Business Environment in Marks & Spencer

Business And Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Several types of organisation and their purpose and legal structure......................................1
P2 Size and scope of different types of company.......................................................................3
TASK 2............................................................................................................................................5
P3 The relationship between different organisational functions and how they link to
organisational objectives and structure.......................................................................................5
TASK 3............................................................................................................................................6
P4: Positive and negative impact of macro environment factor on the operations of business. .6
TASK 4............................................................................................................................................8
P5: Identify internal and external analysis in order to identify internal strength and weakness.8
P6 Explain how strengths and weaknesses interrelate with external macro factors...................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Business Environment is defined as a collection of all individuals, entities and other
factors, that may or may not be under the control of the organization. These factors are affecting
performance, success & growth, profitability and even survival (Turner and Endres, 2017) .
Every type of business conduct different types of environment that can not exist in separation.
Such an environment affects business and also influenced by their activities. The purpose of the
report to the analysis environment for different types of companies and how to affect their
factors. To better understand the concept of the report selected organization, Marks & Spencer. It
is a major British multinational retail company that is dealing with high-quality clothing, food
products and home products. This company has been listed in the London stock exchange. The
report consists of different types of organisation and defines their size and scope. There are
defining interrelation between several functions in the reference of an organisation. Apart from
the report, conducting PESTLE and SWOT analysis to understand environmental effects on the
basis of internal and external basis and define interrelationship with external macro factors.
TASK 1
P1 Several types of organisation and their purpose and legal structure
An organization is defined as a social unit that is organized and managed to meet a need
or to engage with collective goals. Every business set their own management structure which is
conduct business activities and analysis the relation n between various activities and the
members. Organizations are an open system that is affected and influenced by their environment.
There are described various types of organisation such as public, private and voluntary. They
have different legal structures and purpose to conduct business activities.
Public Organization – A public organization is a government-run organization that is
fully controlled by government and paid public taxation. It takes care of various matters that
inform the public to the government like vote, protest and debate. These types of organisation
work for public and conduct activities in a legal framework. There are selected BBC (British
Broadcasting Corporation) which was founded on 18 October 1922 by John Reith. It is providing
online services through Television, Radio and online.
Legal Structure
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A legal structure of public organisation based on the legal entity where includes contract
and agreement to conduct business activities in effective manner. The public organisation has
been followed various types of legal structure like central government, state government and
local government who permit license for run business at market place. The public company
British Broadcasting is adopting the legal structure of central government to conduct business
activities effectively. The government of central provide approval to provide services to public
through television and radio (Hachicha and et.al, 2016) .
Purpose
The purpose of he BBC company to supply authentic and reliable news to public about
the world. Furthermore, it wants to get support from public regarding to their services from
different age type of people.
Private Organisation – The private sector is portion of a country's economic system
which is control by individuals and companies instead of government. Most of private
organization survive by individuals to generate profit. In the economy this segment does not rely
on money from the government and funds from charities. As a private organisation there are
taking Marks & Spencer, which is UK based company and conduct activities in retailing sector.
The company specialise into home products, food products and high quality clothing. The main
objective of private organisation to increase productivity as well as profitability.
Legal Structure
The legal structure of the private organisation categorised into sole traders, cooperatives,
partnership and private limited. Marks & Spencer is part of private organisation which is adopted
the structure of private limited. They are financing from separate form the personal finances of
their members.
Purpose
The main purpose of the Marks & Spencer to fulfil the demand of customer and satisfy
with the help of different types of products and services.
Voluntary Company – This type of organisation has been used for interchangeable with
the help of voluntary associations or action groups or agencies. It is defined as independent,
flexible, democratic, secular and non profit organization. It is mainly working for welfare of the
society. There are selected Oxfam as Voluntary organisation which is founded in 1942 by
various trusties for the purpose of work for social welfare.
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Legal Structure
Voluntary organisation follow the legal structure as unincorporated association, a trust
and guarantee based organisation. Oxfam has followed the structure as a trust which provide
basic things to live life in good manner. It can bring down the support of the poverty and
supported to poor group (Głodowska, 2017) .
Purpose
The purpose of the company to overcome people from poverty line and get good life.
They wants to help those people who can not get basic needs for survive.
P2 Size and scope of different types of company
Due to different types of organization they have different size as well as scope to conduct
business activities in effective way. On the basis of their size they can conduct business activities
and set their goals and objectives. The organization are divided into different types like public,
private and voluntary. They al have own aims as per the size and these are mainly based on the
internal and external structure. There are mentioned size and scope of various organization -
BBC
British broadcasting corporation is part of public organisation which is conducting their
business operations through different channels. It is type of media industry which is constituted
under a Royal charter and conduct its agreement with the secretary of state for digital, media,
cultural and sport. They are providing their services with the help of commercialised global
television channel. The particular providing their services through BBC studios and BBC news
group. Size and Scope – It is famous new channel in UK so size of the company is large way
and there are approx 20950 staff members working. It is providing employability to many
peoples. The company has been connected to mass media industry and it is getting that
company have about £308.6 million assets and £129.1 net income. The company
providing their services with the help of television, radio as well as online. Vision – The long term vision of the company to provide entertainment of every type of
people. To supply authentic and appropriate news to people to educate and entertain them
(Gauthier and Gilomen, 2016) . Mission – To act as public interest, providing services to all types of audiences with the
help of high quality.
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 Objectives – The main objective of the company to become largest news channel at
global level and increase their level of quality.
Marks & Spencer
It is a largest multinational retailer company of UK and headquarter of the company
situated into Westminster, London. The company specialise into food, cloth as well as home
products. The company has been listed into London Stock exchange and FTSE 100 index. It is
known as first retailer in British to make pre tax profit. There are defined about the size, scope,
mission, vision and objective of the company respectively - Size and Scope – The company has conducted their business activities on broad level and
sale out branded goods. In currently marks & Spencer operated approx 959 stores in UK
and consist of about 615 types of food products are selling out. Vision - The main vision of the marks & Spencer to long time run in retail industry and
accomplish effective sustainability. Mission – To make aspirational quality accessible to all and truly increase the property as
well as ability to extend business activities.
 Objectives – Marks & Spencer wants to generate more profit and through their products
and services provide satisfaction to people.
OXFAM
It is part of voluntary organisation which works for social needs and demands of the
people. This company mainly work for social welfare to reduce poverty line and people get basic
things to increase their living of standard. It is developing various types of plan as well as
strategy in order to remove poverty line (Um, 2017) . Size and Scope – It is biggest social fare company which is based on UK and support to
poor people. They have several federation of charitable industry and try to remove global
poverty . The scope of the company to analysis the services for reach poor people and
provide services. Vision – The vision of the company to achieve high value in the business and provide
several types of services. Mission - To reduce poverty line and increase employability to people for increase living
of standard of people.
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 Objectives – The objective of Oxfam to provide employment as well as opportunities to
people.
TASK 2
P3 The relationship between different organisational functions and how they link to
organisational objectives and structure
Organizational Functions – Due to conduct business activities in successful manner,
each business require to conduct different business functions in effective manner. To fulfil their
aims and objectives is same for whole organization. In every organization every function
connected to other functions. Marks & Spencer is one of the famous retailing company which
can conduct business activities through various organizational functions: Design and Production – There are including different types of factors in order to design
products and manufacture such as material, machinery, technology, labour and money.
Marks & Spencer apply this function due to develop their products. It design different
type of product and send into market as sample if people like it then production activity
start with the help of different types of machinery (Crane and et.al, 2019) . Finance Function – It is important function of every organisation because without it
every company can not survive properly. They are not paying tax on time. It is applied by
the Marks & Spencer to understand of statuary legislation and external stakeholders.
Finance is always essential to run for long time an manage of material, machinery, salary
of human resource. Human Resource Function – It is define as staff members of a company who will work
to achieve organisational objectives. It conduct several types of activities like
recruitment, selection, training and development. Marks & Spencer apply this function
for get knowledge of safety and welfare of employees working within it. As a result they
are designing and producing their products and arrange every financial activities, improve
sales and updating the products by research on it (Alotaibi, 2016). Sales and marketing Function – Both functions are related into direct manner because
they are producing various types of strategies to improve their sales which can impact on
their profitability. Marks & Spencer apply of this function due to increase customers and
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maintain strong relation. The strategies of ales and marketing function conduct activities
of R&D to provide authentic information and spread out of interpersonal skills.
 Research and development Function – This function is related to research department
where they are searching about the customer needs and wants. On the basis of this they
develop product to fulfil the expectation of customers. There are also mention the
innovative process regarding to different types of product & services. Marks & Spencer
always use research and development function in order to provide comfort to their
customers. As a result company increase their productivity as well as profitability in
impressive manner (Hitt and Xu, 2016) .
TASK 3
P4: Positive and negative impact of macro environment factor on the operations of business
External environment: This involves various factors which can affect a businesses.
These factors are uncontrollable which can be arises any time while running a business. So it is
very important for companies to analysis external factor and know how they can impact a
business. To know the external factor PESTLE analysis is important for organisation that defines
which factor can affect Mark and Spencer business.
PESTLE Analysis: This is framework which is used by entity to analyse and monitor the
external factors which can impacts on performance of company. The PESTLE analysis and its
positive or negative impacts of Mark and Spencer is defined as:
Political
This factor involves various element which can affect business such as tax rate, trade
policy, import and export policy, government rules and regulation etc. it can impacts on Mark
and Spencer such a if government of UK is not stable then organisation need to follow and get
permission from new government that can reduce productivity of company (Laursen and
Thorlund, 2016) ..
Advantages - Mark and Spencer can expand its business market with the help of stable
government that help to follow stable rules and regulations. Moreover, marketing manager of
organisation can perform operations effectively by applying government policy.
Disadvantages – The market share and productivity can decrease due to changes in
government and its rules and regulations.
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Economical -
It involves economical standard such as interest rate, economic cycle, foreign exchange
rate, demand and supply, inflation rate and customer needs which can affect business. The
inflation rate of UK is increasing that impacts business such as its productivity is decreasing due
to incremental in inflation rate (Schaltegger and Burritt, 2018) .
Advantages - Decrease in inflation rate can help Mark and Spencer to increase their
production and profitability. It can operate business by purchasing raw material and finished
goods at low prises. As result it can increase number of customers.
Disadvantages- Due to increase in inflation rate Mark and Spencer can not run its
business because it need to spend more money and sell their products at high prices that impacts
negatively on its business.
Social -
This factor contains different element such as changes in fashion, region, culture, attitude
and living standard of people which impacts on business. If there is changes in fashion and
lifestyle then it impacts on Mark and Spencer's business.
Advantages - Mark and Spencer can introduce new brand and fashion based products
that can influence customer in order to purchase products.
Disadvantages - Increase in competition and changes in lifestyle of people it can be
difficult for Mark and Spencer to provide satisfaction to their customers with latest trend.
Technological -
This factor involves new innovation and technology that needs to be apply by
organisation in order to introduce new products and services for influencing more customers.
Advantages - By increasing in digitalisation Mark and Spencer can offer online platform
to sale their products and services.
Disadvantages -It may be negative impact for Mark and Spencer such as time consuming
and cost effective process that can consume more time to adopt new technology (Maqueira-
Marín, Bruque-Cámara and Minguela-Rata, 2017) .
Legal -
This factor involves legislation, employment laws, consumer protection, securities,
contract and commercial laws which impacts on businesses. Such as Mark and Spencer is
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international company that deals in different types of products and services which influences
customers. It follows employment laws within industry which impacts on business.
Advantages - Mark and Spencer follows employment laws and provide safety to
customers that make feel safe their employees. As result they works more effectively in order to
increase in productivity and profitability.
Disadvantages - Due to changes in employment law organisation need to focus on these
changes that may be difficult for Mark and Spencer to spent more money for adopting new laws.
Environmental -
Those factors which can affect business environment are considered as environmental
factor. It contains climate change and pollution legislation etc. which can affect a business. Mark
and Spencer focuses on climate change and friendly environment that helps to sustain in
competitive environment (Hillary, 2017).
Advantages - Mark and Spencer sources milk from RSPCA that impacts positively and
maintain eco-friendly environment.
Disadvantages -Changes in climate can decrease Mark and Spencer's productivity and
profitability.
TASK 4
P5: Identify internal and external analysis in order to identify internal strength and weakness
SWOT Analysis – It is internal analysis which is related to micro environment and
conduct business activities of different departments to evaluate of strength, weakness as internal
and opportunity and threat as external way. It can help to easily understand internal business
situation. There are conducting SWOT analysis of Marks & Spencer -
Strength Weakness
 Offering new products with newest
industry trend.
 Strong e-commerce infrastructure.
 Maintain effectively corporate social
responsibility.
 Strong concentration on increasing
customer experience and their interest
 Lack of financial performance.
 Highly rely on UK market.
 Highly competition in same industry.
 Changes in government policy and
rules.
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towards their products.
Opportunity Threat
 Make plans to invest in other market
and increase interest of customers.
 To maintain online presence for
shopping any time.
 To reshape their clothing segment
(Rezaee, 2016).
 Stiff competition in food and clothing
sector.
 Changing lifestyle and trend of clothing
space.
 Fluctuation in currency that can be
threat for Mark and Spencer.
P6 Explain how strengths and weaknesses interrelate with external macro factors
Basis Strength Weakness
Political Marks & Spencer have major strength
of effective policies or plan of action
which can help to conduct operations
of business. It can be based on the
products which is provided by
company. They have chance to sale out
more than due to recover from political
policy.
The political activities change
eventually which is become critical
issues of UK government. It is
appropriating for business to develop
business functioning due to rise of flux
in political functioning.
Economical If company have strong economic
background so marks & Spencer are
increasing prices of their products. It
has increasing their performance in
critical time of company (Wirtz and
Daiser, 2017) .
Due to changes into currency would be
critical cause of price instability in
products of Marks & Spencer. Hence,
it has been getting that changes into
selling process influenced to outcomes
of a company and reduce profitability
of a business.
Social Due to follow current trends and
flexibility into fashion style influence
to though of every person. So Marks &
Fluxion into life style as well as in
personality of the people become cause
of rise in cost. These changes are
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Spencer makes extra effort that time
and fulfil the requirement of customers
as per trends. The social favour is
beneficial for Marks & Spencer.
implemented so get not ration as per
the expectancy.
Technological In present time every one applied
advance technology so Marks &
Spencer apply those technology which
is appropriate for their products in the
business operations for long time. It is
advantageous for company in order to
get growth due to changes in
technology and get success.
After the changes into technology, it
will create problem for company
regarding to cost. It was realised when
increase cost chances of business
growth is less and did not get good
profitability.
Legal The legal framework of the company
based on the public limited so they are
following all rules & regulations in
proper manner. As a result changes into
legal environment does not affect
strongly. Marks & Spencer with the
help of get growth on the expectation
basis at a potential level of working
(Akhter, 2017)
The legal conflicts become reason of
weakness for a Marks & Spencer. It is
directly related to brand image so
political threats are influence to their
performance.
Environment Due to changes into cultural awareness
it become cause of improve awareness
of people to deduct wastages.
Changes into environmental factors
has led to affect on the consumption of
the Marks & Spencer.
CONCLUSION
From the above discussion it is concluded that business environment in influenced by the
internal and external activities. It is total of internal and external factors that can affect to
performance and growth of a business. These factors directly affected to business activities due
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to different size, scope and purpose. They have different legal structure, vision and mission on
the basis of their size. There are different functions of a company which is interrelated to other
functions due to their merit and demerit. Every function relate to business in direct manner and
fulfil their aims and objectives. To understand the situation of company closely analysis of
PESTLE and SWOT. PESTLE analysis related to external activities and SWOT related to
internal activities and show affect that of our business.
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REFERENCES
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