Impact of COVID-19 on The Body Shop: A PEST Analysis and Skills Required for Entrepreneurs

This report discusses the impact of COVID-19 on The Body Shop through a PEST analysis, covering political, economic, social, and technological factors. It also explores the skills and traits required for entrepreneurs to succeed in the UK. Course code and college/university not mentioned.

Entrepreneurship

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
PEST analysis .............................................................................................................................1
Skills and Traits required for entrepreneurs................................................................................3
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Business environment is described as sum of all the extrinsic components of companies
that greatly influence their functioning. Macro environmental factors covers all the forces such as
social, political, cultural, customers and many more (Teece, 2018). Entrepreneurship is defined
as the development of business by an individual who takes every risk and challenges to establish
a venture. In the following report the discussion about hoe COVID-19 has influenced the macro
environmental factors of The Body Shop in UK. The respective company is a British cosmetic,
perfume and skin care company which was founded by Dame Anita Roddick in the year 1976.
The company has its headquarter in London, UK and the macro environmental factors analysis
has been done through PEST framework. Furthermore, the report also explain what skills and
traits are required by entrepreneurs to successfully launch a business in UK.
MAIN BODY
PEST analysis
This is a marketing tool which aids companies to evaluate their macro environmental
factors which could influence their working activities. This tool consist of components which
includes political, economic, social and technological factors (Dana, 2018). The following PEST
analysis has been done on the UK along with The Body Shop due to COVID-19.
Political factor: These factors of PEST analysis helps in explaining components related
to government control and policies that influence business activities. In case of UK, it is
considered as one of the most powerful nation in the world. The political environment of the
country get highly disturbed due to COVID-19 as cases were increasing which pressurised
government to take measures to protect citizens. The government implemented lock-down
restriction under which people were not allowed to move around the country unnecessary. This
also restricted companies to operate their business operations on online platform rather than
opening physical stores. This lock-down restriction impacted business functions of The Body
Shop which had to run its trading activities from various online channels. The company had to
follow all the policies and regulations executed by government in order to help it in overcoming
problems raised due to this pandemic.
Economic factor: These components of respective framework assist in describing how
financial situations of country could directly impact on long-term prospects of companies in
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market (Hrechyshkina and Samakhavets, 2019). In context of UK, due to COVID-19 the GDP
and employment rate were majorly impacted which resulted into decline in economic conditions.
In the year 2020, the GDP of the country got decline around 9.7% which was historical change
after the year 1948 and 1921 (Coronavirus: Economic impact, 2021). When the first lock-down
was executed, the GDP was almost 25% lower in April, 2020 than two months earlier in
February, 2020 (Coronavirus: Economic impact, 2021). The country also faced decline in
employment rate as many people lost their jobs or were on leave of absence. This decline in GDP
and employment rate also impacted The Body Shop activities as its employees were working
from home which resulted into less productivity.
Social factor: These elements of PEST analysis helps in determining how modifications
in behaviour of customers could influence business functioning of companies (Beynon-Davies,
2019). Due to COVID-19, people of the country were under stress as the virus was spreading
very rapidly which made them compelled to stay at their homes for a months. The preferences of
people changed as they shifted their shopping activities from traditional to online platforms.
They also become more conscious about their health and safety which restricted them to went
out in crowd even after the upliftment of lock-down. The companies also need to provide all the
necessary safety equipments to their employees when they returned from homes to offices. In
context to The Body Shop, it has to follow all the guidelines provided by government against
COVID where it has to provide PPE kits, sanitisers, gloves and masks to its employees. The
citizens of the country also have to follow social distancing protocol which made them ignoring
crowded places and shopping from physical stores of companies.
Technological factor: These components of the PEST framework assist in determining
how advancement in technologies could impact on companies. In case of UK, after the COVID-
19, the remote working and online trading activities increased which force country to update its
technological equipments. People of the country shifted their preferences towards shopping from
physical buying to online purchasing (Möller, Nenonen and Storbacka, 2020). Employees of
various companies were working from their homes which forced them to use updated
technologies so that they could work efficiently. The companies also have to increase their
online activities so that they could remain in contact with their potential customers. The Body
Shop company has also increased online activities of trading and facilitate its customers to buy
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products from its website. It also has to provide its employees working facilities from their
homes.
Skills and Traits required for entrepreneurs
Skills required for successful entrepreneur
To become an established entrepreneur it is very mandatory for a person to have some
skills which will help them in enhancing their personality and assist them in their professional
growth. Some of the skills which entrepreneurs require are explained below:
Communication
It is very essential that a person who wants to become entrepreneur must possess
effective communication skill as it will assist them in presenting their views clearly. As they are
responsible to build strong relationship with their clients, employees, investors and other people
which requires effective communication abilities(Zahra and George, 2017). This skill would
assist them in understanding opinions of others along with explaining their persuasions in front
of them. This will also help them in having one-to-one conversation with their employees where
they could explain them about organisational objectives clearly.
Time management
This is another ability which is required in the personality of an entrepreneur in order
operate business activities effectively. This skill allow a person to plan their business functions
according to their priority that helps them in making their company successful. This skill also
helps them in improving their focus and setting standards for their companies, which they make
to accomplishing business objectives and goals (Nambisan, Wright and Feldman, 2019). This
ability also assist them in prioritising their daily activities which makes easy for them to operate
