Business Environment

This assignment explores the key issues within the sub-sector of household furnishing, analyzes them using the PESTLE model, discusses the positive and negative impact of these issues, and highlights the challenges faced in preparing the report. The business environment and its influence on industries are also discussed.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................4
TASK 1............................................................................................................................................4
P1. Two key issues that influence sub-sector of household furnishing..................................4
P2. PESTLE model by categorising two different issues.......................................................5
P3. Positive and Negative impact on two key issues..............................................................6
P4. Challenges faced while preparing this report...................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment refers to the different types of internal and external factors which
directly influence industries functions such as clients, customers, suppliers, buyers, management,
employees, demand and regulations. In present context, business environment is very necessary
term for companies in order to get idea about external factors situation of market (Hilton and
Platt, 2013). This assignment is based on Made.com, was founded in the year of 2010. It is one
of the best furniture designing and well known organisation for their experiential showrooms in
UK. Moreover, discussion will be based on key issues within the household furnishing sub sector
in the UK by following PESTLE model along with positive and negative impact.
TASK 1
P1. Two key issues that influence sub-sector of household furnishing.
Business environment means the collection of large number group of people within the
organisation, who can control different types of factors which directly influence overall functions
and operations of an organisation. Therefore, every type of business manage distinctive
environment as it can not be exist in isolation. In relation with sub-sector of household
furnishing, there are various sorts of issues which is faced by them while preparing different
types of furniture products at marketplace (Werbach and Hunter, 2012). There are 2 types of
issues which is faced by household furnishing organisations, those are mentioned in beneath:
Fluctuating customer demand: This is the main issue which is faced by different type
of organisations, because it directly influence company's growth and success at marketplace.
When cost increases then it could be difficult for an organisation to manage overall wages to its
employees as well as customers demand. This type of fluctuation makes negative image of an
organisation in front of their customers. All this is because demand within the household
furnishing industry always depends upon the consumers trends of housing, so they select what
they want. Therefore, these sorts of consumer trends have huge impact on the manufacturing
furniture industry (Ballard and et.al., 2012). According to the current scenario, consumers give
preference to small homes with less furnitures along with rented spaces with cheaper and small
furniture. This type of mind set of consumers directly influence every furniture industry so that
they can not achieve their targeted goals and objectives.
4

Increasing cost: Household manufacturing organisations are facing different types of
price hikes within the industry as well as out side the industry. When prices are high from the
manufacturing furniture organisation then it can increase overall cost of various materials and
can be develop difficult situation for them in order to make potential customers. Therefore, it is
considered as a major issue which is beneficial in both positive and negative way for furniture
manufacturing organisations. Sometimes experts within the manufacturer organisation predict
that if cost will be increased on such products like chair, table etc., so that it can break their
regular chain of customers and make competitive situation within the business environment
(Schaltegger, Lüdeke-Freund and Hansen, 2012). In order to gain competitive scenario or
overcome this type of issue from the firm manufacturers should make such strategies by which
they can achieve their targeted goals in an effective manner.
Apart from this, it can be said that if household furnishing distributors face this type of
issues which all are specified above then they are not able to gain huge success in to the
marketplace. But sometimes those issues can be beneficial in order to make better future by
applying few strategies to achieve success and growth in an effective manner. Therefore, it is
necessary for those firms who are facing such kind of situation to analyse overall needs and
wants to customers at marketplace and make various strategies accordingly.
P2. PESTLE model by categorising two different issues.
PESTLE analysis refers to the overall concept of marketing principles which is generally
used as a important tools and techniques by companies in order to track entire situation of
marketing as firms are operating their overall business functions and operations in order to
promote and launch various goods and services to give better satisfaction to customers at
marketplace. Whereas, P stand for political, E for economics, S for social, T for technological, L
for legal and E stands for environmental (Berg and Kilambi, Siebel Systems, 2014). With the
help of this model house hold furnishing firms can easily make certain ideas and plan in order to
gain huge benefits and success for betterment of future. This model is going to be described
below:
Political factor: These factors mainly determines a particular extent in which
government factors can be influence overall economy as well as different business industries.
According to this government bodies can impose a new duty or tax which bring few changes into
5

the overall structure of an organisation. In relation with Household furnishing sub sectors they
are needed to follow all these sorts of tax policies to stay for long period of time.
Economical factor: This factor is based on economy performance which directly impact
on a organisation and long term effects (Bharadwaj and et. al., 2013). For example if Made.com
will increase the price as per the inflation rate of any economy, it would be influence overall
services of this organisation.
Social factor: It always identifies about different types of cultural trends, population
analysis, demographics and so on. For example: buying trends for western countries such as US
wherein, high demand during the holiday season.
Technological factor: It shows the innovation in technologies which directly influence
business industries market favourably as well as unfavourably.
Legal factor: These are those factors which have appropriate combination from internal
and external sides. For this, there are certain law in country which is followed by specific
organisation to maintain their policies.
Environmental factor: These sorts of factors mainly influence surrounding environment
within the companies. Farming, tourism, agriculture are the example of this factor.
Apart from this, from the above issues this can be said that, issue of increasing cost one
of the major problem comes under the economical factors by which household furnishing
organisations can measure overall activities of people at marketplace (Prins and Cybercrime,
2011). By having this evaluation they can make effective cost accordingly. Another issue,
Fluctuating customer demand is based on technological factor, in present scenario there are
different type of distributor who are dealing with household furnishing items, so that firm is
required to understand preference of customers so that they can apply innovative technologies on
their furniture by which they can achieved desired goals through satisfying consumers needs.
P3. Positive and Negative impact on two key issues.
Positive Impact: In order to face different issues within the marketplace, household
firms are required to make unique and innovative strategies by which they can make them
attractive in front of their customers. Increasing cost could be the benefit for Made.com as they
provide better quality of furniture products so that they have a chance to increase cost in order to
gain competitive advantages in a perfect way. For example: if an organisation providing better
furniture quality with effective cost then it will influence large number of people in an effective
6

