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Business Environment of Woolworths

   

Added on  2020-05-16

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Running head: BUSINESS ENVIRONMENT Business EnvironmentName of the StudentName of the UniversityAuthor note

1BUSINESS ENVIRONMENT Woolworths Limited is one of the major Australian organizations wherein it hasextensive kind of retail throughout New Zealand and Australia (Woolworths.com.au, 2018). It issecond largest companies in terms of revenue in Australia after Wesfarmers and it is the secondlargest retail store in New Zealand. Furthermore, it can be seen that Woolworths is the secondlargest liquor retail store in Australia and it was ranked as the 19th largest kind of retailer in theentire world in the year 2008. Percy Christmas, Ernest Williams and Cecil Scott Waine foundedWoolworths Limited in the month of September in the year 1923. The Chief Executive Officer ofthe respective company named Woolworths is Brad Banducci. The main operations include the supermarkets that are working under the brand ofWoolworths in both New Zealand and Australia. The respective company is retailer of liquor asDan Murphy and BWS in Australia. The Woolworths Holding has also contributed towards theleisure and hospitality group along with departmental stores under name of Big W name in theentire Australia. The number of employees who are working under Woolworths is around202,000 and the operating income ad revenue generated by the company is $1.6 billion and $59billion. The detailed PESTEL analysis of Woolworths explained the external factors that affectthe retail industry and company. The PESTEL analysis includes political, economic, social,technological, environmental and legal factors. Political Factors is one such factor wherein Woolworths Company is famous name inthe entire retail industry that helps in fulfilling the requirements of the customers in the differentretail outlets. The entire political environment of the entire country is linked with the differentperformance of the organization (Calder, Malthouse & Maslowska, 2016). The different retail

2BUSINESS ENVIRONMENT organizations are affected by the political climate the entire region just like different entities ofbusiness in different other sectors. The entire political condition shapes the entire businessenvironment that will provide the organization with different growth opportunities that is suitablein nature. Furthermore, the company along with the business sector grows with the help ofpotential stability as the different investors and different traders in foreign countries in differentactivities related to business. On the other hand, the disturbance that has been done politicallydiscourages business along with investors from entering into market due to risk of return that islow in nature (Mathooko & Ogutu, 2015). Economic Factors is the second factor wherein there are different economic factors thatinclude recession and unemployment has strong effect on the performance of the companyfinancially. These different factors can affect the sales and causes financial decline in thecompany (Zhao et al., 2016). The condition of the company has diminished in nature, as therewas global financial crisis as there was a major loss in the company when the operations shutdown in The United Kingdom. The financial crisis had hit the company in an ineffective mannerand it had affected the sales of the company. However, the company had performed well in aneffective manner despite of different disruptions financially. It can be seen that the Australianretail industry has been stable and it has supported Woolworths in continuing operations ofbusiness despite the huge setback in the market of UK. Social Factors is the third factor wherein the customers are the major source of revenuein different business entities. Woolworths has recognized importance of the different customersand emphasized on notion of delight of customers. The management of Woolworths hasunderstood different changes that have been occurred in the social context (Ingenbleek,Meulenberg & Van Trijp, 2015). The location of the stores is critical in nature as customers

3BUSINESS ENVIRONMENT expect retail stores in order to provide convenience. The respective company has been able tounderstand the preferences of the customers such as removal of items of confectionary is onesuch step in this regard. The respective company has identified the shift towards healthy eatingalong with grocery items that helped them in appealing customers in an effective manner (Kotler,2015).Technological Factors is the other factor whereinthe advancement in technology willhelp in enhancing experience of shopping of customers. The entire company has integratedservice architecture that helps in supporting technology in an effectual manner. This helps inidentifying the technologies, as this becomes means of gaining stronger kind of position in themarket. Environmental Factors is the factor wherein the entire environmental factors help inreflecting usage of business that is environmental friendly in nature. Woolworths has investedresources that helped in minimizing the footprint of carbon of organization. The organization hasbeen participating in different activities related to recycling materials. The different sustainabilitypractices help in establishing image of the respective company as the responsible businesssocially (Ingenbleek, Meulenberg & Van Trijp, 2015). Legal Factors is other factor wherein the different taxation policies along withregulations of employee engagement are part of legal framework for entire retail industry.Furthermore, the requirement of licensing of foods is essential in nature and the companies needto comply with such regulations. The quality of food items is made available in stores inaccordance to regulations of country. Furthermore, opening of retail stores requires approvalfrom authority of government and it needs to follow such legal requirements.

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