New Structure of Online Business

This paper aims to understand the structure of planning a new start-up of online business. It analyzes the PESTLE factors, strength and weakness of legal framework, funding techniques, sectors of operation, and more.

Running head: NEW STRUCTURE OF ONLINE BUSINESS
New Structure of Online Business
Student’s STU Number:
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Author Note:

1NEW STRUCTURE OF ONLINE BUSINESS
EXECUTIVE SUMMARY
The main aim of this paper is to understand the structure of planning a new start-up of online
business. In this connection, the report tends to analyse the PESTLE factors that affect the
online industry of an existing company known as eBay. Further, the report relates those
factors in understanding the impact of the same in the new online business firm. Moreover,
the report analyses the strength and weakness of the legal framework that would create an
effect on the new company. Furthermore, the report examines the funding techniques that
would help in the financing of the business. Later the study identifies the sectors that the
business would operate in, to gain the desired revenue and profit. The study then examines
the value of those sectors to the economy of the UK and then the importance of the HR and
the policies the HR needs to follow in the execution of the business. Lastly, the report ends
with providing a personal reflection about the understanding of the report in the appendices
part.

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Table of Contents
Introduction................................................................................................................................3
Question 1..................................................................................................................................3
PESTLE Analysis...................................................................................................................3
Question 2..................................................................................................................................6
Strength and Weakness of the legal frameworks...................................................................6
Funding for the business........................................................................................................8
Question 3................................................................................................................................10
Sectors of Operating the business........................................................................................10
Value of the sectors to the economy of the United Kingdom..............................................13
HR Policies...........................................................................................................................14
Appendices...............................................................................................................................16
References................................................................................................................................17

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Introduction
As opined by Heifetz and Linsky (2017), structuring is a new online business has to
go through a lot of plans and procedures before the establishment of the same. In this
connection, the particular report in order to investigate the pros and cons of the same
undermines the macro environmental factors that would influence the growth of the new
structure of online business. The report critically highlights the major strength and weakness
that would come along in the future of the business and how the same can be turned to an
opportunity. The report hereafter sets an idea for the entrepreneur on the several ways that
can help in the funding of the business.
Question 1
PESTLE Analysis
As implied by Gaspar et al. (2018), PESTEL analysis is a strategic business tool that
helps in determining the external environmental factors that impact the plans and processes of
a business. In this connection, the study of PESTLE done based on eBay is examined below.
Political
 The increase in the trade protection system.
 The threat of invasion of the military.
 Intellectual protection of property.
 The mandatory and strict benefits to the employee.
 The requirement of labelling the products primarily in the retail sector.
 The strictness in the anti-trust laws and policies.
 Regulation of trades and tariffs in the service sector.
Economic

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 The different types of financial system and orders in the country where the business
entity is operating its online processes.
 The rate of inflation.
 The rate of interests.
 The education level and standard in the economy.
 The effectiveness and efficiency of the financial market condition.
 The quality of the infrastructure in the retail and another business sector.
Social
 The demographics of the country.
 The level of skill and talent of the population that determines the employment
procedure for the concerned company.
 The level of education standard of the individuals in the eBay industry itself.
 The cultural conventions of society.
 The attitude approach of the customers.
 The interest in the leisure activities of the customers.
 The structure of the class, power and hierarchy of the society.
Technological
 The frequent change in the development and advancement of technologies.
 The impact of technology in the offering of products and services.
 The diffusion rate in technological innovations.
 The influence in the value chain management in the sector of providing service.
 The influence of cost structure especially in the service sector of a business entity.

