Swot Analysis of Royal Mail: Impact of Government Policies and Key Drivers on Business

This report discusses the internal and external environmental factors and key drivers that affect the functioning of Royal Mail business. It also examines and assesses the impact of government policies on the structure and operation of Royal Mail.

Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................1
MAIN BODY...................................................................................................................................1
Swot analysis...............................................................................................................................1
Impact of government policies: ..................................................................................................2
Impact of key drivers on function of business ............................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4
Online...........................................................................................................................................4

INTRODUCTION
Business environment it includes all factor of environment that affect the smooth
functioning of business. Royal Mail company offer courier and postal service that operated its
business in UK and in this report Royal Mail has been taken as a company. This report discusses
the internal and external environmental factors and key drive that effect the functioning of Royal
Mail business. At, last this report examine and assess the impact of government policies on the
structure and operation of royal mail.
MAIN BODY
Swot analysis
Swot Analysis determine the internal strength and weakness of the company and thus
helps in using available opportunity and protect the company from various threats. The Swot
analysis of Royal Mail is as follows:
Strength: It describes the Royal Mail positive attribute that differentiate it from other
competitors (Ahmadi, Dileepan and Wheatley, 2016).
Branding image: The Royal Mail company has a good brand image as it is able to manage good
customer relationship that help the company in gaining high level of satisfaction of the
customers.
Marketing strategies: The company is highly successful in its marketing strategies as it has use
various marketing tools in its market in plan in order to attract large customers.
Weakness: This explains the weak point of the Royal mail where the company needs to improve
itself.
Lack in demand forecasting: As the company is not able to forecast demand of the product it has
to maintain high level of inventory which increases the cost on the other hand many
opportunities are also missed by the company.
Research and development: Despite enough investment in research and development department
as compare to other Royal mail is not able to lead in innovation.
Opportunities: This can put the Royal mail company at advantage position .
Economy: The market in which the company operates employment level is high due to which the
employee is able to spend more and inflation rate is also low. Thus, it can be an opportunity for
the company that it can easily get credit and market its product.

Technology: Up gradation in technology can help the company in gaining more market share and
setting differentiate price strategies and increase customer satisfaction.
Threats: It includes all such factor that can be dangerous or can harm the function of company
(Miles, 2019).
Competition: The company is facing threat from increasing strength of local distributors as
competitor are paying more to local distributor.
Currency fluctuation: As the Royal mail is operating its business in different countries is facing
the problem of currency fluctuation.
Impact of government policies:
The policies, rules and regulation affect the company in many ways that are as follows:
Import and Export of company: Due to uncertain that whether the Britain will exit the
European Union or not has lead to decrease in import from china. It reduces the Royal Mail
company volume and operating margin as UK is the largest trading partner of European Union.
So, in order to cope with such situation the company has shifted itself from traditional business
to online shopping. The company is also making effort with the government to ensure continuous
movement of parcels across borders.
Company Profit margin: Due to Brexit, the companies export and import decreases as the
company business is to provide courier service and postal (Hendren and Sprung-Keyser, 2019 ).
Due to privatization, the customer are not happy as they think it will lead to increase in price
which is reduced the market share of Royal Mail. Thus, the policies of government has adversely
affected Royal Mail profit margin.
Market share: The government plans to float company within a week on the stock market thus
offering its opportunities to expand its business by making use of modern marketing technique
and by setting competitive price. Thus, it helps the company in increasing its profit and market
share.
Marketing strategies: Before the company use traditional methods to market its product but due
to digitalization the company is able to sell its product online (Gong and Sullivan, 2017). Thus,
it impacts the marketing strategies of the company and help in the growth of Royal Mail
company.

Impact of key drivers on function of business
Marketing: It includes all those activities that are undertaken by marketing department to
influence or increase the sales of the company (Karnitis, Virtmanis and Karnitis, 2019). There
are various factors that effect the marketing department such as political and legal factor, social
and technological factors. The marketer has to form its marketing strategies while felling in mind
the policies, rules and regulation of the company. By understanding the social factor marketer is
able to understand the needs of the customer and thus marketing department will offer and use
such technique that will influence the behaviour to purchase. By the swot analysis marketing
department identify the opportunity to develop its technology in order to attract customers. Thus,
all the key driver affect the function of marketing department of the Royal mail company.
Human resource management: This department help in management of people that means it
includes all function such as recruitment, training and development of employees (Sichtmann
and et.al., 2017). There are various factors that affect the functioning of human resource
management legal, economical and social factor and thus help in identifying the opportunities
and threats of the company. As per the analysis economical factor proves as an opportunity for
the company as UK has high employment rate thus enable the company for smooth and enough
delivery of parcel in the country. Social factor also affect Royal mail human resource department
it helps in management of people by identifying the culture and preference, education level of
employee. So, by considering this factor company is able to increase efficiency of employee and
hep in building brand image of the company.
CONCLUSION
From the above report it can be concluded that every organization should analysis its
internal and external factors before establishment or expansion of business. In this report Pestle
and SWOT analysis help Royal Mail company to expand its business by understanding its
strength and weakness. It also helps in protection of the company by identifying the current
threats. At last this report explain the way key drivers affect in the functioning of various
department of the company.

REFERENCES
Books and Journals
Ahmadi, M., Dileepan, P. and Wheatley, K. K., 2016. A SWOT analysis of big data. Journal of
Education for Business. 91(5). pp.289-294.
Gong, T. and Sullivan, B. N., 2017. Balancing Power of State and Market: Role of Government
Policies on Firm Innovation in China. In Academy of Management Proceedings (Vol.
2017, No. 1, p. 15384). Briarcliff Manor, NY 10510: Academy of Management.
Hendren, N. and Sprung-Keyser, B. D., 2019. A unified welfare analysis of government policies.
(No. w26144). National Bureau of Economic Research.
Karnitis, G., Virtmanis, A. and Karnitis, E., 2019. Key Drivers of Digitalization; EU Context and
Baltic Case. Baltic Journal of Modern Computing. 7(1). pp.70-85.
Miles, E. W., 2019. SWOT Analysis of Four Espoused Business School Goals. In The Purpose
of the Business School. (pp. 117-134). Palgrave Pivot, Cham.
Sichtmann, C. and et.al., 2017. Extending service brands into products versus services:
Multilevel analyses of key success drivers. European Journal of Marketing. 51(1).
pp.200-218.
Online
Williamson David. 2018. Royal Mail SWOT Analysis. [Online]. Available: Through:
<https://www.essay48.com/term-paper/13998-Royal-Mail-Swot-Analysis>.