(solved) Business Environment of Nestle
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Added on 2020-01-28
(solved) Business Environment of Nestle
Added on 2020-01-28
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TABLE OF CONTENTSINTRODUCTION ..........................................................................................................................3ASSIGNMENT 1 ............................................................................................................................3ASSIGNMENT 2.............................................................................................................................51.1 Purpose to different type of organization ..............................................................................51.2 Assessing the objectives of Nestle stakeholders ...................................................................61.3 Responsibilities of Nestle.....................................................................................................72.2 Assessing the impact of fiscal and monetary policy on Nestle.............................................72.3 Assessing the impact of competition policy and regulatory mechanism on Nestle..............83.1 Determining the pricing and output decisions on the basis of market structure ...................83.2 Nestle responses to the market forces ...................................................................................93.3 Discussing how cultural and business environment shapes the behavior of Nestle.............94.1 Evaluating the significance of international trade.................................................................94.2 Impact of global factor ........................................................................................................104.3 Implications of the company entering into EMU ..............................................................10CONCLUSION .............................................................................................................................10REFERENCES..............................................................................................................................122
INTRODUCTION Business environment is the combination of both internal and external factors that causesnecessary impact upon the smooth going operation of the enterprise. The given report is dividedinto two assignments. Here, the first part of the assignment will state that how economic systemattempt to allocate and make effective use of scare resources effectively. However, second partof the assignment will provide the detailed description regarding the purpose of different type ofcorporations. Furthermore, this part of the assignment will also showcase the impact that fiscaland monetary policies have on the activities of Nestle. ASSIGNMENT 1 Economic system is the organized way in which nation allocates its resources as well asapportions the products and services in the national community (Economic system, 2015). Everyeconomic system has to give answer to the three basic type of questions such as what to produce,how to product and for whom to produce etc. Nations have to obtain the answers to the givenquestions because of the scarcity of resources such as men, machine, money and material etc. Inthis regard, there are different type of economic systems identified that uses varied ways for thepurpose of allocating their scare resources in an effectual way. Command economy is the first form of economic system. Command economy is the typeof system where all the big decisions are taken by the government. Here, in this economygovernment plays the role of controller and it has the sole authority with regard to regulate thesupply and prices of the products and services which are produced in nation. Thus, in this contextit can be said that in command economy all the decisions related to the allocation of scareresources is taken by the government (Dawson, 2009). Here, in order to make the decisionrelating to what, when and how to produce government forms central planning authority whichprovides direction to it. The given economic system works upon the major aim that is to maintaingreater economic equality between its citizens. Here, prices of the products are set bygovernment in such a manner that helps in satisfying the needs and demands of all sectionpeople. However, free market economy is completely different from the command economy.Free market economy is also called as capitalist economic system wherein all the decisions withrespect to the allocation of resources are taken on the basis of market forces like demand and3
supply. In free market economy, the decision of what to produce is determined on the basis ofbasis of consumer preferences. Whereas, the decision of how to produce is taken by producer ofgoods and services. Finally, the judgment relating to for whom to produce depends upon thepurchasing power of customers (Al-Najjar, 2012). Here, in this system needs and demands of allsection of citizens such as rich, poor and medium are not given much importance. Here,producers have the major aim of carrying out necessary improvements in their sales andprofitability related condition. In this economy, demand is being considered as one of the mostinfluential factor. Thus, the economic system that gives first priority to their self interest istermed as free market economy. Mixed economy is being regarded as another type of economic system which possessfeatures of both command and free market economy. In this economic system, privateindividuals have the freedom in the use of capital, but it also allows government interference inthe economic activities with an aim to attain the social aims. The country like United Kingdompossess the given type of economic system. There are some sectors in the mixed economy wheredecision with regard to the allocation of resources is solely taken by government. It consists ofdefense, police and fire services etc (Gupta, Clements and Inchauste, 2004). However, there aresome sectors in economy such as health care where resources are allocated by the combination ofboth market and planning. Thus, it can be said that in mixed economy the decision with respectto what, how and for whom to produce is partly taken by government and partly taken on thebasis market forces such as demand and supply. On the other hand, transitional economy is the type which transformed itself fromcentrally planned economy to market economy. The given type of economy undergoes the set ofstructural changes with an intention to become the market based institution. In this system theprices for the goods and services are determined on the basis of market forces. In this regard, ithas also being assessed that restructuring, legal reforms and liberalization are being regarded asthe main element of the given economic system (Kew and Stredwick, 2005). Besides this, in this section public and private initiatives are also discussed. Public andprivate initiative is the venture which is funded and operated through the partnership of bothgovernment and private sector firm. This scheme are sometime termed as the PPP (Public privatepartnership). In this partnership, a contract is established between one private and one publicsector firm. The given partnership is also functions in accordance with the mixed economy4
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