Comprehensive Analysis of ALDI's Business Environment and Operations

This report provides a detailed analysis of ALDI, a leading global discount retail supermarket. It begins by examining various types of organizations, including private, public, and voluntary sectors, and their legal structures. The report then explores the size and scope of different administratio...Read More

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Various types of organisations with their purposes and legal structure................................1
P2 Explain size and scope of range of different type of administrations....................................4
P3 Relationship between organisational functions and objectives.............................................6
TASK 2............................................................................................................................................9
P4. Positive and negative impact of macro environment on business activities.........................9
P5 SWOT analysis of organisation...........................................................................................11
P6. Interrelation of strengths and weaknesses of firm with its external macro environment. . .12
CONCLUSION.............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
In the present scenario, employers of an organisation focus on developing healthy
working environment within company as by doing this, performance and efficiency of staff
members can be increased. Along with this, there are several factors included which directly
affect company as well as its employees (Fernando, 2011). Due to this, it is required to evaluate
and analyse overall causes through appropriate methods and techniques. This report is based on
ALDI which is a leading global discount retail supermarket. It is dealing with every kind of
home products and goods. Here, different types of organisations, their purposes, scope, size and
legal structure will be elaborated. In addition, relation between organisational functions and
objectives will also be defined. At last, PESTEL and SWOT analysis tools for identifying
external and internal environment of company will be discussed.
TASK 1
P1. Various types of organisations with their purposes and legal structure
Currently, there are several types of business firms which are dealing with several
products but their working system and business environment are different from each other. Due
to this, it can easy to identify their internal surrounding, management system and working style
as well (Hamilton and Webster, 2015). Thus, it is needed to analyse business environment
because with the help of this will easy to determine current position and status. Apart from this,
there are three main types of organisations like private, public and voluntary which are stated as
below:
Private sector: These companies focus on earning high profit from the external
competitive market place which can be understood private sector organisations. These
enterprises help to provide several opportunities to society so that they will enhance their
capabilities and skills as well as gain employment. With the help of private sector’s business
firms, employment in the country will be increased due to this decrease the level of
unemployment problems. In order to this, it is required to measure and determine the external
environment of company because with the help of this, employers of the firm can identify the
market situation and trends. Therefore, they will effectively take better decisions also can update
their existing working system through suitable ideas and strategies. For example: ALDI is the
fastest growing discount supermarket; it sells home products, food items, clothes and so more.
1

Employers of this firm focus on maintaining quality of their services and products so that they
can keep up loyalty and trust on their clients.
As per above represented legal structure of the ALDI, in the which vice president has all
powers and rights to regulate and control all over business firm. Vice president had enacted some
effective rules and policies within the organisation which all are have to be followed by staff
members in an systematic style (Klapper, Lewin and Delgado, 2011). Under the vice president
has five major directors of every departments such as warehousing and transportations, real
estate, operations, purchasing and administration. At the last, every directors are control and
manage employees of the company also allocate works and tasks to them as per their working
capabilities and skills so that they will perform their targets effectively.
Public sector: Generally, these type of business firms are working for the society benefits
and development because its regulate and control by government and legal authorities of the
country. Government has rights and powers to regulate and operate public sector companies as
per their rules and polices. However, public sector organisations are concentrate on to provide
better and high quality of services and facilities to public as per their needs and requirements at
the cheap cost. So that they can easy to afford and also can get proper satisfaction towards their
needs and demand. For example: NHS (National Health Service) it is an public sector of largest
health care organisation of the UK it is funded by the public.
Illustration 1: Legal structure of NHS
(Source- Rivett, 2016)
2

In the aspect of legal structure of NHS, all over business firm is controlled by the
Secretary of State it has all powers and rights to take effective and better decisions. Under this
has included Department of Health thus in which concluded NHS Commissioning Board which
is control all over regional offices of the NHS. Regional offices of NHS are situated under
approximately in the 25 local areas of the country (Osterwalder and Pigneur, 2010). Hence,
major aim and objective of NHS is to provide proper health care services and facilities to patients
as per their health issues and problems. In this addition, it has more than 212 Clinical
Commissioning Groups which gives high quality of health care services.
Voluntary sector: This kind of companies can be known as third type of business firm in
which basically included charity, non-profit organisations, NGOs and so more. These business
firms are co- related with the public and private sector companies. Therefore, its regulated and
controlled by government of the country as per their rules and regulations. For example: World
Vision is an leading international charity of the UK it was established in 1950 by the Robert
Pierce. Thus, specific aim of this charity is to provide proper facilities to every child which
necessary for them live in life. At the last, there are shows legal structure of World Vision
charity such as follows:
Illustration 2: Legal structure of World Vision
(Source- Structure of World Vision, 2017)
3

