Business Environment: Type of Business, Stakeholders, Organizational Structure, and Impact of Economic Environments

This study material provides an in-depth analysis of the business environment, including the type of business, stakeholders, organizational structure, and the impact of economic environments on business activities. It focuses on Sainsbury and The Royal Society for the Prevention of Cruelty to Animals (RSPCA) and explains how their organizational style helps them achieve their goals. The material also discusses the influence of political, legal, and social factors on the selected organizations and their stakeholders.

BUSINESS
ENVIRONMENT
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Table of Contents
INTRODUCTION ..........................................................................................................................4
P.1 Describe the type of business if it is a sole trader, partnership or private limited
organisation, mention the purpose and ownership of two contrasting businesses......................4
P.2 Describe the different stakeholders.......................................................................................5
M1...............................................................................................................................................6
D1................................................................................................................................................6
TASK 2............................................................................................................................................6
P3 Describe how two businesses are organised in terms of their structures and functioning
areas.............................................................................................................................................6
P.4 Explain how the style of organisation of your chosen businesses helps them to fulfil their
purposes.......................................................................................................................................7
ASSIGNMENT -2...........................................................................................................................7
TASK 3............................................................................................................................................7
P.5 Describe the influence of two contrasting economic environments on business activities
within a selected organisation.....................................................................................................7
TASK-4 ..........................................................................................................................................9
P.6 Describe how political, legal and social factors are impacting upon the business activities
of your selected organisations and their stakeholders.................................................................9
M 3 compare the challenges to your selected business activities within your selected
organisation, in two different economic environments...............................................................9
D 2 You would have evaluated how future changes in economic political, legal and social...10
CONCLUSION .............................................................................................................................11
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INTRODUCTION
Business environment includes all the internal and external factors that affect how the
company functions including employees, customers, management, and supply and demand and
business regulations. External and internal factors can influence each other and work together to
affect a business (Botha, Kourie and Snyman, 2014). There is a close and continuous interaction
between the business and its environment. This interaction helps in strengthening the business
firm. The present report is based on Sainsbury and The Royal Society for the Prevention of
Cruelty to Animals (RSPCA) which is a not for profit organization. The report will describe the
type of business, purpose and ownership of two contrasting businesses and explain how their
style of organisation helps them to fulfil their purposes. Further, it will describe how political,
legal and social factors are impacting upon the business activities of the selected organisations
and their stakeholders.
P.1 Describe the type of business if it is a sole trader, partnership or private limited organisation,
mention the purpose and ownership of two contrasting businesses
Sainsbury
Sainsbury’s Supermarkets is the UK’s longest standing major food retailing chain, having
opened its first store in 1869. The Sainsbury’s brand is built upon a heritage of providing
customers with healthy, safe, fresh and tasty food. It differentiates itself by offering a broad
range of great quality products at fair prices with particular emphasis on fresh food, a strong
ethical approach to business and continuous leadership and innovation (Boons and Lüdeke-
Freund, 2013).
Main goals and purpose
At Sainsbury’s they will deliver an ever-improving quality shopping experience for their
customers with great products at fair prices. Their aim is to exceed customer expectations for
healthy, safe, fresh and tasty food, making their lives easier everyday (Hamilton and Webster,
2015.).
Type of ownership
The type of ownership is Sainsbury’s are public limited company (plc) – has its shares bought
and sold on the stock exchange.
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The Royal Society for the Prevention of Cruelty to Animals (RSPCA)
RSPCA stands for The Royal Society for the Prevention of Cruelty to Animals. The RSPCA\’s
vision is to work for a world in which all humans respect and live in harmony with all other
members of the animal kingdom.
Main goals and purpose
The main goals for RSPCA is reducing the use and suffering of dogs in medicines testing. The
purpose is to give animals with special needs and give pets a loving care homes
(Csikszentmihalyi, and Sawyer, 2014).
Type of ownership
The type of ownership RSPCA fit into is charitable trust; this is set up to raise funds and support
other people and animals for good cause.
