Business Environment Analysis Report

This report analyzes the business environment of FRA-PAS Frozen Yoghurt Shop, a partnership venture selling frozen yogurt in Birmingham. It examines different business organization types, applies the concept of partnership, and explores the impact of macro-environmental factors on the business. The report also utilizes Porter's Five Forces model to analyze the competitive landscape and identify potential threats and opportunities for the company. This report is available on Desklib, a website providing past papers and solved assignments for students.

Individual report
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Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Different type of business organizations and apply to partnership........................................3
Macro environment and impact on business..........................................................................4
Analyse the case and also use the Porter's 5 force.................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8
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INTRODUCTION
Business environment is considered as an important aspect which may include internal
and external factors that may directly impact on the overall performance of the company at
market place (Javeed and Mukhopadhyay, 2017). In this context, Present report is based on the
case study of FRA-PAS FROZEN YOGHURT SHOP which is given by Frank Jones and his
partner Paddy Jackson. Mainly it is an ice-creams parlour which deal in selling frozen yoghurt in
Birmingham. Report cover partnership style for establishing as well as running this type of
business at market place. Macro environment and its impact on the business activities is also
mentioned in this report. Along with this, Porter's five force model is discussed in this project
which may help in analysing as well as evaluating the competition at market place.
TASK
Different type of business organizations and apply to partnership
Fra-Pa's Frozen Yoghurt shop is famous ice-cream shop and also specialised in frozen
yogurt. As it offers quality ice-cream to the young children, adults and teenagers with the aim of
attracting them towards product and services. This company is run by two partners as they
equally contribute in the launching new business with the hope of generating larger market share.
They start a new business with the capital of £30,000 and some working capital pay to the
suppliers to purchase the quality and enough stock to improve their performance. In context of
this, Fra-Pa's Frozen Yoghurt in dilemma which is relate with the strategy of adopting low price
products and focus on quality organic products at premium rate. In this both partners follow
effective and general partnership in which both partners contribute equally which may help them
in attaining success. There are are different types of companies running in present scenario
which are given below –
Private organization: This sector of business is operated by the common person with the
aim of earning larger profitability. In addition of this, it is related with the partnership or solo.
Fra-Pa's Frozen Yoghurt is considered in sector in which they run business with the purpose of
attaining higher profitability.
Public organization: This type of business organization is operated by parliament. In
context of Fra-Pa's Frozen Yoghurt is not coming under this organization. As this organization is
operating by two partners with the aim of generating larger profitability.
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Voluntary organization: The main purpose of this type of business organization is to
improve social welfare by providing better services to the customers as per their requirements.
This will help in improving living standard of the individual within the society. Fra-Pa's Frozen
Yoghurt is not consider in this type of organization. In this context, the main aim of Fra-Pa's
Frozen Yoghurt is to offer organic products to customers for earning higher profitability.
Macro environment and impact on business
It is important for business organization to analyse macro environment while executing
their activities in market place (Van Wormer and Besthorn, 2017). In context of this, Fra-Pa's
Frozen Yoghurt needs to analyse the impact of the macro environment on performance of the
company. With the help of this they can easily improve their competitive image at market.
Political factor: It is one of the important factor for business organization which directly
influence entire activities of the company in both positive and negative way. In context of Fra-
Pa's Frozen Yoghurt, they have to follow all the political rules and regulations at the time of
operating their business. By this they can easily produce best quality products and also invite
large number of customers towards its products i.e. organic ice-creams and another product as
well.
Socio- culture factor: For improving performance level of the company, it is important
for Fra-Pa's Frozen Yoghurt to identify every type of customer’s needs, wants and requirements
before providing them services. As it helps them in enhancing their market share form its rivals
and at the same time also capture customers attention towards its organic products. Along with
this, customer’s satisfaction may support Fra-Pa's Frozen Yoghurt to established their
competitive image at market as compare to its rivals. The given company should take care about
socio- cultural values of customers while promoting their brand and completing their
requirements appropriately otherwise it may create social problems for company.
Economic factor: This type of macro factor plays important role in business activities as
it includes various factors like GDP rate of the economy, tax, inflation, customers spending
pattern and so on (Kormishkina and et.al., 2015). Thus, it is vital for Fra-Pa's Frozen Yoghurt to
consider all the factor at the time of serving as well as producing its organic products. With the
help of this, Fra-Pa's Frozen Yoghurt can easily gain future opportunities to enhance their
positive brand image and at the same time also increase customers base as well.
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Macro environmental factors play crucial role in analysing the positive and negative
impact on the business activities. Thus, Fra-Pa's Frozen Yoghurt needs to consider all the factors
in business activities for making their brand image more popular and competitive at market
place.
Analyse the case and also use the Porter's 5 force
Every business organization wants to establish their competitive image in front of
different competitors for attaining success. As per today's market changes are rapidly taking
place in market which directly impact on the business activities in both positive and negative
manner. Thus, it become more important to analyse competition at market and at the same time
also define actual performance as well (Porter's Five Forces: Analyzing the Competition, 2018).
For attaining the same, company needs to implement the Porter's five forces model that
contribute in determining the potential profitability level of the company at marketplace. The
main advantage of using this model is to analyse the industry competition so that business can
easily improve their performance level as compare to its rivals. In context of Fra-Pa's Frozen
Yoghurt Shop, they can determine actual competition level of market and trends of market so
that they can apply appropriate strategies to sustain their growth respectively. As company facing
dilemma related with their yoghurt supply. In this on the one hand they attract customers by
services products at low price. On the other side, they produce fresher organic ingredients and
experiments with premium products that would be effect on their price ad margins as well. This
is beneficial for the company to retain their competitive image in market for longer period of
time. With the assistance of this, they can easily invite large number of customers towards its
offering product. For this context, company use Porter's five force that may help in effectively
analyse their competitors at market place along with analysing effects on relevant industry i.e.
food & beverages. This can be understood by following points:
Competitive rivalry: It is an important factor for company to evaluate the actual
competition in market. In this, Fra-Pa's focus on two type of situation one of low pricing of
products and another one premium pricing for developing their overall profit margin. Thus, it is
important for the company to focus on aggressive customers that directly impact on the overall
profitability of the company. In case of Food & Beverages industry, it is observed that high
concentration as there are companies for belongs to every productcategory and very little scope
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for price appreciation is analysed. Moreover, high rivalry is evaluated amongst existing
competitors in this industry.
Supplier power: As Fra-Pa's is strong related with the financial condition in which they
have enough capital to purchase raw material for number of suppliers. It directly impact on the
suppliers as they increase their prices of the raw material for the company (Burns and Dewhurst,
2016). The Food & Beverages industry depends upon agricultural products for its raw material
and relevant companies has fewer options due to increased cost of imported products.
Additionally, suppliers have moderate bargaining power.
(Source: Porter’s five forces of competitive position analysis, 2018)
Buyer power: It is important for the company to analyse the customers power towards it
products and services. As Fra-Pa's Frozen Yoghurt focus on customers taste and preferences
towards its organic products. This may increase price of the products. Thus, it is important for
the Fra-Pa's Frozen Yoghurt to implement as well as develop an effective strategy to invite
number of customers and at the same time also retain them for longer period of time. In context
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Illustration 1: Porter’s five forces of competitive position analysis