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Environmental
 The seasonal climatic changes.
 The unpredictable changes in the weather condition.
 The laws and orders regulation the conditions of the environment.
 The necessity of recycling products.
 The need for waste management.
 The attitude approach of eBay towards the eco-friendly products and environment.
 The behaviour of the business towards the support of sustainable renewable energy.
 The strict laws and orders to environmental protection and sustainability.
Legal
 The patents, copyrights and laws related to the intellectual property concerning eBay.
 The laws to eliminate discrimination.
 The laws and norms of employee recruitment.
 The protection and confidentiality of the customer’s data.
 The protection of e-commerce.
 The laws and regulations towards the health and safety of society.
Based on the above examination of the PESTEL analysis of eBay online company, the
crucial factors that may impact the business plan of the new structure entrepreneurship are
mainly determined to be the intervention of the government in the retail sector (Rule 2016).
This is because the business needs to be set up according to the legal considerations of the
government or the company gets a risk to be terminated. Secondly, the interest and the
attitude of the society the business is to target would influence the success of the business.
This is because the company to gain revenue and earn profit needs to have a strong customer
base whom they are to target to offer their served products and services. The improper base

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of customers will lead to failure of the business and result in a loss as well. The third key
factor that was examined is the liability of the company towards the safety of the
environment. The new business entity is accountable to sustain the ecological factors of the
environment by encouraging the production of eco-friendly products and usage of raw
materials to produce the final product that would eliminate the release of harmful gases that
destroys the natural environment. The next massive factor that may impact the success of the
newly structured business is the framework adhering the patent rights, and labelling needs to
the products generated by the company. The company has to potentially provide every
information related to the products they are offering to avoid the risk of fraudulence to the
customers. The other main factor that was examined to impact the new organisation is the
laws and orders towards the health and safety of society. The new business entity should be
set up with the viewpoint to sustain the health and safety of the entire organisation as well as
the community as a whole. The firm is accountable to provide its employees with a safe
working environment as well as ensure the elimination of harmful preservatives and raw
materials to produce the final product that may cause harm to the health of the traditional
society. Last but not the least keeping the data and information of customers confidential is
the responsibility of the firm since online business entities have a huge amount of customer
data stored within their business transactions. Lack in the same may disrupt the brand and
customer loyalty of the company in the long run and therefore may impact the success rate of
the firm.
Question 2
Strength and Weakness of the legal frameworks
As implied by Turban et al. (2017), the strengths and weaknesses in the legal
frameworks of an e-business describe the whole nature of the work of an online business.
This is because the online business does not have an established business firm where it's

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business proceedings takes place. In this case, the legal framework chosen for the concerned
new online store is analysed as Customer Right Framework. The Customer Right Framework
states that a business entity should plan their strategies according to the interests of the
customers. This ideology sets the focus of a business to be significantly customer oriented. In
this connection, the strengths and weakness of the Customer Right Framework are specified
as below.

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Strengths Weaknesses
The company will be able to earn better
satisfaction of the potential customers.
The implementation and execution of the
legal framework is a massive challenge for
the company.
The customers will feel safe and secured to
invest in the business because of its legal
nature.
The cost of investment of the company
increases because of the accountability to
various laws and orders of the legal
framework.
The customers will be retained in the
company for a more extended period of
time.
The failure of the legal framework may
harm the sustainability of the company in
the long run.
The efficiency of the Customer Legal
Framework will help the company gain a
better paradigm in the market of the e-
commerce business.
Any disrupt in the legal framework may
lead to accountability of the firm towards
facing the legal considerations and may also
result in the termination of the company
from the online business market.
The customers would remain loyal to the
company because of the significant focus of
the company towards the fulfilment of the
desires as well as the safety of the same.
The company’s prior focus would remain on
the desires, needs and rights of its potential
customers. In this connection, the other
crucial factors of the business may be
disadvantaged because of the same.
Funding for the business
Financing a business is considered to be one of the most vital fundamental aspects of
a new startup plan business (Porter and Kramer 2019). Based on the study of this particular

9NEW STRUCTURE OF ONLINE BUSINESS
report, it was examined that there are various means and methods of funding one's online
business. In order to start up new entrepreneurship the proper planning to do the same shall
study the market structure that helps in the funding for a new to be established the business.
Although there are many terms and conditions to be followed for the same. In this regard, the
funding methods selected for the newly structured business are considered below.
Figure 1: Determining the source of funds for the start-up business
(Source: By Author)
Government
Funds
Crowd
Funding
Loan from
Bank
Self-Funding
Financial
sources to
start up the
business

