Impact of Culture, Environment, and Business Environment on Business

This report discusses the impact of culture, environment, and business environment on business operations and performance. It includes a PESTLE analysis and SWOT analysis of Primark, a fast fashion retailer company.

Organization and Business
Environment- report

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Impact of culture, environment and business environment on business.....................................4
Pestle Analysis.............................................................................................................................7
SWOT Analysis...........................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business environment can be defined as the sum of overall factors internal and external
which gives impact on business functions such as employee, management, customers, supply and
demand and norms of business. It supports organization to grow in the business market and
accomplishes overall objectives which supports to gain goal of the company. Internal and
external factors which affects organization operation inside and outside. These factor declines
thee efficiency of organization entity for achieving core competency in the global market by
compete with other giant companies. Business environment is not supporting organization to
identify it’s environment but also helps to seek out business opportunity that leads effectiveness
in business operations effectively. Those factors can be economical and non-economical which
gives impact on organization goodwill. It evaluates overall resources which influences decision-
making process to become market leader in the business market. with organization environment
easy to generate effective possibilities to perform deep market research and enhance advance
information to innovate as per the need and wants of the stakeholders. External factors include
political, economic, socio-cultural factors, technological, legal and environmental factors which
indirectly affects business activity and assist to expand business in other countries by
overcoming external threats. In addition, these factors directly affect economic infrastructure of
the nation that also supports to enhance the potential of the country for growing and offers
effective development possibilities for organization in market place to generate high profit
margin on the products or services positively (Aithal, 2017). As same hypothesis implements for
internal business environment which affects business organization in several terms i.e.
organizational infrastructure, technology, business culture, customer and employees’ behaviours
and especially human resource department which supports company to create objectives and
achieves them over the period. Apart from this, productivity, performance and profitability of
organization is properly based on the economic environment in which organization operates in
(Yunus, 2016).
To understand role of business environment within company has an example of Primark
company. It is an Irish fast fashion retailer company which is headquartered in Dublin, Ireland. It
is subsidiary of food processing and retail company of ABF. Organization offers wide variety
products i.e. clothing, cosmetics and housewares to customer in different countries.

The brief study of the report understands business environment of the Primark to identify
the impact of internal and external environment on the business. The main mission of the report
is to give detailed understanding for influencing natural environment, culture and business
nature of the company in developing brand image and stakeholders effectively (Barugahara,
Maumbe and Nzaro, 2019).
Impact of culture, environment and business environment on business
Business environment
Organization culture is important for any type of business because it supports to integrate
staff to enhance the shared value towards goal of the company for gaining it’s objectives
effectively. It improves performance of the workforce by inspiring them and improves their
personal development to perform effectively in decision-making pro0cess to achieve expected
outcomes positively. A god culture leads healthy environment of the business and enhance the
quality of work along with better coordination of morals and ethics which are used by leader and
manger to beco0me ideal leader and manager. Primark is a retail industry which offers wide
variety products to the customer in the different countries. So, it understands significance of
organizational culture and evaluates overall internal and external which improves the
organizational behaviours to affect overall productivity, performance of the business. Primark
can identify different companies’ power, politics and culture effectively by implementing of
strategic plan. To understand culture of organization is very crucial for business to evaluate all
factors for getting effectiveness in decision-making process and improves quality of the business
activity positively. The main aim of the Primark to improve brand image in the business market
and gain competitive advantage from big super market companies i.e. Tesco, Morrison, Asda,
Sainsbury and Aldi & Lidl. These companies offer similar products to the customer and captures
68.7% shares of market in the UK. There are several objectives of the company which are
created to meet goal over the time. Financial performance and its resources play effective role
with in business because when they have good funding sources along with approach then can
perform operation effectively and gains higher market perceived values in the retail market. It
becomes difficult for the Primark to attain leadership in the retail market and maximize profit
due to large number of supermarket competitors in the UK market (Chen and et.al., 2017).
Economic Environment

Economic environment is very essential for organization because it affects business
activity and crucial to determine overall factors to enhance its efficiency in the retail market and
achieve high profit margin. Economical factors are not controlled by the company that declines
the power of business in market negatively. It supports to understand the market attractiveness
for developing market strategies to increment sale infrastructure of the business. Economic factor
gives impact on organisation growth because it directly affects financial performance of Primark
and declines its growth possibilities in market (English, 2017). External factors impact on
organization which reduces power of business in the retail market. It impacts economic growth
and business activity indirectly. Brexit impacts the economy of UK country due to various
changes in the policies, exchange rates, inflation rates, change in disposable level of
stakeholders, unemployment rates that has reduced purchasing behaviours. The reason behind is
that lack of liquidity in the UK market which has enhanced it’s cost of Primark along with higher
employment rate. currently organization faces difficulties to recruit potential employees because
there are shortage of intellectual employees in the UK market. These kind changes affect buying
decision of customers and lifestyle of users for avoiding spending extra cost. Even this situation
like recession has created in 2008, which decreased the global economy and failed small-medium
enterprises to sustain because they got heavy losses and required high cost to operate business
activity in the market positively (Todorović, Živković and Haznadarević, 2018). So, it is crucial
for company to evaluate these factors and develops products or services as perv the situation to
generate high profit margin on the products and change in customer’s purchasing behaviours to
enhance economic growth effectively. Organization leads change in their business activity based
on the overall factors and achieves higher market in the UK market. Cashflow rate is declines
due to low income rate in the market which also affected UK for attracting investors to take high
funds for investing in business expansion and innovation of goods and services.
Non-Economic Environment
It contains several factors i.e. culture, natural, demographical, technological and political
factors impact business in both manner indirectly and directly. Organization requires to
understand impact of these factors which can enhance the growth opportunity of business in
other countries as well. Non-economic factors affect purchasing behaviour of customer in the
company because customer always expect that they get values of their money. Primark is an Irish