According to the represented legal structure of the World Vision, it is categorised into
three main sections congress and executive board has all powers and rights to take decisions for
the smoothly running charity. Under them has three main committees such as technical, medical
and coaching and research. At the last it has approximately 188 members of federations which
are related from the different areas such as Africa, Asia, Europe, Oceania, Pan-America (Scheer,
2012).
P2 Explain size and scope of range of different type of administrations
As per above represented three main type of organisations such public, private and
voluntary sector their legal structure and purposes also systematically has been defined in an
effective way. It assist to define internal working environment and performance of their staff
members. Along with this, there are significantly demonstrating size and scope of main three
kind of business firm such as:
Private sector: These organisations are concentrate on to earn high number of profits
also employers focus on to understand demand and expectations of their customers. So that they
will significantly give proper satisfaction to their clients thus they can set an effective brand
image in their mind towards company as well as their services. For example: ALDI is an leading
retail supermarket of the UK thus it has more than 10,000 stores in approximately 18 countries
across all over the world (Shigang, 2010). Thus, its estimated turnover is more than nearly €50
billion. ALDI has two type of organisations such as ALDI Sud and ALDI Nord thus number of
employees are almost 104,400 and almost 58,179 are working in the present time respectively.
At the last, ALDI basically it operating their business in Germany due to this it has more than
2298 Nord outlets and 1880 Sud outlets in the Germany.
Shareholders:- They assumes a fundamental part in an association. They give their
commitment in the exercises and furthermore operations of an association. The primary partners
of ALDI firm are clients, providers, investors, speculators and so on. Be that as it may, the part
of each partner is changed from each other. Without the assistance of partners, firm can not
conducts its business in a successful and furthermore appropriate way. There are a few targets of
private associations given beneath as above:
 Increment organizations.
 Do Corporate Social Responsibility (CSR) for welfare of society.
 Give great nature of items and furthermore benefits.
4

Scope:- ALDI is a one of the famous super market whose main motive is to offer
grocery items to their desired clients by covering large market share in European marketplace
(Aterido, Hallward-Driemeier and Pagés, 2011). Some of the other scope of selected company is
described as follows:-
 An individual may operate, regulate and handled overall business activities.
Illustration 3: Organisation structure of ALDI
(Source- Chylinski, 2016)
Public sector: Generally, these type of business firms are running for the society well
fair and development due to this it aids to provides large number of employment to persons.
Therefore, public sector companies are regulated and operated by government of the UK as per
their rules and regulations which all are have to be followed by public companies in an
significant way (Bryman and Bell, 2015). For example: NHS is the leading health care service
organisation of UK it provides proper health care services and facilities to patients towards their
health issues and problems. Hence, at this time more than almost 1.4 million employees are
working in the NHS additionally revenue of this firm is around £ 437 million. Along with this,
5

scope of this business firm is understand the health issues of patients then provide high quality of
health care services to their patients so that they can get satisfied with their services.
However, it has been analysed that NHS are expanded across international boundaries in
order to remove heath problems or issues from entire society as well as tries to establish a state
free from any hazardous obstacles.
Scope of Public company is highlighted below:-
 There will be need of permit and furthermore government consent in order to continue a
business entity lawfully.
 To incorporate another business, there will be necessity of maximum capital.
Shareholders:- There are a wide range of partners of this organization like government,
staff individuals, investors and so forth (Carroll and Shabana, 2010). In any case, the primary
and critical partner of NHS is government from which the exercises of this association can be
affected. Thus some of the necessary goals of NHS says underneath:
 To provide health support or medical facilities.
 Tying to become one of the leading association of public growth.
Voluntary Sector:- It is a NGO (Non-government associations). It gives the advantages
to individuals. Oxfam is a wilful association and it is a universal charitable association. The
primary concentrate of this organization is on the lightening identified with the worldwide
neediness.
Size:- It is a vast size association and this organization works with the more than around 1000
neighbourhood accomplices which perform activities on human rights.
 There are a few destinations of this organization given underneath as above:
 It principle objective is to easing of the worldwide destitution.
 Work for altruism of individuals.
P3 Relationship between organisational functions and objectives
ALDI is a very popular grocery store which is inaugurated by two brothers and putting
maximum efforts to make this organization one of the leading brand in a European marketplace
(Charter, 2017). In fact, main objective of two partners is to expand their business across
international boundaries in order to acquire maximum benefits by satisfying needs or demand of
different consumers. Thus, they are having almost 10000 stores in around 18 nations and offers
various grocery products or items in order to fulfils demand of their desired consumers.
6

