Business Environment of ALDI: Functions, Analysis, and Strategies

This report provides a comprehensive analysis of ALDI's business environment. It begins with an introduction to the concept of the business environment and its components, both internal and external, with a focus on ALDI as a case study. The report then examines the relationship between various functions within an enterprise, such as human resources, finance, marketing, and production, and how these functions contribute to achieving organizational objectives. The report also explores the impact of the macro environment on ALDI, utilizing PESTEL analysis to assess the political, economic, social, technological, environmental, and legal factors affecting the business. Furthermore, the report delves into internal and external analysis, employing SWOT analysis to identify ALDI's strengths, weaknesses, opportunities, and threats. Finally, the report discusses the interrelation of strengths and weaknesses with external macro factors to design systems and function effectively, concluding with a summary of key findings and recommendations.

BUSINESS
ENVIORNMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
COVERED IN PPT.....................................................................................................................1
TASK 2............................................................................................................................................1
P3 Relationship between various functions of an enterprise in respect to objectives and
structure.......................................................................................................................................1
TASK 3............................................................................................................................................3
P4. Positive and negative impact of macro environment upon business organisation................3
TASK 4............................................................................................................................................6
P5 Studying on Internal and External Analysis...........................................................................6
P6 Interrelation of Strength and weakness with external Macro factors.....................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment is concept which comprises different organisation and factors which
impacts operations. Government, environment, technology, economic and people are external
factors. These are components which indirectly influence on business activities. Suppliers,
employees, shareholders, competitor and customers are internal components which directly
affect firm (Business environment. 2018). Present report is based on ALDI which is popular
company established in United Kingdom. Personal care, food, refreshment and various products
which firm deliver in market to provide things to people in respect to their taste and preference.
This assignment illustrates different structure and purpose of organisation which vary with each
other in respect to size, scope, structure and objectives (Chetwood and et. Al, 2014).
Relationship between functions of enterprise and link of departments to accomplish objective
and goals. Macro environment positive and negative impacts are ascertained by management
with help of Internal and external analysis tools that are PESTEL and SWOT. Thus, interrelation
of strengths and weaknesses with external macro factors to design system and function
effectively.
TASK 1
COVERED IN PPT
TASK 2
P3 Relationship between various functions of an enterprise in respect to objectives and structure
Executive makes system function and implement appropriate tools and techniques to
accomplish goals and targets within defined time. It is essential for management to frame
departments and distribute members in according to their skills and abilities. Human resource,
finance, production, marketing, sales, IT and research and development are various units which
ALDI has to provide appropriate items and services to customers. It is necessary that
departments function in coordination and managed by superiors to achieve objectives as defined
by seniors (Crane and Matten, 2016).
Human resource department: Employer responsibility is to conduct recruitment, selection,
compensation, training and development practices to have adequate manpower in organisation. It
is essential that each department has appropriate workforce which help executive to conduct
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business activities effectively and deliver adequate things in market in according to needs and
requirement of people. ALDI which has outlet in different nations and large customer base which
is due to adequate manpower present with firm.
Finance department: This unit performs activities of maintain records about expenses and
income generated by executive. Balance sheet, profit and loss statement are formulated by
management of ALDI to have proper acknowledge about distribution of capital in different
activities. Every department require proper and adequate amount of money to execute operations
effectively.
Research and development department: Market research and survey are technique used by
management to acknowledge needs and wants of people. These tools also help seniors to
anticipate competitor’s offerings. ALDI has variety of items which has good image and
reputation in market. R&D team helps in giving direction to operation members to produce
things in respect to taste and preference of people. This also helps marketing team to design
system and make it function in proficient manner (Gharajedaghi, 2011).
Production department: This unit responsibility is to manufacture items and provide things
in according to needs and wants of people. It is essential that appropriate tools and techniques are
implemented in system which helps management deliver quality items and quick services to
customers. ALDI which has large variety of food items, healthcare and other things require to
deliver quality goods to clients to sustain its market image and reputation.
Marketing department: This is important segment which enhance goodwill and position in
market. Marking plan is formulated by management of ALDI which defines information about
marketing mix that is product, price, place, promotion, people, process and physical evidence.