P.2 Describe the different stakeholders
Sainsbury
The key stakeholders for Sainsbury’s are
 Customers – they want a company to produce high quality, value for money products.
They like to see improvements that give them better value for money.
 Employees – their stake is that the company provides them with a livelihood. They seek
security of employment, promotion opportunities, and good rates of reward. They also
want to work for a company that they are proud of. Suppliers – want steady orders and prompt payment. They also want to feel valued by the
company that they supply (Carroll and Buchholtz, 2014.).
The Royal Society for the Prevention of Cruelty to Animals (RSPCA)
 Employees – the employees will need to be happy to be working on a voluntary basis and
also need to be caring for the animals that are suffering.
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 Governments – the government wants the business to be successful – it wants to see
prosperous businesses that take a full responsibility in looking after the welfare of
society.
 Local and national communities – the actions of business can have a dramatic effect on
communities. Community leaders therefore represent important interest groups.
M1
Customers influence the aims and objectives of Sainsbury because want value for money which
involves providing the highest quality products at competitive prices. The points of view of
employees is that the company provides them with a livelihood. They want security of
employments, good rates of reward and also promotional opportunities. Suppliers want to feel
valued by the company and want frequent orders with prompt payments.
D1
A business needs to take account of the interests of all its stakeholder groupings. These interests
are linked together. For example if Sainsbury decides to run the retail stores using eco-friendly
methods, this means that the cost of operation for the retail organization increases.
TASK 2
P3 Describe how two businesses are organised in terms of their structures and functioning areas
Functions of Saisbuiry are divided into four Functional Areas:
 Finance: This part of the business keeps the records of any financial activity.
 Marketing: They are responsible for identifying or anticipating customer requirements by
using market research or using the 4Ps.
 Sales: This function is responsible for customers buying what the business produces.
 Production: Responsible for who makes the products and how and when they are made.
Structure and functions of RSPCA are as follows:
 Governance: RSPCA is governed by the board of directors.
 Administration: The administration is made up of the staff that oversee all programs.
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 Programs: Through its campaigns, RSPCA raises standards of care and awareness of
issues for the animals who have no voice.
 Unique Management Areas: These may include fundraising and grant writing, volunteer
programs and public policy.
P.4 Explain how the style of organisation of your chosen businesses helps them to fulfil their
purposes
The organisational management style inter-relate with purpose within J Sainsbury, by enabling J
Sainsbury to be as successful as it possibly can and to help the supermarket meet its objectives
and ensure that it is keeping its customers happy and meeting their needs. Similarly, the
organization structure of RSPCA and strategic planning helps it to achieve their purpose and
aims. Aims of the RSPCA are to prevent cruelty to animals, promote kindness to animals and to
promote and practise the five freedoms which are: freedom from hunger and thirst, freedom from
fear and distress.
The RSPCA as a charity will, by all lawful means, prevent cruelty, promote kindness to and
alleviate the suffering of all animals. The RSPCA intends to achieve its mission by: To be active
force in achieving responsible pet ownership and responsible attitudes to animals. This is
achieved with the help of the structure of organization that comprises of Governance,
Administration, Programs and Unique Management Areas.
ASSIGNMENT -2
TASK 3
P.5 Describe the influence of two contrasting economic environments on business activities
within a selected organisation
Within my selected organisation, Sainsbury's, there are 2 important economic
environments that have an influence on business activities. Both economic environments will
have a different way on affecting Sainsbury's . The economic environments are growth and
recession.
Economic growth occurs when more goods are being produced and consumed, and incomes are
rising. A growth company tends to have very profitable reinvestment opportunities for its own
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retained earnings.
Economic growth will affect Sainsbury's as it would increase their profits due to more people
wanting more products and wanting to spend their money.
Legal-
The economy is different worldwide and fluctuates constantly, which makes this factor so
complex for large multi-nationals like Sainsbury's to tackle. To maintain maximum profitability
overall, Sainsbury's needs to raise its prices in accordance with inflation rates. If however prices
are raised higher than the rate of inflation, customers may be urged to go somewhere else or
spend less, and if the prices aren't raised high enough, they may not compensate with the rate of
inflation and decrease the products profit margin. As there are people on different budgets,
Sainsbury's tries to accommodate for everyone, which is why over recent years they have
introduced many different price-based ranges.
