Analyzing Asda's Business Environment: Strengths and Weaknesses

The SWOT analysis presented in this report thoroughly examines Asda's business environment by exploring internal strengths such as brand recognition and product range diversity alongside weaknesses like high operational costs and limited international presence. External opportunities are highlighted, including market expansion potential and emerging consumer trends favoring sustainable products. Conversely, threats from increased competition and economic fluctuations are identified. This analysis serves to guide strategic decision-making for Asda's sustained growth and competitive advantage in the retail sector.

Business and Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
PROJECT 2......................................................................................................................................3
P4 Positive and negative impacts of macro environment of business operations........................3
M3 Apply PESTLE to Asda........................................................................................................4
P5 Internal and external analysis of Tesco Plc to identify strengths and weaknesses.................5
P6 Interrelation of strengths and weakness with external macro factors.....................................7
M4 Applying SWOT analysis......................................................................................................8
D2. Impacts of macro and micro factors upon business objectives and decision-making..........9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
An business organisation is an institution of legal entity formed by individual or a group
of people which ruin the functions with same purpose. In short,they provide the services and
products in exchange of non-monetary and monetary services. Environment of business
including internal and external affect the operation and outcome of Asda which is one of leading
retailing enterprise of United Kingdom who is subsidiary of Walmart supermarket (Adeoye and
Elegunde, 2012). The main purpose of this report is to analyse the positive and negative
influence of macro and micro environment and their interrelation with each other.
PROJECT 2
P4 Positive and negative impacts of macro environment of business operations
The influence of macro environment on several functions that organisation organise is
huge. Entire elements which impact on company's growth and development. The impact can be
negative as well as positive on the activities of Asda. This s required for the enterprise to
understand or recognise the negative impact on time to hider the obstructions before major
harms. Here are all the components which needed to be studied:
Political Factors
The increase taxation rates after the amendments n the taxation policy have emerged the
chances of fall in amount of overall revenues. This have decreased the purchasing power of the
consumer that have reduce the sales quality of the products and services of the organisation.
The cost of all drinker was required to be increased by Secretary of state for pension and
work,'an acorss board tax.' The policy of taxation have been managed to undertake the quaitoes
of conservative alcohol policy which stress over the issue's effectiveness and the level of
decreasing the cost of products. It has been noticed that the the tax raise in alcohol products is a
beginning. Strategic planner of Asda is examining the whole situation and require to investigate
the impact of this on the low prices policy of them.
Economic Factor
The company have been accused for the avoidance of tax as like their major competitors.
The government of United Kingdom have the stress of controlling and managing the affairs of
large organisation and introduce an effective approach for it (Becker, Kugeler and Rosemann,
eds., 2013). This can affect the company Asda more positivity because the company keep their

prices lower for serving and gaining more consumers. The respected company require to
understand elements including process of credit, pay level, demand and supply of labour ad
energy cost etc. This have a large impact on the strategies of costing of Asda significant.
Technological Factor
Technology is becoming ore digitalised and people are often inclined to those companies
which provide them ease and comfort in services and products. Asda have developed and
amended their older system and started using more digitised techniques such as self pay system,
Wi-Fi at stores, online suggestion and many other. The have digital system of documentation of
records of sales and other operations management. The company have evolve new methods f
shopping such as e-shopping and rendered digital products and gadgets as well as self scanning
of commodities.
Social Factors
Alternation in tendencies of society can affect the demands for new merchandise
elements such as House merchandise for the comfort and handiness of people to work and live
lives better. Population ave been ageing in United Kingdom. The organisation like Asda start
employing more older and senior people to jump into pool of labour. This refer to demands of
public more traditional and requirements of medical activities have been increased.
Environmental Factor
This consist f elements which impact one the nature and environment such as garbage,
pollution etc. Government have introduced some laws and legislation which can restraint the
growth of company (Bocken and et. al., 2014). They have banned the use of plastic bags for
contributing to the activities of state and began using more eco-friendly assets. The company
have introduced a tool online which is Sustain and Save exchange make the chain of supply more
efficient and productive.
Legal Factor
These elements are linked with the law and legislation of state of the nation in which
company operates. Companion required to implement the laws within the policies of company to
reduce the issue and conflicts with government.
M3 Apply PESTLE to Asda
Through the help of PESTLE analysis, macro environment study of Asda can be made
which have summarised as below:

Political The organisation is facing various issues and conflicts because of the instability
in political factors of the country. The organization is impacted cause of the
crisis in the nation as well as changes in policies.
Economic The business of Asda is hugely depend on the domestic activities of market as
and this is dominating the local market through rendering low cost of products
and services.
Social The consumer of UK have inclined toward the bulk shopping because f social
assortment internation. This business of the enterprise is impacted by the
changes weather it is personal or demographic.
Technological Technology have supported the organisation in gaining more customer as well
as facilitated ease in activities functioning of Asda. Company are gaining more
advantages and benefit because of the alternation which they have made of the
development (Cavusgil and et. al. 2014).
Legislative Legislation and policies which the state have produced such as increasing
taxation terms or alcohol tax rates have impacted the company business. But
few of these policies are assisting company in operation functioning and
management more effectively.
Environmenta
l
The state is keeping pressure over the more ecological activities and enacting
some new legislation and and laws for reducing the amount of pollution. Asda
is contributing to this campaign through banning use of plastic bags within
their organization and inspiring other enterprise for this.
P5 Internal and external analysis of Tesco Plc to identify strengths and weaknesses
External and internal analysis aid in understanding the elements of strengths and
weaknesses of an organisation. The purposed project have made an evaluation on the factors of
micro environment done on above. This shapes negative and positive aspects on Asda as well as
upcoming opportunities to develop and improve as well as threats which can restraint their
growth of organisation.
Here is the analysis of internal environment have don with the help of SWOT briefed as
followed:

Strength
Asda is one of most largest retailing organisation in United Kingdom which is reputed for
convenience, money and wide products and services range. The company concentrate on the
strategy of keeping prices low and saving the capital. Core competencies of companies to
utilisation of information technology tools to support the functions and operations of
organisation. Proper trainings and development availed n consumer satisfaction with the services
and increased efficiency of work (De Jonge, 2011). Also one of the major strength of company is
support of Wal-Mart which have powerful financial strength.
Weakness
The major strength of company is lack in availability of stores or supermarkets. Other
drawback of company is company is controlled by Wal-Mart despite which is suffering from
huge amount of debts. And dues. Lack of flexibility is also one of major weakness of enterprise.
Illustration 1: SWOT of Asda
Source: What is SWOT Analysis – A Simplified Definition. 2013
Opportunities
The company is harnessed by enormous purchasing power of Wal-Mart specially in
merchandise of general products. Asda can use the market penetration and market development
for spending its products and innovating them. It can deploy in global trade through various

strategies such as franchisee etc. Firm can consolidate with global supermarket companies
concentrating on the development.
Threats
Strong market competition is one of major threat to the retailing market. Price inflation in
Britain's grocery and raised petrol prices have decreased the sales of grocery and food products.
Smaller business organisation are giving fierce competition such as Aldi, Lidi etc. Independent
online services of retailing can restrain the development of the companies as well.
P6 Interrelation of strengths and weakness with external macro factors
The external factors of Asda are interlinked with the internal elements which determine
strength and weakness of a the company. Here are PESTEL analysis ND their interrelation
explained as below;
Political Factors
New legislation and laws which the state implement can affect the organisation in both
ways negatively as well as positively. The new policy or increment in the taxes have decreased
the amount of consumer for the company as it have reduced purchasing power of citizens of UK.
This have decreased the amount of revenues. This is how this elements are weakening the
position of organisation in the society.
Economical Factor
Through considering the consequence and situation of United Kingdom, it s clear that the
economical situation of country is not very well which affect the exchange of monetary among
other business organisation as well (Laumer, Eckhardt and Weitzel, 2010). The business
organisation such as Tesco, Asda and other companies are affected negatively from this fall of
economy of nation which have weakens the economy of company as well.
Social Factors
The elements f society determine the quality and types of services and products as well as
manufacture process of Asda. The organisation market the changes in the system within a period
of time, but market is dynamic which is chasing furiously. Asda is unable to make the alternation
so pace-fully so it is one of the weakness of the organisation.
But the organisation provide the products and services in lesser prices than other. People
make more purchase decision for those enterprises which provide better quality of services in