Generally, ALDI is a very large association due to which they perform number of functions for
attaining their set objectives or goals. Therefore, numerous of roles or obligation are performed
by entire staff members for satisfying requirement of local as well as foreign customers. Mainly,
all the functions are interlinked with each other and success of an organization is depend upon
appropriate working of every department. Hence, various elements of ALDI are Human
Resource, promoting, financial team, operations, Research and Development and so on
(Chesbrough, 2010).
Meanwhile, selected firm play out its every one of these capacities in a powerful and
appropriate way. These all capacity works for accomplishing the shared objectives and
furthermore goals of firm. Hence after analysing all this thing it has been analysed that
development rate and market share of cited firm is much higher then its competitors due to its
unique way of working. To enhance deals, a hierarchical structure is extremely useful which
asses chiefs and furthermore staff individuals to play out their obligations and duties in a viable
or appropriate way. The principle goals of business are improving deals, benefit level, survival,
fulfils the necessities as well as needs of clients. There are some interrelationship of elements of
organization with its all capacities specifies beneath as above: Marketing:- According to this component, it has been analysed that one of the major role
which is played by this section is to promote goods or services of an enterprise at
European marketplace with the use of various tools or techniques. Along with this, major
objective of this department is to enhance the sales of a company by seeking attention of
millions of clients. Hence, various business activities which is accomplished by them are;
conduct promotional campaigning, advertisement, increase awareness by distributing
pamphlet, brochures and adopt various other alternatives for maximizing their company
sale (Commander and Svejnar, 2011). Moreover, it supports in establishing positive
goodwill of a company at marketplace. Human resource:- One of the major duty which is performed by HR team of ALDI is to
hire desired or skilled labours by considering necessary information which is required for
specific job. Mainly, their motive is to fill the vacancy of an enterprise as per need of
particular position. Their major responsibilities is to maintain the coordination between
entire staff members by accomplishing various entertaining activities in order to create a
friendly environment at workplace. Along with this , they are responsible for conducting
7

various motivational programmes in order to encourage their employees towards their
personal or professional goals or objectives. Finance :- Capital is seen as backbone for overall company because all the business
activities are implemented with the use of appropriate funds. It means, without
availability of accurate money it is not easy to perform major functions of an association.
Thus, creditors and investors act as a necessary player in success of an organization
(Craig and Campbell, 2012). Research and development:- Investigation team of ALDI plays a very eminent role in
gathering necessary information or data which is used by them while making effective
decisions. In fact, research or development team of an enterprise helps during
manufacturing process as it aids in understanding the choice or preferences of different
consumer groups. Thus, after getting aware about need of various customers, production
team can easily design suitable goods by considering it.
 Manufacturing department:- Success of an association is somehow depend upon
production team also as they are responsible for manufacturing impressive or unique
items in order to offer various types of products to their local as well as foreign clients.
Thus, after designing of qualitative goods as per consumer choice, preferences and recent
trends an organization can easily maximize their company sales.
Hence, it has been analysed that above functions plays a very eminent role in
development or growth of a company due to its efficiency. Along with this, it is also assessed
that all these above functions are interlinked with each other and their work is also depend upon
each other. However, different types of organisational structure is also highlighted as follows:- Based on function:- It is consider as a most common or similar structure because
according to this employees positions are determined as per their work or performance.
Therefore, common function of various departments that is HR, marketing, finance and
operations are separated from each other due to its different roles (Dahan and et. al.,
2010). Geographical:- According to this type, work is classified on geographic bases and
organize in various region for capturing attention of millions of clients belongs from
various domain.
8

