Impacts of Internal and External Environmental Factors on Primark

Introduction
This study is based on Primark; an Irish fashion retailer offers qualitative
clothing,
Cosmetics and house wares. It is going to discuss impacts of internal and
external environmental factors such as: strengths, weakness, political
factors, environmental and others factors. It will further discuss different
ways by which company can impact on external environmental factors.
Primark
External environment Political PESTLE analysis: Along with internal factors analysis, it
is important to analyse some external environmental factors and developing
strategies accordingly. Some external environmental factors that may affect on
performance of Primark include: Political: There are some countries where political
stability and political situations are in favour of fashion industry but in some countries,
there are constant conflicts caused by friction such as China. So, operating in China is
difficult for Primark as it find difficult to understand laws and legislations of China. But
there are several other countries where government support fashion industry and
help them out in increasing sales for improving economy.
Economic: Economy of developing and developed countries is slowing down and it is
affecting overall performance of Primark. One of the main examples of poor economy
is: Covid-19 pandemic. Due to this, people are less likely to invest in clothing and they
are focusing on buying essential materials only. So, it is affecting its sales and profit
margin as well. Social: Changing needs of people is one of the main social factors that
are also affecting its performance. But Primark is known for its qualitative and unique
fashionable clothing. Technological: Technology is having critical impacts on overall
performance of company. There are several companies in this industry that makes use
of technology to the great extent for maintaining quality. Primark also makes use of
advanced technology. But it is found that Primark has lack of online presence and
currently it does not offer online shopping and customers need to visit its stores for
buying products. Legal: There are some trading, tariff, taxation, wages and others
policies. It is important for company to comply with all laws and regulations in order
to protect itself against lawsuits and others. It found that Primark complies with all
laws and it makes it able to improve image and operating business in several countries
in an effective manner.
Environmental: It is all about corporate social responsibility and sustainability and
customers also prefer to buy products from companies that maintain sustainability. It
is found that Primark has promised to reduce carbon footprint and also decreasing
wastes. It can help company in improving image and attracting customers to the great
extent. So, on the basis of above discussed external environmental factors, it can be
said that there are numbers of factors that can affect it in negative manner. So, it
needs to develop its internal strategies in a manner that can make it able to perform
functions in other countries with effectiveness.
How the company impact its context External Environment
Complying with laws: It is found that Primark comply with all laws and
regulations of all countries. Different countries have different
legislations. An ability to comply with all laws is having positive impacts
on legal factors. It is beneficial for both company ad societies as it can
protect it and employees against lawsuits. Also, it satisfied legal factors
that are also good for all.
Promoting sustainability: From internal environmental analysis, it is
found that company is heading towards sustainability and has promised
to decrease carbon footprint to the great extent. This initiation and step
towards protecting environment is having positive impacts on external
environmental factors. This initiation can help in reducing pollution as it
makes use of TQM and other approaches for decreasing waste.
Promoting technological environment
Primark believes in using technology in their production services so that
they can provide better products and customer services and also
enhance the customer satisfaction with the help of using new and
modern technology. But on the other hand this company also believes
that it should not impact environment by using Technology therefore
they are working for the Welfare and development of environment.
This company is working for promoting and improving the graphical
factors such as climate conditions weather etc. This factors impacts the
profit and also it influences the business.
Internal Factors
Business environment is made up of internal and external factors that may
affect overall performance of companies. For growth and development, it is
important to analyse all factors. SWOT tool can help in identifying internal
environmental factors of Primark, fashion retailer such as:
Strengths
Primark offers varieties and ranges of products including women wear, men
wear, accessories and others.
It relies heavily on word of mouth publicity that helps in decreasing cost.
It is successful in increasing sales every year.
It has around 50,000 skilled employees.
Weaknesses
Slow economic growth of EU affected its profit margin.
Poor quality of products that are being outsourced is another main
weakness.
Opportunities
Opportunities to expand business in Middle East, India, South Africa and
others.
Increasing profit margin from sportswear because of increasing demand is
another main opportunity.
Threats
Majority of stores of Primark are in Europe and its sales majorly depend on
economy of EU and it can create barriers.
Lack of presence in emerging markets.
Increasing competition from Zara and other brands.
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