cost effective prices. Asda produce and render cheaper services in value added quality which s
one of strength of organisation.
Technological Factors
Technologies amendment is required to attract and entertain consumer as well as provide
them satisfy their demands. The company have introduced various new technologies and online
delivery of services and products which is one the strengths of company as it is helping customer
in convenience and comfort. The company is growing organisation and the4y are developing
their gadgets and technological assets which are also rendering the strength to organization,. But
it make the administration process more complex and complicated which can weakened the
management system of Asda considering it is one of the weakness.
Legal Factors
Laws and legislation are required to comply which sometime enact in favour of
organisation or sometime not. This is required for organisation to comply each rules of state that
can render support in development as well. The characteristic of following all laws can
considered as one of the strength of company and benefit the instantiation in developing and
expanding its business.
M4 Applying SWOT analysis
Strengths Weaknesses
 Effective recognition of company as
well as good reputation.
 Good quality of products along with
cost effective prices.
 It has one of the most efficiently built
infrastructure.
 Strong competition
 Decrement in profits of pre tax
 Issues in enterprise's environment
Opportunities Threats
 Technology and sales techniques such
as e-shopping etc.
 Expansion of business demographic,
geographic (Osterwalder and Pigneur,
 Emergence of rivals furiously.
 E-shopping is wide term which ca lead
to conflicts ion administration.

2010).
 Market Penetration
D2. Impacts of macro and micro factors upon business objectives and decision-making
According to Teece, 2012., the macro and micro environment have a wide role in the
decision making as well as attaining the business objectives of an enterprise. There are several
methods trough which the Asda can facilitates pace in success speed. Some of them as explained
as below:
 The elements of internal and external environment aid in judging and finalising the
objectives and goals of Asda undertaking the marketing trends and interest or demands of
consumer.
 This impact of the opinions and ideas of leader and shapes their views in matter of
innovation and invention of products development and other operations.
 Asda CEO agree with the fact that the people of company aid large contribution in the
development of organization and for motivating and stimulated them, they organise
training and development programmes for better micro environment and friendly people
of company.
This avail in the changes of decision of leader or manager according to the situation of
environment as well as assist in meeting objectives through implementing suitable strategies.
The influence he decision of authorities as well to get make the judgements according to the
situation of market and undertaking the consequence (Wirtz, Schilke and Ullrich, 2010).
CONCLUSION
This report summarise that business environment affect several elements of business as
well as determine the strengths and weakness of a company. According to this report, the micro
factors and interrelated with the macro environment of enterprise which decides major negative
and positive aspects of business and avail hugely in development and evolution of the
organisation. Firm need to maintain strengths and weakness to emerge and expand the business.

REFERENCES
Books and Journals
Adeoye, A. O. and Elegunde, A. F., 2012. Impacts of external business environment on
organisational performance in the food and beverage industry in Nigeria. British Journal
of Arts and Social Sciences. 6(2). pp.56-65.
Becker, J., Kugeler, M. and Rosemann, M. eds., 2013. Process management: a guide for the
design of business processes. Springer Science & Business Media.
Bocken, N. M. P. and et. al., 2014. A literature and practice review to develop sustainable
business model archetypes. Journal of cleaner production. 65. pp.42-56.
Cavusgil, S.T., and et. al. 2014. International business. Pearson Australia.
De Jonge, A., 2011. Transnational corporations and international law: accountability in the
global business environment. Edward Elgar Publishing.293.
Laumer, S., Eckhardt, A. and Weitzel, T., 2010. Electronic human resources management in an
e-business environment. Journal of Electronic Commerce Research. 11(4). p.240.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Teece, D.J., 2012. Dynamic capabilities: Routines versus entrepreneurial action. Journal of
Management Studies. 49(8) pp.1395-1401.
Wirtz, B.W., Schilke, O. and Ullrich, S., 2010. Strategic development of business models:
implications of the Web 2.0 for creating value on the internet. Long range planning.
43(2). pp.272-290.
Online
What is SWOT Analysis – A Simplified Definition. 2013. [Online]. Available
through:<http://pestleanalysis.com/what-is-swot-analysis/>.