lead to deterioration of
end user experience. Sainsbury’s lost its share value and there are subject to much more
devastating consequences. The aim of the paper is to enlarge and elaborate on the case scenario,
its implication, the possible rationale and the effects that the event could have on the
stakeholders. Finally recommendations have been provided regarding how the companies can
mitigate the issue that could possibly exist if the event becomes a reality.

2BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT
Table of Contents
Introduction......................................................................................................................................4
Case overview..................................................................................................................................4
Findings and Analysis......................................................................................................................5
Implications.................................................................................................................................5
Reasons behind opting for the merger.........................................................................................6
Intense competition..................................................................................................................6
New market opportunity..........................................................................................................7
The Stakeholders.........................................................................................................................8
The employees.........................................................................................................................8
The customers..........................................................................................................................8
Shareholder..............................................................................................................................9
Supply Chain Relations.........................................................................................................10
The external environment..............................................................................................................10
Porter’s five forces model..........................................................................................................10
SWOT analysis..........................................................................................................................11
The ethical issue............................................................................................................................12
The current scenario..................................................................................................................13
Conclusion and recommendations.................................................................................................13
REFERENCES..............................................................................................................................16

3BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT