Evidence from Vietnam

The provided content appears to be a collection of various academic and online resources related to business, economics, and management. The sources include journal articles, books, and online references that discuss topics such as market structures, monopolistic competition, fiscal policy, monetary regimes, international trade, and the effects of distance on global business. One specific article, 'Emerging markets to be market oriented? Evidence from Vietnam' (Journal of Business Research), examines whether emerging markets should adopt a market-oriented approach. The content also includes online references that define stakeholders and monopolistic competition, as well as resources on policy-making in the European Union.

BUSINESS ENVIROMENT

Table of Contents
INTRODUCTION................................................................................................................................3
LO1.......................................................................................................................................................3
1.1....................................................................................................................................................3
2.1 ...................................................................................................................................................4
1.3 ...................................................................................................................................................5
LO2 ......................................................................................................................................................6
2.1....................................................................................................................................................6
2.2....................................................................................................................................................6
2.3 ...................................................................................................................................................7
LO3.......................................................................................................................................................7
3.1....................................................................................................................................................7
3.2 ...................................................................................................................................................8
3.3 ...................................................................................................................................................9
LO4.......................................................................................................................................................9
4.1 ...................................................................................................................................................9
4.2 .................................................................................................................................................10
4.3..................................................................................................................................................10
CONCLUSION...................................................................................................................................11
REFERENCES...................................................................................................................................12

Illustration Index
Illustration 1: Stakeholders...................................................................................................................5
Illustration 2: Market Structure............................................................................................................9

INTRODUCTION
The projects highlights on the business environment of Asda. Asda is the subsidy company
and operate in the retail business in UK. The company provides customers with low priced
products. Environmental affect on the business of Asda is discussed in the report. International trade
practices helps the company to import and export products and services in global market. Fiscal and
monetary policy have been studied in the research to identify their impact in the business of Asda
(Teece, 2012). Vision, Mission, goals and objectives are highlighted to show the strategies of Asda
regarding the conduct of its business operations in UK.
LO1
1.1
Tesco is the leading retailer of UK. It provides food, non food, mobile and various other
services to the citizens of UK. Vision- The vision statement states that Tesco wants to serve for maximum customer
satisfaction and value services to its customers. Mission- The Company wants to expand business through innovations and technology and
by inspiring its employees to work for excellence (Evangelista and Thuy, 2013). Goals- Tesco's goal is to understand the needs of customers and to act responsibly in
providing those values to the customers. Objectives- The core objective of Tesco is to serve its customer on day to day basis and to
lead the UK market in customer share.
 Legal structure- Tesco is a private owned company (Patron and Smith, 2013).
Asda is the second famous retail organization of UK. It is the owned subsidy of Walmart
since 1999. Vision- Asda's vision is to become UK's best value retailer. Company strikes to work for
excellence towards its services provided to the customers Mission- ASDA wants to become Britain's best-value retailer by exceeding customer
satisfaction and generating maximum customer traffic (Herz and Hohberger, 2013). Goals- ASDA's goal is to produce goods and services which are more affordable for its
customers. Objectives- ASDA respects each customer needs and requirements to strive for excellence
while generating services to the customers.
 Legal structure- ASDA is a private owned company of Walmart (Bruckner and et.al., 2012).

2.1
Stakeholders of ASDA are divided into internal and external stakeholders. Internal consists
of owners and employees whereas external consists of customers and suppliers.
Source: (Boundless, 2015)
Internal Stakeholders- Owners- Owners have the highest power in the decision making of ASDA. They formulate
strategies and policies that help to increase the profitability and generate market share of the
company (Becker, Chen and Greenberg, 2013). They have the sole power for any product
and service development being introduced to the company.
 Employees- They have less dominance in the decision making, but indirectly affect the
decision of the company. Employees are responsible to perform the task and to achieve the
goals and objectives of ASDA. Employee participation is important as it generate the
profitability for the company.
External Stakeholders- Customers- They are the most important stakeholder of the company. Customers directly
affect the company as their preference and choice lets ASDA to decide about new strategies
and product development (Krautheim, 2012). Customer satisfaction is the ultimate target
that ASDA has to fulfil.
 Suppliers- They are important as the products quality is generated through the supplies they
produce to ASDA. They have low dominant power over the decision making of company.
But are given importance as they provide value to the goods and services. It is Asda’s duty
to regularly pay for the advances and dues of suppliers to maintain cordial relationship with
Illustration 1: Stakeholders

them.
Stakeholders play a very crucial role in achievement of goal and objectives of the company.
They are- Owners- To Generate strategies formulate decision; regulate the management of the
company (Kanemoto and et.al., 2014). Employees- Their objective is to work as per their designation and to earn salary and
incentives. Suppliers- Their involvement is to generate cordial relation and to get payment for their
supplies
 Customers- They are the reliable source of income for the company (Wodak and Boukala,
2015). Their objective is to use the value and devices of the company and to pay for the
same.
1.3
ASDA responsibility is described below- Responsibility towards Stakeholders – To provide them with satisfaction towards their
services. To generate mutual cooperation with them. Stakeholders are the regulators of the
companies goals and objectives (Gutiérrez and et.al., 2013). They help to achieve the
financial requirement of ASDA. Legal Responsibility- To abide by the various laws and regulation formulated by the
company. ASDA makes sure to follow all the rules that are mandated by the government of
UK.
 Socio-environmental Responsibility- To develop the society and meeting the future
development through sustainability ASDA promotes the use of renewable energy to mange
energy for the future generation. Management Responsibilities- It is the responsibility of ASDA's management to define both
short and long term objectives along with this it is duty of the top level management to do
strategic planning of the organisation (Stern, 2015). Moreover, allocation of roles and
responsibility for the employees are to be addressed at their end. Business ethics- To follow the business ethics ASDA has decided to lower the emission of
carbon by the company. It is ASDA's policies to use eco-friendly measures to help reduce
the harmful impact on the environment.
 Public Relations- Asda is responsible to maintain its public image in the eyes of customers.
It is important as public image helps to generate sales (Crafts, 2012). A good PR helps
customers to ascertain about various types of goods and services produced by the company.

LO2
2.1
An economic system is a system of production and exchange of goods and services which
help in allocation of resources in the economy. There are four types of economic systems- Capitalist- In this economy production and allocation of resource id dominated by private
ownership. Mixed economy- In this system there is a combination of public and private ownership in the
economy (Fernando, 2011). Socialism- It is a command economic system where government regulates the economic
factors.
Traditional Economy- In this economy the production and allocation is controlled by beliefs and
traditional thoughts.
UK being a mixed economy the major part is controlled by private owners and less
controlled is transferred to the public body. The governments intervention is limited to framing
policies rules and regulations in economy. The producers and manufacturers have to abide by these
rules and regulations and have to follow them strictly. In case of violation government has sole
authority to fine charges on the companies. Various factors and trend running in economy effect the
allocation of resources (Shaikh, 2010). Lifestyle, demographics, psychological, market trends
directly affects the choice of resources and production as well.
Whereas in UK a command economy is a socialist economy government is only responsible
for decision making regarding the allocation and productions. Generation of goods and services
depends upon various government authorities and autonomous bodies. What, how and where to
produce is facilitated by the government itself.
2.2
Fiscal and monetary policies impact directly affects the business and profitability of Asda.
Fiscal policies impact the spending and purchasing power of the company. For example-
 Taxation- High tax rates affects the profit generation capacity of the company. Asda would
have to increase the price of its good in order to save taxes. This impacts on the price rate of
the economy and generate inflation. Monetary Policy are regulated by the central bank of UK who has the sole authority of
regulating money in the country (Morrison, 2011). Interest Rates- High interest rates regulated by the central bank of UK creates fluctuations in
spending capability of Asda. If the central increases the rate of interest in the country, the
company will have to raise fund through overseas or public borrowing. This will increase
the cost of products and will thus make the goods and services costly.

 Exchange Rates- It is duty of the central bank to predict the exchange rate of currency to the
company. This is helpful on buying and selling of goods through international currency. It is
helpful for the overseas business of the company .
 Quantitative Easing- It is a type of monetary policy regulated by the government to
stimulate the economy when monetary policy becomes ineffective in the country. The
government buys short term bonds to ease the companies and manufacturers in case of any
backlogging in the economy (Cavusgil and et.al., 2014). It generates funds for the company
in case of any economic emergency.
2.3
Analysis of the competition in UK helps to understand and regulate fair competition in the
market. These policies help the market to work better. The competition act of 1998 was formulated
by the UK government to regulate the competition between companies in the economy. The
competition act and policies impact Asda’s by the following ways-
 The act encourages innovation in technology by providing a wide range of choices for Asda.
The company facilitates use of honest technological skills and abides by the act’s policies to
operate fair competition in technological arena.
 Competition act helps Asda to contribute to various national competition among various
companies existing in the economy of UK (Beynon-Davies, 2013). This contribution reflects
an competitive advantage to Asda by reducing the harsh strategies formulated by the
contenders of Asda.
 The act facilitates consumer to buy goods and services that have honest pricing attached to
them. As per the competition act the companies have to opt for honest pricing strategies to
control price rate in the economy.
 The act emphasise on providing honest advertising and marketing about the product. This
controls the companies any inappropriate advertising policy that may misguide the
consumers (Hansen, 2013).
The competition commission foresees competition prevailing in the market. It keeps a check
on Asda’s competitive strategies to control any negative impact of strategies on the consumers.
LO3
3.1
Market structure is a market here firms produce and sells their goods to the consumers.
There are four types of market structure. They are-

Source: (Economics online, 2015) Monopolistic competition- In this type of market each product is different from one another.
More than one producer sells its goods and services in the economy. In monopolistic
competition price and output are decided by the producer (Frenkel and Johnson, 2013). As
there is no substitute to the product the producer has dominance over the output and pricing
policies. Oligopoly Competition- In this market there are very few producers. The producers have the
control over the market factors of the economy. Thus a small number of firms and producer
have the decision making power to generate output and price of the goods and services
produced by the company. Monopoly Competition- Monopoly market consists of only one single producer who
produces and regulates the output of production in the economy. The economy of scale
generates pricing policies that attract large number of buyers (Winham, 2014). To survive in
the market the producers tries to lower its product pricing to raise the output of the products.
 Perfect Competition- UK has a perfect competitive market. This market structure in a
perfect competition has no barriers on the entry and exists of producers. More than one
producer can produce goods and services in the economy. Unlimited number of producers
produces goods and services thus output and price of various products are differentiated
from each other.
3.2
Market forces are responsible to change the business strategies of Tesco. These strategies of
demand, supply, etc. are responsible for shaping the business activities of Asda. Demand- This market force directly affects the price policies of Tesco. For example if the
Illustration 2: Market Structure

demand of the product rises in the market. There are various factors to these like
competition, brand, choice and preference of customers. The company may decide to
increase the price of the products (Yarbrough and Yarbrough, 2014). This way Asda can
increase its profitability thorough high sale of products and services. Supply- Asda as a retailer faces low sale in terms of new products and services as customers
prefer to stick to the old ones. To increase sale of goods and products Asda's management
may decide to reduce the cost thus can decline the price of its goods and products. Low
pricing policy will attract customers. Company can make for revenue through low price
policy.
 Customer Perception- To generate goods and services as per customers perception Asda
have to spend more ion research (Wallace, Pollack and Young, 2015). The research will the
management to ascertain about various lifestyle and fashion trends that directly affects the
perception of customers. They get selective due to the reflection of these factors prevailing
in UK.
To regulate these market forces Asda has to constantly develop new policies that can handle
the market force.
3.3
Cultural environment is responsible for the production of goods and services by Asda.
Various dimensions of cultural environment affect Asda in the following way-
Economic situation- The economic factors like costs, interest rates, exchange rates, etc. affects the
Products cost of Asda. Asda’s pricing strategy are generated by assessing these economic factors. A
shift in economic factors raises or lowers the pricing of companies. Cultural diversity – UK is a culturally diversified country. The consumers want and get
attracted to the products that are traditionally reflecting the cultural diversity of the country
(Evangelista and Thuy, 2013). Asda makes sure to provide wide range of product that
originate with the culture of UK Life styles – Trending patterns of lifestyle in various classes of UK also complies with the
business cycle of the company. The strategic policies of Asda are decided by researching on
the trends in lifestyle of the citizens of UK.
 Behaviour –Consumers quickly change their taste and preferences according to the fashion
trends prevailing in the country (Crafts, 2012). The change in behaviour, taste and
preferences of the consumers in UK gives choices to Asda in deciding but the product range
available for sale in the store of the company.

LO4
4.1
International trade is referred to the exchange of goods and services between countries. In
this trend the global economic factors affect the prices, demand and supply factors of the products. Comparative advantages- International provides both the host country and the home country
chances to increase capital and investment in the company. Asda has facilitated from the
international trade operations as a lot of return on investment has been generated from the
foreign trade (Krautheim, 2012). Balance of trade and payment- Trade and balance of payment is regularised by the current
account deficit in UK. To successfully operate in the global market Asda has to keep a check on
the value of goods and services imported and exported from UK. Economic growth – International business by the multinational enterprises i.e. Asda has
generated various income sources for UK. The capital generation from the investment in host
countries raises and builds economic growth of UK. A good economic growth figures raises the
goodwill of the country in global market (Teece, 2012).
 Competitiveness- International business lowers the risk of competition in the global market. As
the set up of multinational enterprise is and expensive process, many companies and brands are
dis-interested in the process. Thus the competition for Asda reduces in the global territories.
4.2
Global Factors of various countries that are trading with Asda affect the business cycle of
the company. They are as followed- Political Factors- The political policies formulated by the existing government of UK impacts
the business strategies and policies of the business organisation in UK. Employment laws,
Trade control, tax policies affect the pricing policies of Asda. Economic- The factors of demand and supply, taxation, inflation that persists in the economy of
UK affect the output and the sales of company (Krautheim, 2012). The capacity of Asda to
produce business depends on the economic factors prevailing in the economy of UK. Social- Taste, Preference, lifestyle and fashion trends are responsible in the product strategy of
Asda. The company decides to sell a product any after reviewing the trends and factors that
facilitates consumer choices living in UK. Technological- The technological development available in UK provides Asda to bring
innovation in the products of the company (Cavusgil and et.al., 2014). UK government
provides various technological help to the companies and promotes the business to raise their IT
capacities.
 Legal- Acts and policies have been formulated by the government to increase fair trade
practices in the country. The UK government keeps a close eye on business to guide them to not

deflect them from their corporate responsibilities. These acts and regulations are compulsory to
be abided by Asda.
4.3
Different factors of economy, socio-cultural, European union, rules and regulate impact the
objective and strategies of Asda. They are discussed as under- Laws of the European Union- The European Union regulates the political and economical
factors prevailing in the group, which is a union of 28 member states. The union articulates
about the regulation of economic, social and political policies (Hansen, 2013). Asda has to
abide by these policies regulated by the union. Rules and Regulations- Policies are formulated by the government that helps Asda to conduct
its business activity in international market. Rules and regulation made by the UK government
helps. Business Policies- Asda formulates strategies for its operations and productions. The strategy,
policies, vision and mission of the company helps the retailer to operate and achieve its
objective. Business policies help in effective management of goal. Labour Policies- Wage policies formulated for the labourers working in Asda protect their
rights., The labour union is formed to issue the rights and policies formed to safeguard the
interest of labours (Wallace, Pollack and Young, 2015).
 Social- Economic Policies- Social responsibility of Asda is to maintain carbon emission and to
propagates sustainability. The company has to flow factors of economy to generate best business
activities. Various acts and commission in the country helps to keep a check on the business
activities performed by Asda.
It is important to evaluate the impact of these factors to generate more profitability for Asda.
CONCLUSION
From the research it can be concluded that external environmental factors like political, social,
legal influence the price and output of Asda. Factors of lifestyle, taste and preferences reflect the trend
prevailing in UK. The market structure in UK helps Asda to formulate strategies which are controlled by
the market forces in UK. Asda abides by the competition act and policies formulated by UK government
to create fair competition in the country. Impact of fiscal and monetary policy are directly affecting the
business operation of Asda. These factors combine to create a business environment which lets the
company to produce goods and services and to provide it to the customers of Asda.

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