Sales promotion, online advertising, social media and publicity are various techniques used by
company to inform people and persuade them to purchase things. This help salespeople to easily
grab attention of customers and save their efforts and time.
Sales department: This unit includes people which are given duties to deliver items and
services to people in respect to their needs and wants. Customer interaction and feedback are
activities conducted by salespeople of ALDI to influence customers and acknowledge their
opinions and thoughts in respect to quality of items. This helps management to make
modifications in system and technologies so that creative and innovative things are delivered in
market (Gilboy, 2016).
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Information Technology department: Every organisation require to have appropriate tools
and technologies implemented in system to utilise resource and deliver appropriate items and
services in market. ALDI is popular firm, so it is necessary that latest techniques are used by
seniors to deliver quality products. Along this, administration requires delivering variety of items
for which production team require adequate equipment and tools in system. This helps
management to establish competitive advantage and improve market reputation than other firms.
Organisation structure: Flat, matrix, functional, divisional and project are various forms of
structure which are choose by administration to design system and make it function in according
to market conditions. Size, scope and objective determine type of structure adopted by
management to delegate and distribute employees in departments to accomplish goals and
objectives (Kian Chong, Shafaghi and Leing Tan, 2011).
Divisional organisation structure is followed by ALDI which help executive to manage
and coordinate business. There are large numbers of branches which are situated in different
nations to provide items and services in according to needs and wants of people. This helps
management to organise activities and operations to enhance market image and position in
respect to competitors.
TASK 3
P4. Positive and negative impact of macro environment upon business organisation
Political, economic, social, technological, environmental and legal are various factors which
are present in external of organisation. These are components which indirectly impacts on
business activities as they never remain static and change with time continuously. Management
require making examination and checking market conditions to make system function
accordingly. PESTEL analysis is technique used by ALDI to have complete knowledge about
macro factors and its influence on business. This helps management to acknowledge positive and
negative impacts of macro environment on activities which is described below (Kaufmann,
Kraay and Mastruzzi, 2011).
PESTEL analysis of ALDI:
Political Factors: Government of UK had formulated rules and regulations to control and
manage business activities. It is essential for management to frame strategies and policies in
respect to authorities which help ALDI to position legal reputation in market.
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Positive impacts: ALDI has strong brand name which is constructed as administration follow
legal norms and makes system function in according to legislation.
Negative impacts: Executive faces problems and difficulties to make changes in tactics with time
in respect to transformation in laws by government. Along this, they even require to frame
policies in according to country in which business is setup.
Economic Factors: Interest rate, inflation and exchange rate are various components which are
determined by government in respect to state of economy to regulate and manage cash flow
in nation. (Türetken and et. al., 2011)
Positive impacts: In UK, there is inflation which define that public have adequate funds to
purchase things in according to fulfil and accomplish their needs and wants. This help ALDI
to have large customer base which benefit management to enhance sales and profitability.
Negative impacts: Exchange rate and interest rate keeps on fluctuating which impacts on funds
available with firm. ALDI has outlets in number of nations which define that changes in
exchange rate effect on business.
Social Factors: This component define that organisation conduct business activities to deliver
items and services in market in according to fulfil needs and wants of people. ALDI has
variety of items in outlet to fulfil requirements of customers by giving them quality things.
Positive impacts: ALDI has large variety of items which help management to attract large
number of people and enhance sales and revenue (Vaiman, Sigurjonsson and Davidsson,
2011). Customers prefer and visit outlet only if they get different varieties and products
which are in respect to their taste and preference.
Negative impacts: Administration require to have skilled and competent people which deliver
quality products and services to people. It is essential that changes in things are made that is
creative and innovative things are delivered to clients to provide items in according to
market trends. But this, consumes time, huge money and efforts of top personnel.
Technology Factors: This factor define that management require to implement appropriate tools
and techniques in system to utilise resources and deliver things in according to demands of
people. ALDI is retail store which require to have adequate items that are present in outlet in
respect to needs and wants of customers.
Positive impacts: ALDI require to use latest technologies to enhance customer experience and
give them quality things. Customer service which is main and important tactic will be
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accomplished only if adequate tools and techniques are used by members. Social media and
phone apps require proper system being used by members. (Wack, 2017)
Negative impacts: Market is dynamic and there is fast developments in technologies which
require that management need to make changes in system and implement modern
technologies. This consumes large funds and time of superiors to train staff and make them
competent in respect to machines and equipment’s.
Environmental: Organisation require to use natural resources efficiently. It is essential that
climate and environment is paid attention while using things. ALDI require to deliver items
and take care of petrol which is non-renewable thing. This helps firm to improve market
conditions and take care of environment of United Kingdom.
Positive impacts: In ALDI, latest tools and techniques are used by management that is internet
helps in saving paper uses and deliver quality things and services to people.
Negative impacts: ALDI will lose market image and goodwill if management don’t give healthy
things and utilise resources efficiently than rival firms. (Yu and Ramanathan, 2013)
Legal: Equality, discrimination and minimum wages and hours are act which are formulated by
government to protect and safeguard rights of staff members. Management require to give
fair and proper treatment to members to retain them and make them perform tasks
effectively. Quality of items and quick services depend upon willingness of employees
which depend upon working environment, duties and compensation given by seniors.
Positive impacts: In ALDI, administration has adequate workforce which help them to conduct
business and organise branches in different nations easily. Customers get variety of things
and treatment from staff. This help company to position higher than competitors by having
skilled and competent members.
Negative impacts: ALDI has global business so there are different background people employed
which require proper working of management to manage staff and give them proper training
and conditions (Tayur, Ganeshan and Magazine, 2012).
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TASK 4
P5 Studying on Internal and External Analysis
Executive of each and every organisation require to have complete knowledge about system
abilities and market conditions. This help management design system and implement appropriate
tools and techniques to deliver adequate items and services in market in according to needs and
demands of people. SWOT analysis is technique used by seniors of ALDI to acknowledge
strengths and weaknesses of system. This tactic also helps superior to anticipate opportunities
and threats. Hence, management is able to enhance market image and reputation by providing
quality and variety of things to customers (Li and et. al., 2011).
SWOT analysis of ALDI: This is description of strengths, weaknesses, opportunities and threats
of company.
Strengths Weaknesses
 ALDI has strong brand name and
market reputation which help
management to grab attention of
people.
 Top quality products and at cheap
prices are available in supermarket
which helps firm to have adequate
customer base to enhance sales.
 ALDI has branches globally which
helps firm to have good market reach
and number of consumers.
 This helps executive to establish
competitive advantage and position
firm superior than rival firms.
 Customers are given quality items and
services which make their experience
wonderful. This help ALDI to satisfy
clients and make them loyal towards
firm (López-Gamero, Molina-Azorín
 ALDI has limited variety of items in
portfolio which impacts on sales and
profitability of firm.
 ALDI is small in relate with other
supermarkets.
 Company offer products at affordable
rates which affect on quality of items
and influence on satisfaction of
customers.
 Customers prefer to visit store which
has large varieties and things. This
influence on quality of perception of
people in respect to company.
 Training and development programmes
that is sessions, seminars, conferences
and meeting conducted by seniors to
improve skills and abilities of members.
This make staff skilled and competent
to perform tasks effectively. But
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and Claver-Cortés, 2011).
 Modern technologies are used which
help management to maintain relations
with suppliers and distribution of things
effectively.
consumes large efforts and time of
management and funds.
Opportunities Threats
 ALDI has large number of
opportunities which include expanding
business and opening branches in
different nations.
 Management of ALDI require to invest
money in advertising to compete with
rival brands.
 Enlarge business in growing economies
such as Asia, Africa and many other
nations.
 Company require to use latest tools and
technologies to deliver quality items
and services to customers. Along this,
executive even require to provide
creative and unique things to people in
respect to market trends.
 Construct effective relationship with
customers by using social media and
other techniques that is e-mail and
phone apps.
 ASDA, Morrisons, LIDL are various
competitors of ALDI.
 ALDI is not able to provide quality
products which affect on shopping
experience of customers.
 Private label brands of ALDI is easily
tossed by other brands.
 Management has various problems and
difficulties faced in respect to online
shopping tactics.
 Along this, changes in petrol prices
impacts on business activities.
