Business Environment: Types of Organisations, Stakeholder Objectives, and Economic Systems

Business Environment

Introduction:
Business environment includes all the surrounding of the business that affect their functioning
and behaviour. This unit focuses on the study of various factors of the business environment that
leads to change in the behaviour of the business accordingly. This unit focuses on discussion of
the type and purpose of the organisations in UK. Further, it discusses about various stakeholders
that are associated with the organisations and the responsibilities of the organisations towards
them. It also discusses about market forces like demand and supply and how they affect the
decisions of the organisation. This unit also throws light on the perspective of change in demand
and supply on pricing. Business environment of the organisation is formed by global factors that
will be discussed in this unit briefly. The last part of this unit discusses about the impact of EU
legislation on UK based businesses.

Task 1
1.1 Identify the purposes of different types of organisation.
Not all the organisations in the country work similarly. They have the categories according to
various factors. One of the factors is the ownership of the organisation. According to ownership,
organisations have been divided into various categories. Some of them are discussed below:
1. Limited company: Limited companies are owned by shareholders. Private limited
companies do not offer their shares to public while public limited company offer the
share to the public also. For example: Brakes group it’s a UK based food company and it
provides food to the local people.
2. Sole traders: Sole refers to single. This suggests that sole traders are the organisation run
by single owner. These organisations function generally at small scale. For example:
Portlock and company which provides it’s customer accounts related advice and helps to
achieve business and financial goals and objectives.
3. Co-operatives: The people from the public associate and form the company for serving
the public only. (Adekola and Sergi, 2007)
4. Franchise: It is the type of organisation in which, owner company grant permission to the
local company to run their business in that area.
5. Partnership: It is the form of organisation where two or more than two people share the
liability and profits of the organisation and act as partners.
For example: John lewis partenership PLC provides happiness to all their members and
satisfy their daily needs.
This case is about a private limited company known as, Primark. Primark is a retailer company
that serves its customers by acting as the mediator between the manufacturer and the customers.
Purpose: Primark is a retailer in fashion business that does not produces the products with
themselves but depends on manufacturers for that. The core values of the company believe in
ethical framework of the business. These core values are

1. It is a people oriented organisation
2. Focuses on maintaining the ethical work environment for the employees.
3. They are not only responsible for their employees but focuses on educating the workers
working with their manufacturers.
These ethical practices by the company defines it pure objectives. Corporate Social
Responsibility is the area of work that has also been focussed by the company. (Aras and
Crowther, 2011)
Type of organisation Company name Purpose
Public limited company NHS NHS is incorporated for identify
excellent high school students. This
organisation identify those brilliant
students who are perfect in different
sectors are like scholarship, leadership
and services. Worldwide more than one
million students can participate in NHS
for improve their activities in school
time. It provides healthcare services to
every person it can reach. Services like:
emergency and infectious diseases
treatment which is available free of costs
including visitors. In this organization
amount contributed by national
insurance and it’s major is funded from
general texation
Charity The British Red Cross This charity firm is purely into provision
of health and support to the population
of Britain. The company aims at
providing help to the people in
emergency. The values of the company
suggest that they are courageous,
dynamic and compassionate towards
helping others.
Co-operatives Clydebank co-
operative society
Clydebank cooperative society
registered in Scotland. The main purpose
of it is provide food to consumer. It
operates six food store. Clydebank
develop all their stores to attain its
objective. It attracts more consumer
towards their food. They want to
enhance and promote their food product

in a worldwide. Its official
unemployment rate is 6 % however 20%
of the population are employment
deprived. Clydebank owes its origin as
wel as mushrooms to ship.
1.2 Describe the extent to which Primark meets the objectives of its different stakeholders.
Stakeholders: Stakeholders are the supporters who support the business to exist. They are
associated with the organisation in one or the other form. The practices of the organisation affect
its stakeholders and vice versa. This is the reason they are very important for the functioning and
existence of the organisation. Primark for their stakeholders takes the responsibility of it’s
workers. To keep working with their stakeholders they maintain the financial condition.
Types of stakeholders:
As far as Primark is considered, this organisation has internal as well as external stakeholders.
Internal stakeholders are the one who are closely associated with the organisation like
shareholders and the employees. The external stakeholders are associated relatively less closely
to the organisation. These consist of customers, suppliers and workers in the case of Primark.
These stakeholders have the give and take relationship with the organisation. Stakeholders like
shareholders provide funds to the organisation and organisation provides the profit in return.
Therefore, both the parties remain in benefits. All the stakeholders have different needs and
Primark has different responsibilities towards them. (Avadhani, 2010)
Stakeholder’s objectives that needs to be met:
1. Shareholders: Shareholders are the stakeholders that are most closely associated with
the organisation. Shareholders of Primark have some of the shares of the company with
them. They are the internal stakeholders.
Objectives: Shareholders are the one who invest capital in the organisation and the
organisation needs to return appropriate amount to them. (Cherunilam, 2010)