 Product organisational structure:- In this element, composition is organized with the
help of specific goods and its type.
 Customer based:- Sometime business are totally rely on consumers and perform their
business activities according to their choice or preferences.
At last, it has been analysed that above information shows that there is greater link
between organizational functions with their objectives as well as structure due to their vital roles
or responsibilities.
TASK 2
P4. Positive and negative impact of macro environment on business activities
Macro environment is a term which shows all the external factors that are not controlling
by organization but still have a greater impact on development of an enterprise. Business
surrounding of a company are classified into two different parts that is internal or external which
have a major influence on growth of a entire corporate world because fluctuation in simgle
element affects entire entity (Drucker, 2017). Thus, it is essential for ALDI to identify the
positive or negtaive impact of macro factors on an enterprise. Hence , an appropriate assessment
of PESTLE and its affects are described below:-
Political:- Governing bodies of a nation are always coming up with various types of norms,
rules or regulation which is applicable on whole corporate world because their main motive is
to create a nation free from any discrimination or exploitation. Thus, it influence functioning of
ALDI in various ways that is highlighted as follows:- Positive:- Introduction of norms, values, rules or regulations helps buyer and seller both
in various ways such as; price of few products are fixed on their packet which is
determined by government due to which no bargaining has been taken place. As a result
it protects both the parties from loss.
 Negative:- Whereas, sometime rules of advisory bodies act like a restriction while
exchanging goods or services across international boundaries. As number of policies is
required to follow while trading with foreign customers.
Economical:- As per this element growth of company get affected in various manners.
Taxation rate, currency rate and various other things are falls under economy of a nation.
Impact of economy is given as underneath:-
9

 Positive:- Emergence of various companies at European marketplace supports in
developing economy of a nation due to removal of unemployment. Along with this, it
can also aids in raising the living standard of poor people by offering job to them as per
their ability.
 Negative:- Fluctuation in currency and taxation rate affects the business contract of
ALDI that affects their sales.
Social factors:- It includes alteration in lifestyle of society, social mobility, enhancement of
overall community due to introduction of number of impressive products. Society plays a very
crucial role in development of entire nation. Hence, effects of social components are detailed
below:- Positive:- It helps an organization in understanding the choice of various consumers
with the help of this factor and it supports enterprise while manufacturing products or
services.
 Negative:- Changes in consumer taste or preferences creates problem for ALDI
production team while designing items (Trkman, 2010).
Technological:- Emergence of advanced technology encourage managers of a selected firm
towards adopting modern equipments in order to accomplish various business activities in most
appropriate way. Impact of technology is highlighted below:- Positive:- Reduction in duration and cost by using advanced technology by completing
transactions process in more efficient way.
 Negative:- Price of technology maximized due to rapid change in modern equipments
and difficult to understand by less skilled employees.
Legal:- Legitimate bodies are responsible for enacting different laws that are followed by
company while establishing their branches in specific areas. It includes; rights of different
consumers, taxation, employment law etc. which is necessary for organization to adopt all these
things while running their business. Impact of legal factor is mentioned further:- Positive :- Unethical practices, exploitation of employees and customers as well as
various other wrongful activities get removed due to laws amended by legal bodies.
 Negative:- Sometime it create problem while running business due to number of laws as
well as it is very long process which will consume maximum time period.
10

Environment:- Resources are acquired by surrounding which is very much essential for
company to perform their business activities in more efficient way. Influence of this element is
given below:- Positive:- Essential to go through environmental conditions in order to deliver goods on
correct duration.
 Negative:- Ruined the natural resources to create various food items.
P5 SWOT analysis of organisation
Internal factors are consider as micro environment in which those factors are involved
which are fully controlled or managed by organization as per their requirement or demand. In
fact assessment of SWOT is conducted by ALDI team in order to identify the hidden points or
obstacles which affects company performance in various manner (Zott, 2011). Managerial
department of selected firm use this strategy for understanding the nature as well as try to
implement changes as per market requirement. Hence, SWOT analysis of ALDI is mentioned as
follows:-
Strength:- Highlights potentiality or capability of firm-
 ALDI is having a very strong or impressive brand name which is different from their
competitors.
 They are having maximum number of branches in almost 18 countries with around
10000 stores in various regions due to maximization in consumer demand.
 Moreover, they are also seen as a international organization at world level.
Weakness:- Identify invisible shortcomings of cited firm-
 Less skilled employees hampers the business work and its performance.
 Improper communication between employees influence success of an enterprise.
 Absence of optimum resources (What SWOT Analysis is in simple words, 2017).
Threats:
 Maximization in competition due to emergence of other alternative substitutes by
various rivalries.
 Instability in economy.
11

