UK Consumer Confidence Improves Despite Rising Inflation: Impact on Aviation and Online Food Delivery Sectors

This article discusses the impact of rising inflation on UK consumer confidence and its effect on the aviation and online food delivery sectors. It also provides guidance on starting a new business venture and the importance of legal structure and market structure.

Global Business environment

Table of Contents
Coursework 2a-Newspaper article..............................................................................................1
Coursework 2b- E-mail...............................................................................................................4
References:.......................................................................................................................................2

Coursework 2a-Newspaper article
According to the Dench. A, (2019). UK's consumer confidence is improving instead of
the increasing inflation due to the alleviating worry about the recovery in spending by the some
famous economists. Businesses are showing positive signs due to the initiate of the consumers
spending. Despite of the fact that there is surge in the inflation rate of the UK economy but it has
not been impacting the consumers enthusiasm towards the celebration of their black Friday and
Christmas (Acuña, Echeverría and Pinto-Gutiérrez, 2020). GFK's consumer index is rising in
the upwards direction with the recovery points of 3 from -17 to -14. Thus, the demand for the
products is raised suddenly and steeply which is favourable for the suppliers in the performing
markets. Moreover, the FTSE is also demonstrating the upward movement in its statistics
showing the healthy and profitable situation for the performing industries. UK industrial segment
such as clothing, FMCG, retailing, hospitality and wholesaling industries are growing and
participating actively in increasing the GDP level of the UK.
The aviation industry of the varied business sectors has been struggling roughly due to
the global pandemic situation. The government in UK has announced the complete lock down
and extreme restriction on the aviation industry after the re-opening of the lock down. This
industry of UK has faced heavy loss in terms of revenue, labour, consumer and much more due
to the presentation taken by the government in order to stop the spread of the Pandemic. For
instance the easy jet, termed as the low fleet airlines has first time faced the heavy loss in its
sales and revenue after the decades. Also after the post lock down the the industry was still
struggling with the loss of pilots, employees turnover and high safety measures increased the
additional cost on the business (Defossez, 2021). Due to restriction on international flights the
industry was not gaining any foreign exchange revenue that could increase economy of the
country. The below are the statistics for the demonstration of recession in the aviation industry.
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The online food delivery sector of the businesses has great increase of revenue in past
few years and is projected as the trending and profitable sector in future. Consumers with the
short run time are highly relying on the services of this business sector. The services of the
online food delivery platform are seemed as the fast, safe and high quality delivery. Moreover, in
the current time the high number of food outlets and restaurants has collaborated with online
delivery company and also transformed their business into take way orders business. The
growing food outlets demand has been reported which has highly positive impact on the
respective industry (Keeble and et. al., 2020). This the major reason that the compounding
growth is expected for the future operations in this industry. Therefore this industry will prosper
over the next 12 months in great amount. The below statistics demonstrate the growth of online
food delivery platforms.
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Illustration
1: These 4 charts show the crisis faced by airlines – and the possible way ahead,2021
(Source: These 4 charts show the crisis faced by airlines – and the possible way ahead,2021)

On the basis of the CAGR on investment for long term the food sector organisation that is at
prosper stage is highlighted below:
Deliveroo plc has the 241.5 GBX
Overview 2018 2019 2020
Gross margin 15.85 20.64 26.97
Return on assets - -83.94 -43.39
Asset turnover - 2.04 2.28
Debt to asset ratio - 0.55 0.06
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Illustration 2: Online Food Delivery Services Market Size, Share & Trends Analysis Report
By Type, By Channel Type (Websites/Desktop, Mobile Applications), By Payment Method,
By Region, And Segment Forecasts, 2019 - 2025, 2022
(Source: Online Food Delivery Services Market Size, Share & Trends Analysis Report By
Type, By Channel Type (Websites/Desktop, Mobile Applications), By Payment Method, By
Region, And Segment Forecasts, 2019 - 2025, 2022)