fast fashion retailer company so it is very important for organization to be updates for non-
economic environment which improves product efficiency and achieves high revenue of
company.
Culture Environment
Primark has good organizational culture within company because they have good
strategic management staff who helps to take better decision and develops strategies for business
so that they can have a better functioning activity for themselves. In the company, leader and
manager works together so that can take effective decision for achieving expected outcomes.
Leader of the Primark is very flexible with time which reduces pressure on employees so they
can give high performance in the company. It supports organization to enhance it’s productivity,
performance and profitability. Manager and leader always introduce different activity for
improving employees engagement which maintains their wellbeing and motivates workforce for
them so that can apply their skills to have a better profitability for themselves which
automatically will supports company to gain competitive advantage (Esteban-Escaño and et.al.,
2017). Company offers incentives, bonus and extra privileges to individual on the basis of their
efforts which they put in the company to generate profit. 360 feedback strategy also use by
leader to gather feedbacks form customer and employees which helps them when they take
changes in the organization infrastructure and others so that company can perform their function
effectively and smoothly.
To create healthy working environment within company requires to offer these privileges
which employee expects from employer so that Primark can have better function in business
market (Sutrisno and et.al., 2016). Changes are very compulsory in a company because users
need and preferences keep changing from time to time that company have to peruse trends so
that can gain competitive advantage. Employees has great loyalty for organization which major
strength because it helps to raise brand image in the business market. Manger plays essential
major role in Primark company by recruiting best talent which can comply with particular job
and gives better functioning which is make to going business effective in the retail market.
Primark has great stability in retail the market because it has string brand image because
they meet customer’s needs and preferences on time that develops loyalty of customer on the

brand. Organization operates in different countries but language never become barrier for them
because there are lots of translator facility which provides by organization to clarify goals and
objectives of the company to the staff. Organization promotes fair treatment in the company
while assigning task, in promotion policies and others which creates loyalty of employees to
have better functioning. Primark introduces club card strategy where offers club cards to those
who buy products regular basis. Club card keeps customers happy because they get discount on
shopping and attracts new customers as well (Irfan and et.al., 2019). Wellbeing development
program also promotes by organization in the workplace so that employees learns to stress
management in different situation and maintains their wellbeing within business. It shows
organization has well-organized culture which causes has strong market of company in the UK
market.
Natural Environment
There are lots of environmentalist’s issues which leads financial losses in 70% businesses
and majorly affected by weather of country. There are fewer resources which are available
globally and to be used wisely by the organization. The reason behind is that organization wants
to long run in the market so that they restore them and use them when they require. It is very
essential for the staff and customer that organization must well maintained. Generally, company
founds other alternative resources which they ca restore and reuse them accordingly customer
demands. They use resources wisely and saves them for users. Th reason behind is that wants
give high quality products and services time to time (Nogo and Škrkar, 2018). Financial
performance and technology performance is more good in UK which helps company to approach
new customers and retains existing customers and in return generates high revenue within
business. UK’s government implements various policies for MNC companies which operates in
retail and manufacturing market so that they can improve environmental wellbeing. Organization
follows overall policies so that can easy to cope up with them and develops loyal set for the
customer on the brand and its product. sustainable product strategy follows by organization
which lead quite effective resources within company for example initially it puts pressure on
competitors, raises good will of company and improves purchasing decisions of customers for
products or services.