 Changes in currency rate.
Opportunities:-
 Online advertisement of products is one of the useful chance to promote products.
 Emergence of number of advanced technology helps in attaining set objectives or goals.
Hence, after analysing internal factors of ALDI, managerial team can easily designing
new or creative products as per consumer demands (Amit, 2011).
P6. Interrelation of strengths and weaknesses of firm with its external macro environment
Macro and micro environment have a major relation between each other because
fluctuation in any single factor influence all the other elements in various manner because all the
interlinked with each other. Potentiality and shortcoming of business entity are fully relate with
external components of surrounding due to its roles or responsibilities towards development of
an association. Thus managerial department of an enterprise compares their internal factors with
mainly macro environment elements such as; economic, political, technology, social and
cultural. After that an organization can design an appropriate strategy or operational policies as
well as affects decisional process which is taken by higher authority. Thus, interrelationship
between strength or weakness of a company with macro environment is mentioned as follows:- Economic factors:- It includes alteration in interest rate, inflation, exchange rate at
marketplace. For example ; if an organization is having sufficient fund or reserves then
changes in any currency rate doesn't affects their business. It means company is always
prepares for dealing with various business risk or challenges (Massa,2011). Political or legal:- According to this components legal rules or norms are going to
highlight which is followed by company while running their entity. Thus, availability of
specialised or expertise people helps an organization deal with legal challenges which
might be occurred due to alteration in other acts or values. Social and cultural:- In order to overcome societal challenges an organization need to
hire knowledgable or learned employees with sufficient funds as well as optimum
resources.
 Technological factors:- If selected business wanted to opt a advanced equipments then
they can easily accomplish their assigned task or business activities in a minimum
duration.
12

CONCLUSION
From the above project it has been concluded that study of business environment is
indispensable for company success or development as it helps in identifying hidden factors
which affect an enterprise in positive as well as negative manner. This assignment shows various
types of organization such as; private, public or voluntary and explains their roles or
responsibilities for development of a entire nation. Along with this, it also highlight that
assessment of SWOT and PESTLE is very much essential for a particular private company
because it helps an association during decision making process. Moreover, supports during
manufacturing of any unique products in order to gain attention of overall society.
13

REFERENCES
Books and Journals
Fernando, A.C., 2011. Business environment. Pearson Education India.
Hamilton, L. and Webster, P., 2015. The international business environment. Oxford University
Press, USA.
Klapper, L., Lewin, A. and Delgado, J.M.Q., 2011. The impact of the business environment on
the business creation process. In Entrepreneurship and Economic Development(pp. 108-
123). Palgrave Macmillan UK.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Scheer, A.W., 2012. Business process engineering: reference models for industrial enterprises.
Springer Science & Business Media.
Shigang, Y., 2010. Competitive strategy and business environment: The case of small enterprises
in China. Asian Social Science, 6(11), p.64.
Aterido, R., Hallward-Driemeier, M. and Pagés, C., 2011. Big constraints to small firms’
growth? Business environment and employment growth across firms. Economic
Development and Cultural Change. 59(3). pp.609-647.
Bryman, A. and Bell, E., 2015. Business research methods. Oxford University Press, USA.
Carroll, A.B. and Shabana, K.M., 2010. The business case for corporate social responsibility: A
review of concepts, research and practice. International journal of management
reviews.12(1). pp.85-105.
Charter, M. ed., 2017. Greener marketing: A responsible approach to business. Routledge.
Chesbrough, H., 2010. Business model innovation: opportunities and barriers. Long range
planning. 43(2). pp.354-363.
Commander, S. and Svejnar, J., 2011. Business environment, exports, ownership, and firm
performance. The Review of Economics and Statistics. 93(1). pp.309-337.
Craig, T. and Campbell, D., 2012. Organisations and the business environment. Routledge.
Dahan, N.M. And et. al., 2010. Corporate-NGO collaboration: Co-creating new business models
for developing markets. Long range planning. 43(2). pp.326-342.
Drucker, P.F., 2017. The Theory of the Business (Harvard Business Review Classics). Harvard
Business Press.
Trkman, P., 2010. The critical success factors of business process management. International
journal of information management. 30(2). pp.125-134.
Zott, C., Amit, R. and Massa, L., 2011. The business model: recent developments and future
research. Journal of management. 37(4). pp.1019-1042.
Online
What SWOT Analysis is in simple words. 2017. [Online]. Available through:
<http://pestleanalysis.com/swot-analysis-examples/>.
14