10NEW STRUCTURE OF ONLINE BUSINESS
 Looking out for the grants from the government. The government provides grants to
business enterprises depending on the size of the business. The same is offered on
three levels – federal, state and local level. These grants serve large, medium and
small and medium sized business enterprises respectively. However, many terms and
conditions are applicable in terms of applying for the same.
 The new option of crowdfunding can also opt in order to start up the new business
structure. Specifically, crowdfunding works with the ideology of taking a contribution
or an amount of loan from one or more person at a point of time. The persons from
whom the funds are to be raised can be anybody unknown or a relative.
 The funds may be raised by applying for a loan from a bank which supports the start
up a new business. The bank funds the business after analysing the background of the
entrepreneur and after fulfilment of several legal considerations and charging a rate of
interest for the same.
 The company may also foster self-funding to avoid the risk and consequences of
uncertainties that may occur while funding the business from different options. Self –
supporting the business will ensure the entrepreneur about the money in hand.
However, there lies some amount of risk while being funded by others. It also will
help the business from eliminating the payment of interests if the fund is raised from a
bank or any other funding agency.
Question 3
Sectors of Operating the business
Based on the above shreds of illustration, the study tends to examine the sector in
which the new company would operate in terms of the United Kingdom to provide its
products and services to the targeted market and therefore gain revenue and make a profit
from the same. The sectors of operation for the new online business are determined as below.

11NEW STRUCTURE OF ONLINE BUSINESS
Figure 2: Determining the Sectors of Operation for the online business in the UK
(Source: By Author)
As illustrated in the above diagram, the three sectors of operators that are examined
for the future undertakings of the business are Food and Beverages, Electronic Appliances
and Clothing. The three sectors the business is to be operated on is different in nature and
factors. In this connection, the difference between the three sectors recognised is explained as
below.
Food and Beverages
The food and beverages sector comes in the hospitality industry that engages multiple
ranges of activities. It starts from purchase of required raw materials, sustaining the
inventories of the material, preparing the final food and beverages to be served and
maintaining the quality of service continuously. Specifically, securing the purchase of the raw
Sectors of
Operation
Food and
Beverages
ClothingElectronic
Appliances

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materials to offering the same to the customers in order to manage the different needs of
different tastes and preferences of the targeted customers. The food and beverage sector in
the online business means to provide food directly to the end customers or hotels and
restaurants that deals with the end consumers. This sector deals with satisfying the basic
needs of customers to eat and drink in their daily lives. However, the customers in the current
date are getting strictly conscious about their health and safety, and they choose their food in
accordance with staying healthy and fit. The sector of food and beverages are at a high risk of
getting maltreated with chemicals and harmful preservatives. Customers at date prefer non-
oily foods, diet and healthy beverages as well as food with fewer calories and fats. Moreover,
people with premium income prefer organic food materials as they do not include
preservatives and harmful chemicals that are generally adulterated in natural food products.
Therefore, the company should highly concentrate on providing their customers with non-
contaminated food products and beverages.
Electronic Appliances
Dealing with electric appliances comes under the industry of retail as well as a
commercial industry. The electronic tools can be any product that deals with the home as well
as the commercial offerings. These appliances can be classified into primary and small
appliances for both home and commercial use. The company can deal with the latest
electronic devices to deal with the changing demands of the customers and technological
advancements in the electronics department. This sector satisfies the entertainment needs of
the customers. The financially stable customers have more chances to opt for the purchase of
the standardised electronic products for both home and office as per their needs and
requirements. The technology in the sector of electronic appliances keeps on modifying and
innovated at a constant rate. The versions of the appliances keep changing as per the needs
and desires of the end customers. Therefore, dealing with a new business in the sector of