Pestle Analysis
It is strategic tool which is used to analyse external environment of business and it’s
factor impacts business performance. This model is used to analyse external environment of
Primark which is described below:
Political factors
There are lots of political opportunities for company in various markets that can
enhances their market establishment positively. Currently, Brexit leads lots of change in the
policies and political instability as well in the UK which can give major impact on Primark’s
operations, profitability and productivity. In addition, Brexit leads political change in foreign
trade policies which adversely impact on business profitability because they can’t accomplish
core competency in the UK market.
Economic factors
Recession period has affected the economical growth of UK while inflation rate
increased. Apparently, it has affected organization for surviving in the business market along
with lack of cash flow liquidity and increase interest rate. Brexit enhances the foreign exchange
rate of currency and enhance ratio of unemployment rate (Kemunto, Shitseswa and Ondiek,
2020). it can give impact on organization performance because they unable to offer premium
product to different customer.
Socio-cultural factors
UK is highly updated for new technology so, social trends of online shopping is quite
high for customer. It can give golden opportunity to company because they can improve it’s
current market share, productivity and profitability in the business market. Tesco can improve
online store capacities and sells their products through digital channel to users which can support
company to capture who new market and puts pressure on market competitors.
Technological factor
The current growth and innovations in emerging technology. Primark has many
opportunities to improve their business operation and efficiency as well. For example, currently

self-checkout container is new technology in UK which organization can install in their physical
stores. It can take high installation cost but it will decreses staffing cost and become highly
profitable for organization to long run in retail market.
Legal factors
There are several legal factors i.e. health and safety of employees and labour laws and
wages which are legally mandated in the UK for MNC’s. To operate legally in the market,
Primark has to adhere overall legal policies where these laws keeps workforce motivated and
self-actualized for the staff. To adhere these rule and regulation enhance cost for company but
reduces organization operational profitability in the UK market.
Environmental factors
UK’s government and Public raises concerns for environmental issues in the country. So,
organization has adopted environmentally sustainable operational practices which can be proved
costly for the organization when they are legally authorised by the governmental authorities.
SWOT Analysis
It is strategic approach which supports business to determine it’s capabilities, resources,
threats and weaknesses within company.
Strengths
The organization operates its own 157 retail outlets which are established across the UK
country (Nasehi, Allahyari and Zebardast, 2017). To attract customer organization offers
affordable quality products that supports to retain different type of customer with the business.
Ethical trading initiative is taken by the Primark which supports to access on users right, it’s
good products and works on employees or labour right in the organization. Primark overtakes the
Arcadia Group to gain third position as largest clothing and footwear retailer in the UK market
(Mishra and et.al., 2019). Organization has successful expansion in japan as well which is great
success for business that upgrade brand position in global market. It has strong brand reputation
such as successful value retailer.
Weaknesses

Organization doesn’t use any advertising media and it’s social media presence is quite
less or weak as compared it’s competitors. Primark retails trendy clothes at amazing prices while
most of the customer complains that it has low quality products along with no unique style.
Primark’s primes have poor working condition and disrespecting of workers’ rights are different
issue which are major issued.
Opportunities
Growth of online commerce is major opportunity for organization because they can
expand clothing sector ad can serve in the market. Organization retails their products in eleven
countries through their stores across the Europe and United State. Even organization has
opportunity to expand its business in Slovenia, Poland and Czech Republic.
Threats
Brexit causes adverse transactional effect which impacts profit margin of products or
services. Continuous change in users shopping habits for sustainable products and they turns way
from cheap fast fashion can become threat. Matalan, Peacock and New Look etc. are the market
competitors which poses threat for the business.
CONCLUSION
The report gave understanding about business organization which influences shaping of
business behaviour to meet its objectives. It was crucial to determine impact of culture for
improving effective structure of the organization to generate high profit and enhance quality to
take right decision. The brief study of the report gave effective information that culture of the
business improve capacity of internal resources for creating proper strategies which includes
employees who supports business to attain better opportunities and gain competitive advantage
from competitors in the UK market. Primark had to create strategic plan for gathering
information about different environment factors that could affect business activities. It supported
organization to increase quality of it’s product or services to generate higher profitability and
goodwill as well. To evaluate economical and non-economical factors assisted business to
understand effective market evaluation and formulated effective marketing strategies which
improved it’s financial performance positively. The report has been discussed about political,

economic, socio-cultural, technological, legal and environmental factors which has impacted
Primark in the UK market in different ways that declined business performance for competing
with potential market competitors like Matalan, Peacock etc. Primark had aim to develop good
culture in company so that employees supported company to led satisfaction in customers to
offer desired products and in return generated high profit margin on the product or services. It
was crucial for company to followed marketing analysis strategy to identify it’s current change
and trends of users for enhancing their satisfaction and inspired them to become loyal for
company by inviting them in customer loyalty program. Business environment supported
company to improve their awareness about overall issues and problem of customer which they
found in goods and its services. Organization solved these issues by adapting digital marketing
tools. Thus, organization captured high market share positively. Primark also understood the
changed trend in customer for shopping and in food segments so adopted sustainable products
strategy. this report also supported organization to create higher perceived valued for users and
employees that retained them in the company prolong time and maintained internal environment
of business as well. The brief study of the report has been portrayed impact of Brexit on UK’s
economy and performance of business in sustaining in the retail market for capturing larger
market share. Even UK’s government has been enhanced interest rate of in loans that directly
decline the profit margin of business for operating in a giant market and raises brand images
effectively.

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