manner. Along with this, it will also increase the value of product and reach at higher level
within the marketplace. Thus, it will make positive impact in front of their competitors and make
them effective.
Negative Impact: At current scenario there are different types of government rules and
regulations for all the manufacturer organisations, if they do not follow different policies and
regulations given by government then they can get loss and not able to meet their targeted goals
and objectives in a perfect way (Wheelen and et. al., 2017). Due to the high inflation firms are
not able to give appropriate wages to its employees and also not able to manage their works and
operation in a proper way. Therefore, it directly influence people demand and their behaviour in
a negative way. On the basis of fluctuating customer demand issues companies can get huge loss
due to the developing economy. According to the current period of time most of the people refers
to the small rooms and apartments in which there is no requirement of huge furniture so that it
reduces the value of household furnitures, so this type of negative impact influence others
effectively.
Therefore, this can be said that positive impact and negative impact both have different
values and plays various roles in to the household furnishing organisations.
P4. Challenges faced while preparing this report.
Within the competitive scenario there are different types of industries which are
managing different types of operations by using various strategies and operations in an effective
manner. According to me while making this report I faced few challenges in order to achieve
organisational goals towards household furnishing firms, so now it can be said that such type of
firms are required to have different types of furniture qualities with effective designs which
directly influence people in a positive way (Janita and Miranda, 2013). On the other side, I
observed that there are two types of issues which is mainly faced by household furnishing such
as Increasing cost and Fluctuating customer demand by facing these sorts of problems I have
concluded that if furniture distributor firm would follow PESTLE analysis properly then they can
apply different types of innovative thoughts in order to overcome these factors. By reducing
these sorts of issues from the company they can achieve their organisational goals in an effective
manner. Apart from this when I prepared this file I also observed so many other things like
positive and negative impact of those issues within the business firms. But I think if firm will
follow different types of rules and regulations, which is given by government, so that they can
7

make them attractive and able to give better facilities to its people so that they can achieve
predetermined goals in a perfect way. Along with this, I can say that there is a huge impact on
business as above specified issues affects business condition in both negative or positive way.
The other important thing is that I have learned the main reason of doing PESTLE analysis is to
make business effective and attractive to achieve targeted goals in an appropriate manner. As I
learned so many things while making this assignment so I have a chance or opportunities for
future that I can make better project with the help of following various forms of business
environment (Vitale, 2011). Furthermore, I can prepare myself for making better research in
future in order to get huge knowledge about overall internal and external factors within the
business environment. Now finally I can say that, yes I faced few challenges while making this
assignment but on the basis of this I have learned so many things and take huge experience and
knowledge about business environment so that I can achieve my predetermined goals with the
help of various forms in entire business.
8

CONCLUSION
From the above representative assignment it has been concluded that, business
environment is the sum total of internal and external factors which is mainly affects functions
and operations of entire business in an effective manner. There are different types of issues
which is faced by furnishing household firms while making their products. In order to reduce
these sorts of problems there are different types of ways by which firms can achieve their goals
in a perfect way. Herein, by using PESTLE analysis they can gathered huge information about
marketing situation in order to make their every activity better. Therefore, it is necessary for firm
to opt all things which is related with entire market situations.
9

REFERENCES
Books and Journals
Hilton, R. W. and Platt, D. E. 2013. Managerial accounting: creating value in a dynamic
business environment. McGraw-Hill Education.
Bharadwaj, A. and et. al., 2013. Digital business strategy: toward a next generation of insights.
Berg, E. and Kilambi, K., Siebel Systems Inc, 2014. Method and apparatus to facilitate
development of a customer-specific business process model. U.S. Patent 8,639,542.
Schaltegger, S., Lüdeke-Freund, F. and Hansen, E. G. 2012. Business cases for sustainability: the
role of business model innovation for corporate sustainability. International Journal of
Innovation and Sustainable Development. 6(2). Pp,95-119.
Ballard, C. and et.al., 2012. Dimensional Modeling: In a Business Intelligence Environment.
IBM Redbooks.
Werbach, K. and Hunter, D. 2012. For the win: How game thinking can revolutionize your
business. Wharton Digital Press.
Vitale, R. P. 2011. Business to business marketing. Pearson Education India.
Janita, M. S. and Miranda, F.J. 2013. The antecedents of client loyalty in business-to-business
(B2B) electronic marketplaces. Industrial Marketing Management. 42(5). Pp,814-823.
Wheelen, T. L. and et. al., 2017. Strategic management and business policy. pearson.
Prins, J. R. and Cybercrime, B. U. 2011. Diginotar certificate authority breach’operation black
tulip’. Fox-IT, November.
10