Since the food sector that has online food service platform is boosting rapidly. The customers of
this segment are spending chunk on income on the foods and restaurants (Chbib and Page, 2020).
Therefore it is recommended to the investor to invest into the emerging food sector as the
industry has high rate of return on investment and also the above analysis is showing the good
signs to grab the opportunity to invest in online food delivery services.
Coursework 2b- E-mail
From: XYZ
To : ABC
Subject: guidance to start a new business venture.
Dear friend,
It is great initiative to start a new business and become own boss of oneself after the
situation of the pandemic. As per secondary analysis it is analysed that business start-ups that are
using digitally advanced technology tools is growing rapidly and also has great scope to have
potential customers and generate the competition and revenue both (Elmghaamez and Akintoye,
2021). The idea of importing of the cheap mobile phone devices from the China and Taiwan is
good idea but has major issue of legal acceptance and also their will be higher dependency on
suppliers.
The legal structure is the essential need for the for the business success as this will decide
the future risk, management, and profit distribution of the company. The two types of legal
structure sole proprietorship and partnership. The advantage of choosing sole proprietorship
there is complete power and right on decision making, profits, loss and much more. This means
one gets to act as boss. The disadvantage of this at the current time of pandemic is that the
person needs high investment for his business which is not possible as this legal structure. Also
the big losses in business can lead to risk on personal belongings and assets.
The partnership legal structure defines the ownership of two more people on the business. This
has its own benefits such as guidance and suggestion in complex decision making related to
business growth (Fan and et. al., 2020). The disadvantage of this legal structure is that profits are
required to be shared as per the written contract. Also if the business fails the lack of detailed
agreement can cause legal issues.
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From the above comparison it has been observed that partnership legal structure will be best to
start a business as helps in enhancing expertise and knowledge of individuals. Partners share
roles and responsibilities which assist them in reducing their stress. This legal structure also
helps in bringing more investment as both partners will seek for new investees. After COVID-19
it has become difficult in starting a new business solely. This legal structure also provide
opportunities to individuals for sharing liabilities which makes them easy to operate business
operations. It also assist in maintaining work life balance along with providing a morale support
to each other. This legal structure is beneficial as it helps both partners in finding new
perspectives which brings innovative ideas to expand business (Fan and et. al., 2020). It also
helps in taking better decision which could enhance growth and productivity of company. In
partnership business each partners own equal responsibilities that makes them more efficient and
productive along with providing them opportunities to learn new skills or talent for improving
their personality.
Market structure
The two market structure that are Perfect Competition and Monopoly. Perfect competition refers
to the market situation where there are several companies who are trading in homogeneous
commodities (Keeble and et. al., 2020). Whereas monopoly defines as the market structure
where a single firm is responsible for selling products that are unavailable in the market. In
perfect competition, the price is equal to marginal cost at the equilibrium output whereas in
monopoly price is higher than the average cost at equilibrium output. In the perfect competition
there are no restriction on new entrants to enter in the market but in monopoly there exist a
strong restriction on new companies.
It is concluded that for the business to prosper in the COVID-19 pandemic the businesses must
use the partnership legal structure as the partnership brings innovation in the firm through
different idea generation. The HMRC duty charges are the major implication for business to
consider while working at international level at will influence the product prices due to addition
of VAT (Bruijl, 2018).

References:
Books and Journals
Acuña, G., Echeverría, C. and Pinto-Gutiérrez, C., 2020. Consumer confidence and
consumption: Empirical evidence from Chile. International Review of Applied
Economics, 34(1), pp.75-93.
Bruijl, G.H.T., 2018. The relevance of Porter's five forces in today's innovative and changing
business environment. Available at SSRN 3192207.
Chbib, I. and Page, M., 2020. Board composition and firm performance: The case of FTSE all
shares. IUP Journal of Corporate Governance, 19(1), pp.7-27.
Defossez, D., 2021. The employment status of food delivery riders in Europe and the UK: Self-
employed or worker?. Maastricht Journal of European and Comparative Law,
p.1023263X211051833.
Elmghaamez, I.K. and Akintoye, E., 2021. Internal corporate governance mechanisms and
financial performance: evidence from the UK's top FTSE 100 listed
companies. International Journal of Business Governance and Ethics, 15(2), pp.190-
214.
Fan, G.F and et. al., 2020. Forecasting electricity consumption using a novel hybrid
model. Sustainable Cities and Society, 61, p.102320.
Keeble, M and et. al., 2020. Use of online food delivery services to order food prepared away-
from-home and associated sociodemographic characteristics: a cross-sectional, multi-
country analysis. International journal of environmental research and public
health, 17(14), p.5190.
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