Influence on decision-making activities of ALDI: Management of ALDI require to utilise
market opportunities by using strengths of system. Along this, they even need to overcome
weaknesses and position firm superior than rival firms. It is necessary that ALDI increase their
focus towards quality of products which is main requirements of people. Along this, superior
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even require to use different promotional tools to establish competitive advantage over other
brands in supermarket. Company even have scope to increase their business in other market
segment to increase variety of products and customers to enhance sales and profitability.
Therefore, SWOT analysis helps management to have complete knowledge about
capabilities of system which help in designing and making modifications in according to market
conditions. Government rules and regulations are considered by administration of ALDI to frame
policies and strategies to make system function legally and in respect to authorities of United
Kingdom. This helps superiors to deliver things and services in according to market trends.
Management responsibility is to utilise market opportunities and position firm superior than
competitors. This help them to enhance sales and profitability which help in constructing good
image and reputation in market.
P6 Interrelation of Strength and weakness with external Macro factors
ALDI is popular and famous business firm which provide different variety of items that is
food, healthcare and many other things to fulfil needs and wants of people. There are various
products which has gaining brand identity in market due to its superior quality. This helps
management to make success and prosper with time by making system function effectively.
ALDI has strong brand name which helps management to grab customers easily. But to retain
clients and satisfy their needs and wants, it is essential for firm to deliver quality items and
services to them (Zeng, Li and Duan, 2012).
PEST analysis is appropriate technique used by management of ALDI to assess their
strengths and weakness on functioning of system is described beneath:
Political: This factor defines rules and laws which are formulated by government to
regulate working of organisation. It is necessary that management consider these regulations
while framing strategies and policies for ALDI. Thus, these are benefits and demerit that political
factor have are: Strengths: ALDI is able to transfer products to different nations, with help EU which
promote export of goods and have liberalised taxation policies. This helps company to
increase market reach and customer base to enhance sales and profitability.
 Weakness: ALDI has branches globally which defines that executive require to frame
policies in respect to regulatory bodies. Along this, management even need to take care
that customers are not harmed by their practices.
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Economic: This factor comprises different components that is interest rate, exchange
rate, inflation, growth which influence on decisions and availability of funds. Strengths: In UK there is high level of growth and increase in employment which helps
ALDI to have benefits on sales. Country have adequate customers which purchases
branded products to fulfil their needs and wants.
 Weakness: Government keeps on changing taxation policies and interest rate in respect
to conditions of country which affect on functioning of ALDI and its sales.
Social: This factor defines that companies require to different cultural aspects and
consumer preferences and requirements. It is essential that management provide products and
services in according to demands and needs of people. Strengths: ALDI have branches in different countries which help executive to have good
customer base to enhance their sales volume and generate good amount of revenue from
business. Along this, different range of food items and variety of products are available in
supermarket which help management to attract large number of people and enhance sales.
 Weakness: ASDA, Morrisons and LIDL are rival firms of ALDI which affect on sales
and profitability of company. Besides this, management even require to provide quality
products which are differentiated from competitors.
Technological: This factor specifies that research and development activity is to
implement appropriate tools and equipments in system to deliver adequate items and services in
market. Strengths: In ALDI, management have implemented latest technologies to deliver
cheaper products in market. This help firm to attract large number of people which are
price cautions. For this, electronic payment system provide quick services to customers
and get convenient experience in their shopping.
 Weakness: Customers demands and choices keeps on changing with time. This define
that ALDI require to provide creative and innovative products to people. Along this,
management even require to increase their business into e-commerce to increase their
market reach and customers.
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CONCLUSION
From the above report, it can be comprehended that business environment has various
organisation which differ in respect to size, scope, objective and structure. Private, public and
voluntary are various forms of business firms which are present in market. These are different
organisation which are organised and managed by individuals or authorities to deliver adequate
items and services in respect to demands of people; thereby enhance economy by increasing
employment opportunities. Micro, small, medium and large scale are various forms of
organisation present in market. PESTEL analysis is technique used by management to have
accurate and complete information about macro external factors and its impact on business.
Along this, SWOT analysis is conducted by administration to anticipate internal capabilities by
acknowledging strengths and weaknesses of system. This help seniors to utilise market
opportunities and protect firm form threats. Thus, executive have knowledge about internal and
external abilities by interrelating macro external components with strengths and weaknesses.
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