Social-
Social attitudes of today’s society have changed the way people live, people now are working
longer hours to sustain the financial demand that is needed in-order to keep up a higher standard
of living, “One quarter of working men and 11% of working women in the UK now work more
than 50 hours per week” . This is a social problem because it encourages people to eat ‘fast food’
type products such as pasties, sausage rolls.
Economic environment
Stability in the economy is forever changing again for good and bad and it all depends on if
we have changed are buying habits, if we spend more we will have a strong and stable economy
and
it’s the opposite for a bad and unstable economy, if people spend less and save more the
economy
will begin to full because the money is not being spent.
Recession is
when there is a decrease in growth and this can be because of two reasons, the first is that the
consumer is cutting back on the amount on which they are spending (they may be saving more
instead of spending) and this will lead to the manufactures to cut back on how much they order
from suppliers and then this will result in cut backs and this will then lead to business making
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people
redundant because they cannot afford to hire them
TASK-4
P.6 Describe how political, legal and social factors are impacting upon the business activities of
your selected organisations and their stakeholders
The consumer protection laws are of great advantage to customers as they enable fair
treatment and good value to customers.
•Competition Laws
The Office of Fair Trading monitors and ensures that all businesses are at even level with
consumers. The law protects a business from being demoted by its competitors.
For example, when Sainsbury's Ltd advertises a beverage the company is not to say, it is a waste
of money” but is allowed to say, Company reaches the top.” This legislation would limit the
market planning of the company.
Competition laws will also be an advantage to customers as they would prevent misleading
claims from businesses.
Below is a description of how a legal factor may affected.
Health and Safety Law
The law obligates Croydon Health Services NHS to ensure that employees, patients, and so forth
are to be provided a safe environment at all times.
Being in the health sector makes the law very important for the running of the organisation.
Hospitals are the centre of epidemics and diseases which makes this law very important in the
operation of the organisation. Therefore, the organisation has installed equipment that maintains
the hygiene of its hospitals.
The law also obliges the organisation to provide health and safety information and equipment to
staff and patients.
An example could be; when the organisation does advanced.
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M 3 compare the challenges to your selected business activities within your selected
organisation, in two different economic environments.
The UK economy is currently in a recession. There are a number of indicators that are
used to indicate recession. they inlcude:
 GDP
 Inflation
 Unemployment
View the interactive resource here which shows the UK economy in the last four recessions. The
interactive resource details these economic indicators:
 GDP
 Unemployment
 Inflation
 Interest rate base rate
 House prices.
D 2 You would have evaluated how future changes in economic political, legal and social
The Government may change the tax rates up or down this will be to try help boost the
economy, an example of this is VAT this means all non food and adult clothing range will need
different prices on the shelf edge labels this then means staff will then have to go change the
SEL’s ( shelf edge labels). Although this then will change the profitability and finance
department of the company as they will then need to change the profit sheets that report back to
the business.
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CONCLUSION
Company has a company cannot discriminate anyone from having a disability, different
religion or if they are pregnant and other things on this terms and when they are employed by the
company or if they are in the HR Department they are then recruiting they are also not allowed to
ask questions in these areas.
Company like to support their local community and an example Company helped out in a local
park in Bradford, by tidying it up and planting new plants to make it look more presentable and
cleaner, they also do talks in schools in local areas and give out free stock for sports days.
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REFERENCES
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Boons, F. and Lüdeke-Freund, F., 2013. Business models for sustainable innovation: state-of-
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Rothaermel, F.T., 2015. Strategic management. McGraw-Hill.
Hamilton, L. and Webster, P., 2015. The international business environment. Oxford University
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Csikszentmihalyi, M. and Sawyer, K., 2014. Shifting the focus from individual to organizational
creativity. In The Systems Model of Creativity (pp. 67-71). Springer Netherlands.
Carroll, A.B. and Buchholtz, A.K., 2014. Business and society: Ethics, sustainability, and
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