13NEW STRUCTURE OF ONLINE BUSINESS
electronic products would prove a challenge for the company. Moreover, the servicing part
related to the goods after serving them to the end customers also becomes a responsibility for
the company. The sale of the product will not be enough for the company; altogether the
company needs to deal with the complaints and feedbacks of the customer after that.
Clothing
The clothing industry comes under the dealing of the textile industry. This sector
serves the chain of garment and apparel that starts from producing clothes related to cotton,
wool, fur and even synthetic fibre clothes. This sector deals with both the basic needs and
standard needs of a customer. This is because the people with a lower level of economy
prefers to buy clothes that would fulfil their daily requirements of sheltering themselves and
the premium customers prefer fashionable brands and clothes that would satisfy their
psychological needs of lifestyle and modernisation. The company can directly deal with the
customers interested in purchasing the garments or even deal with the retailers and the
wholesalers who deal with the garment sector. The company needs to be efficient and
effective to provide its customers with proper quality clothing. In this connection, the
company has to set suitable manufacturing units that would produce garments to fulfill the
needs of the customers. This sector has a high risk of customers being unsatisfied with the
material of clothes since they are not purchasing the same physically. Thus, to retain the
business sector the company has to have a clear focus on the quality of the clothes produced.
Value of the sectors to the economy of the United Kingdom
The value of the three different sectors contributes to the economy of the United
Kingdom in the way that it helps the growth of the GDP of the country as a whole. The three
sectors of clothing, electronic appliances and food and beverages fall under the top three
sectors of the exports and imports of the United Kingdom. This is a piece of clear evidence

14NEW STRUCTURE OF ONLINE BUSINESS
that the areas chosen would increase the economy scale of the United Kingdom and help the
government of the UK earn a better amount of tax rate. Researches show that 54.2% of the
economy of the UK comes from the textile industry, 23.1% comes from the electronic
appliances and a rough of 15.2% comes from the food and beverages sector. However, the
risk lies in the online business because of the nature of fraudulence remains to be high in the
field of online store. Several analytical data reported a high amount of fraud that occurred
because of the purchase transactions made in the online industry. Therefore, the company is
liable to remain under the legal framework and avoid the misuse of its business proprietary to
take undue advantage of the customers and fool with online purchasing. The company should
deliver what it promises to. This will keep the image of both the company and the country at
a useful paradigm and vice versa.
HR Policies
Based on the above examination of the given report, the crucial factor that comes into
light is the hold of the responsibility of these factors. The accountable individuals for all the
mentioned sectors and elements are the human resource management team of the company.
The HR is the crucial part of any business entity in the case that they handle the complete
undertakings of the plans and processes of the same. The HR department of any business is
the liable managers from setting the strategic plan to implementing and executing the same.
In this connection, the policies that an HR department is responsible to concerning an online
business entity is examined as the policies regarding the health and safety of the employees
as well as the customers connected to the company. Not only this the laws and considerations
of the legal framework and the protection of the environment is also the responsibility of the
HR. The Human Resource policy also lays to maintain a healthy and unbiased working
environment for all the employees working in the company. These illustrations straight away
describe the importance of Human Resource Management in the modern era of running a

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business. This is because the HR deals with the development of the company, the rules and
orders that maintain the legal balance of the company as well as managing the complete
organisational team and culture of the work of the organisation.

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Appendices
The study of this report made me understand the challenges that are to be faced in
order to set up an online business firm. Setting up a business is not as easy as it seems. No
individual can become a renowned entrepreneur overnight. In order to set a business an
individual needs to recognise the potentialities and skill the person owns. The individual
needs to analyse the opportunities recognition to get ideas for the setting up of a business
firm. After the generation of the concept, the person needs to identify the area of setting up
the business. I certainly felt that there are several limitations in setting up of a business firm.
The restrictions that I felt are crucial were the intervention of the government and other third
parties. The legal framework, taxation policies and rates of trades and interest of the
government policies also play an essential role in setting up an online business firm. I also
realised that an individual planning to come up with an online marketing strategy has the
accountability to adhere the strict rules of the protection of the consumer data and
fraudulence because several reports regarding the hack and misuse of the same are reported
every annual year. Therefore, I feel that before planning to set up a business an individual
should study the complete market structure of the online business environment and
understand the pros and cons of the same that would help them in creating a strategic plan for
their new online business.

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