business. For instance, Peter Jones always plan his schedule which facilitate him to organise
business activities effectively.
Critical Thinking
This is one of the important skill which must be possessed by an entrepreneur in order to
solve any issues and reveal opportunities for growth. This skills allow people to identify root
cause of any issues or conflicts arising in the company for which they come up with creative
solutions. This ability facilitate them to think innovate which could provide their business growth
and profitability. This skill also help them in generating new ideas for their business which could
develop more growth opportunities and bring profitability for them. For instance, J.K. Rowling is
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an author who writes novel for children in a very creative way which generate their interest in
reading.
Finance
In order to become successful entrepreneur a person must understand how to handle
financials of companies so that they can not face budget issues in future. Knowledge about how
to handle resources carefully and properly is very important so that investments could be done
effectively without any issues. This ability will allow entrepreneurs in managing their business
operations successful and efficiently (Cooper and Folta, 2017). The right financial planning
assist entrepreneurs through investing in advanced technology or marketing campaigns so that
more customer base could be developed.
Traits required for the successful entrepreneurs:
Deep Passion:
System of rules in work and passionate towards the task always work together. It takes
production ethical code to support the enterprise powerfully, and it takes affection to aware and
inspired enough to keep a good worthy value orientation. Entrepreneurs can be affectionate about
many of the things. They may be passionate about the commodities they make or services they
give (Ranville and Barros, 2021). They may be passionate about the issues they aware about
their firms figure out or about the feeling to increase the life of their consumers.
Example: Rachel Jones who is a founder of snapdragon is a very passionate entrepreneur with a
great experience of developing, creating, marketing and also inventing and taking commodities
to sell, making brands across the worldwide.
Creativity:
Firms which are thrive are often made from the best creativity of their workers. With the
assertive competence these working days, entrepreneurs are expected to come up with the actual
concepts that compare with the firms from the another one. It means thought process of a
specific concept of a business. It can also come into drama when searching a relation among two
unconnected things to figure out an issue. Inventive entrepreneurs think the opportunity that the
conventional method is not better enough.
Example: Richard Branson is a founder of virgin group who is very creative towards their work
and control more than 400 firms in a variety of fields.
Desperate towards learning:
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Nobody is knowing about all the things. A new firm does not often have faculties in all
the administrative district because of deficiency in financial support. It takes a period of time and
sources to make a team. That means a businessperson require to find out each and every thing
from accountancy to selling (Lerner,Verheul and Thurik, 2019). An entrepreneur who is anxious
to acquire fresh things will know the way to assist their new employers to solve the whole ability
suppression. And by understanding means just interpretation of essential books for the owner of
an administration, but also reading their workers, their objectives and design, and also their
issues.
Example: Peter Jones is an entrepreneur with the interest in mobiles, tv, media, leisure and many
more is the most anxious person towards learning which enable the entrepreneur to open own
and known for Dragons' Den, American inventor, Tycoon.
Motivation:
An entrepreneur does not settle down for a exhausting time of job. A business man does
not discontinue at the prototypic symbol of battle. These type of people does not grasp things off
until it’s too advanced. They take the inventiveness on their personal projects and advantage
themselves. They identify that when things get difficult, it is a questioning task that assist them
developing as a businessperson and make the firm more powerful (Cooke, 2020). Entrepreneurs
have to be own-creators to assist their enterprise criterion fast in present enterprise worldwide.
Example: J.K. Rowling is the author and an inspiration who has written all the seven series of
Harry Potter which is a very much loved series of all the people in this world.
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CONCLUSION
From the above report it has been concluded that COVID-19 has majorly impacted
various business firms which has resulted into great financial losses. From the PEST analysis it
has been evaluated that political environment faced several fluctuation due to this pandemic as
government has to implement lock-down and travelling ban in the country. This lock-down
executions severely influenced functioning of companies as their trading of products get
impacted. Economic factors states that people were furlong or lost jobs which caused decrease in
employment rate as well as GDP of the country also declined. It has also been analysed from
social and technological factors that business activities get influenced by changing preferences
along with technologies. Lastly, it could be said from above discussion that there are various
skills and traits which are required by entrepreneurs order to form a successful business
enterprise.
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REFERENCES
Books and Journals
Beynon-Davies, P., 2019. Business information systems. Red Globe Press.
Cooke, P., 2020. Dark entrepreneurship, the ‘Dark Triad’and its potential ‘Light
Triad’realization in ‘green entrepreneurship’. Urban Science, 4(4), p.45.
Cooper, A. and Folta, T., 2017. Entrepreneurship and high‐technology clusters. The Blackwell
handbook of entrepreneurship, pp.348-367.
Dana, L.P., 2018. African EntrepreneurshipChallenges and Opportunities for Doing Business.
Palgrave Macmillan.
Hrechyshkina, O. and Samakhavets, M., 2019. Foreign trade of the Republic of Belarus in the
international business environment.
Lerner, D.A., Verheul, I. and Thurik, R., 2019. Entrepreneurship and attention
deficit/hyperactivity disorder: a large-scale study involving the clinical condition of
ADHD. Small Business Economics, 53(2), pp.381-392.
Möller, K., Nenonen, S. and Storbacka, K., 2020. Networks, ecosystems, fields, market systems?
Making sense of the business environment. Industrial Marketing Management, 90,
pp.380-399.
Nambisan, S., Wright, M. and Feldman, M., 2019. The digital transformation of innovation and
entrepreneurship: Progress, challenges and key themes. Research Policy, 48(8),
p.103773.
Ranville, A. and Barros, M., 2021. Towards normative theories of social entrepreneurship. A
review of the top publications of the field. Journal of Business Ethics, pp.1-32.
Teece, D.J., 2018. Dynamic capabilities as (workable) management systems theory. Journal of
Management & Organization, 24(3), pp.359-368.
Zahra, S.A. and George, G., 2017. International entrepreneurship: The current status of the field
and future research agenda. Strategic entrepreneurship: Creating a new mindset,
pp.253-288.
[Online]
Coronavirus: Economic impact. 2021. Online Available Through:
<https://commonslibrary.parliament.uk/research-briefings/cbp-8866/>
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