Business and the Business Environment: Impacts of Macro Factors on JD Sports

This report discusses the impacts of macro factors on JD Sports, a sports fashion retail company in England. It covers the positive and negative impacts of political, economical, social, technological, environmental, and legal factors on the company's operations. It also includes an internal and external analysis of JD Sports, identifying its strengths, weaknesses, opportunities, and threats. Finally, the report explains how the company's strengths and weaknesses interrelate with external macro factors.

Business and business
environment

TABLE OF CONTENT
 Introduction
 Positive and negative impacts of macro environment on business operations
 internal and external analysis
 how strengths and weaknesses interrelated with external macro factors
 Conclusion
 References

INTRODUCTION
Business environment refers to internal and
external factors which influence the operations of
business for growth. It is most important element
for any company to achieve their organisation goal
effectively. For this report, the selected
organisation is JD Sports which is sports fashion
retail company in England.

POSITIVE AND NEGATIVE IMPACTS
OF MACRO ENVIRONMENT
Macro factors are elements that affects the working of
business which an organisation have no control over. These
factors are dynamic in nature and keeps on fluctuating
resulting in positive or negative impact on company.
 Political- These factors are the political situations
prevailing in country which impacts a business working.
The political environment of UK is favourable for
businesses to operate but is also dynamic in nature.

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 Economical- The factors such as inflation, interest rate, GDP, etc are the economic
factors plays a significant role in business operations.
 Social- The culture, preferences, attitudes and beliefs of people of a society have the
power to impact the operations of businesses. The people of UK are well educated
and very conscious about their health and environment.
 Technological- The changing and transforming of technologies is an important
external element affecting businesses operations. The advancement of technology is
very frequent in retail industry of UK as it is a fast pacing nation which keeps up to
date.

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 Environmental- The impact of climate change, global warming
or weather conditions are the environmental factors which
influences the working patterns of businesses. Environment of
UK is favourable for businesses to operate because of the
abundant amount of resources available.
 Legal- Legal factors like the laws, policies or regulations a
company have to follow plays an important role in the working
of business. In UK, there are various laws a company must abide
by to remain legal in the eyes of law.

INTERNAL AND EXTERNAL
ANALYSIS
Internal analysis refers to the complete investigation of a
company's internal elements like resources, workforce,
processes and assets. The internal analysis helps the
managers of JD Sports to identify scope for future growth
as well as to make effective business plan or strategies for
achievement of this growth.

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Strengths
 The biggest strength of JD Sports is it operate at large scale
which has loyal customer and supplier base.
 It has better marketing and distribution networks which
allows them to reach maximum customer as well as
increase their brand value and market share.
Weaknesses
 The biggest weakness of JD Sports is it need more fund or
investment to install new technologies for better and large
production.
 The employees of JD Sports find difficulties to work in
new line of product with current organisation culture.
Opportunities
 Many investors and political leaders of UK provides
funding to JD Sports which has great opportunities for
company to expand their business globally.
 Advance and new technologies in market provides an
opportunity to JD Sports to maintain their loyal customer
base by reducing cost of production.
Threats
 Rising price of raw materials and inputs can be a threat for
JD Sports as it decreases their profit margin.
 Intense competition in stable market of UK which allow
new companies to establish their business efficiently are
the biggest threat for JD Sports.

How strengths and weaknesses interrelated with
external macro factors
Factors Strengths Weaknesses
Political- The political leaders and government of UK provides various subsides to
companies. For JD Sports it is a strength as the top management use this
opportunity to expand their product line and business in new market
which increase their customer base.
The Bretix decision of UK government are the biggest
weakness for JD Sports as they closed down their stores in
EU which decreases the profitability of company.
Economical- There are large number of suppliers available in UK market. It is great
strength for JD Sports as the managers can acquire raw material for their
sports product at low cost which increase their profit margin.
In UK, the labour or distribution cost are slightly high
which is the biggest weakness for JD Sports as it increase
the cost of its production.
Social- The income level of people in UK are favourable as well as they like to
explore new things. For JD Sports it is a strength as company introduce
new product with high price for the customers in target market.
In UK, the customers trends are dynamic as well as they
changes their demands rapidly. For JD Sports it is a
weakness as they cannot satisfied the needs of customers
which decrease their customer base.

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Technological- The new and advance technology are in the UK market which
provides strength to JD Sports as they increase their productivity of
sports product by installing advance technology in production as well
as they promote their product on social media to attract large
customers globally.
The cost of advanced technology is high as well as it is
weakness for JD Sports as they need huge investment
to install these advance machines in their production
process.
Environmental- UK is rich in the natural resources as well as it is strength for JD
Sports because they use these natural resources as raw material in
their production process which increase their productivity.
The weather of UK are unstable which is greatest
weakness for JD Sports as it affect negatively the
sales of company is decline in winter.
Legal- The government of UK makes various laws like Equality Act 2010
for business practises. For JD Sports it is a strength as managers
provide equal rights and salary to employees so they feel motivated
and improve their quality of performance to achieve organisation
goal.
The legal formalities of business practices in UK are
rigid that is weakness for JD Sports as they have to give
penalties for late payment of taxes.

CONCLUSION
As per the above report The internal and external
elements which impacts the operations of business
whether in positive or negative way is known as
business environment. It is the sum of all factors like
employees, customers, management, administration,
government, technologies, etc.

REFERENCES
 Gogokhia, T. and Berulava, G., 2021. Business environment reforms, innovation and firm
productivity in transition economies. Eurasian Business Review. 11(2). pp.221-245.
 Halbert, T. and Ingulli, E., 2020. Law and ethics in the business environment. Cengage Learning.
 Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University Press.
 Taylor, S. and Perkins, G., 2021. Work and Employment in a Changing Business Environment. Kogan
Page Publishers.

Thank-you