of Food & Beverages industry, number of fresh products are evaluated due to innovations and
customer's select luxurious products so that overall bargaining power of buyers is high.
Threat of Substitution: It is also an important factor for business organization before
serving their products in market place. As number of customers are looking for best products at
affordable cost to satisfy their needs and wants (Mathooko and Ogutu, 2015). In market various
substitute products of Fra-Pa's are available which may negatively impact on their profitability
level. In this company is responsible for making their products unique with high quality with the
aim of increasing customers base. The Food & Beverages industry face low threat of substitution
because the trends of eating or drinking might change with time.
Threat of New Entry: Overall performance of the company is based on their
competitiveness in market place. As Fra-Pa's Frozen Yoghurt is affected by it workers and and
new competitors that enter in the market. Thus, it is important for the company to make their
product best with high quality for attaining competitive advantage from its rivals. In case of
Food & Beverages industry, government authorities provides lot of subsidies for food processing
which make easy to establish relevant business so that threat of new entrant is very high.
All these are the important factors through which company can easily analyse the actual
competition at market at the time of running their business activities. With the help of this, Fra-
Pa's Frozen can easily enhance their profitability level by serving quality products and services
as per market trends and customers demand as well.
CONCLUSION
From the above mentioned report, it has been analysed that macro business environment
consider as an important aspect that directly impact upon the overall performance of the
company in positive and negative way. Thus, it is vital for business organization to effectively
implement right tool and techniques at the time of executing their activities in market. This will
contribute in enhancing profitability level at market.
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REFERENCES
Books and journals
Javeed, N. and Mukhopadhyay, D., 2017. Exosomes and their role in the micro-/macro-
environment: A comprehensive review. Journal of biomedical research. 31(5). p.386.
Van Wormer, K. and Besthorn, F., 2017. Human behavior and the social environment, macro
level: Groups, communities, and organizations. Oxford University Press.
Kormishkina, L. A. And et.al., 2015. Favorable macro environment: Formula of investment
activity growth under the economic paradigm shifted. Mediterranean Journal of Social
Sciences. 6(4). p.163.
Mathooko, F.M. and Ogutu, M., 2015. Porter’s five competitive forces framework and other
factors that influence the choice of response strategies adopted by public universities in
Kenya. International Journal of Educational Management. 29(3). pp.334-354.
Burns, P. and Dewhurst, J. eds., 2016. Small business and entrepreneurship. Macmillan
International Higher Education.
Online
Porter's Five Forces: Analyzing the Competition. 2018. [Online]. Available
through:<https://www.businessnewsdaily.com/5446-porters-five-forces.html>.
Porter’s five forces of competitive position analysis. 2018. [Online]. Available
through:<https://www.cgma.org/resources/tools/essential-tools/porters-five-
forces.html>
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