Business Environment Analysis Report: Strategic Analysis of UK Firms

This report provides an in-depth analysis of the business environment, focusing on the interplay of internal and external factors that influence organizational decision-making. It begins by defining the business environment and its impact on organizational growth. The report then explores different types of organizations, including public (Bank of England), private (Sainsbury's), and voluntary (Oxfam), examining their purposes, sizes, scopes, and legal structures. It also analyzes the relationships between various organizational functions, such as marketing and human resources, as well as marketing and finance. The report further utilizes PESTLE and SWOT analyses to assess the macro and micro factors affecting Sainsbury's and the Bank of England. Finally, it examines how strengths and weaknesses interrelate with external factors to provide a comprehensive understanding of the business environment and strategic considerations for these organizations.

Business and the
Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purpose of organisation .........................................................................1
P2 Size and scope of various kinds of organisation ...................................................................2
TASK 2............................................................................................................................................4
P3 Relationship between different organisation functions .........................................................4
TASK 3............................................................................................................................................5
P4 PESTLE analysis ..................................................................................................................5
P5 SWOT analysis .....................................................................................................................6
TASK 4............................................................................................................................................7
P6 Strength and weakness interrelate with external factors ......................................................7
CONCLUSION ...............................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
The term business environment is combination of internal and external factors which
directly impact over organisation decision making process. As per the market trends varies, the
business environment of an organisation also differ (Aithal, 2017). Therefore, understanding the
aspect of business environment is regarded as an important contribution for any form of
organisation in order to attain sustainable growth and development in an effective way. In this
report, it emphasize over the different form of organisation and its purpose, size, scope,
implication of relevant theories to examine the impact of micro and macro factors over company,
interrelationship between various business function within an organisation for accomplishing the
goal in a better way.
TASK 1
P1 Different types and purpose of organisation
The accumulation of both macro and micro factors is termed as business environment
that keeps on changes as per industrial competition. Thus, it impact positively and negatively
over organisation overall performance and growth. IN this aspect, three types of organisation has
been considered i.e. Mars and Spencer as a private, Bank of England as a public and Oxfam as a
voluntary. Each of these companies and multinational companies and operates its services at
global level.
Public Organisation: This kind of organisation is link with those form of business
whose functions and operations are operated or monitored by government. IN context of this,
Bank of England has been regraded which is a known and established as a central bank within
UK and it is founded in the year of 1694. Moreover, Bank of England is also authorised to issue
notes for other commercial bank in UK and also provides proper direction or guidance to various
financial institution to achieve their goal in an amended manner. Some of the examples are BBC,
NHS and many more (Avramenko, 2012).
Private Organisation: This form of establishment is refer to any association, person,
corporation who are publicly operated and governed rather they are established to earn
maximum level of profit margin in a stipulated time duration. IN this relation, Mark and Spencer
has been included as it is well known as famous and reputed firm within UK retailing industry. It
is commenced in the year of 1884 and offer wide range of products such as food and clothing as

well as covers the worldwide. Some of the example of private organisations are Sainsbury,
ASDA, Waitrose
Voluntary organisation: Under this, it is refer to those group of association in which
some personnel enter into an agreement as volunteers with an aim of improving the living
standard of community and society in an improved manner. IN regard of this, Oxfam
organisation ahas been viewed which is a an independent charitable company who mainly
focuses over removing the issue of poverty and injustice from community. IT is founded in the
year of 1942 and also organises different campaigning programs in order to enhance the living
standard of individual in an impressive way. Some of the examples are WHS, Save the Children,
WellCome Trust and etc (Berg and Kilambi, 2014).
P2 Size and scope of various kinds of organisation
The above mentioned companies are different from each other as each of them has
unique set of goals, size, scope, legal structure. The explanation of these criteria are discussed
below:
Public Organisation
Services and Products- Bank of England render the financial services to different
commercial banks within UK market. Some of its services are fixed term deposit, foreign
currency payments, gold custody services and many more.
Size- The size of Bank of England is large in nature as it contain 1001-5000 employees
who are highly skilled and potential to carry out the business managerial and operational
function in an effective mode.
Scope- Bank of England operates its functional unit across the globe and also deals into
differ types of services like issuing banknotes, regulating and supervising financial firms that
makes its scope large.
Vision and mission- The core vision of Bank of England is to improve and enrich the
effectiveness of banks in UK industry and also keep them monetary stable in order to acquire
competitive position in competing marketplace (Chi, 2015).
Objectives- The primary objective of Bank of England is to promote the living standard
of people by maintaining the monetary and financial stability and obtain best choice from clients.
Legal structure- The legal structure of public organisations are explained below:

Central Government: Such type of establishment are governed and monitored through
central government.
State Government: In this, establishment are monitored and controlled with the help of
state government.
Local Authorities: This kind of organisation are managed and processed through the local
government.
Stakeholders- These are the manpower which take an interest in activities and operations
of organisation. The stakeholders of Bank of England are customers, employees, government
authorities, public firms (Craig and Campbell, 2012).
Private Organisation
Sainsbury is one of the multinational and well established retail company in UK market
which mainly specialises in selling the food items, quality clothing and home products. It is
founded in the year of 1869.
Products and services- Sainsbury deliver variety of products and deals into
hypermarkets, superstore, convenience shop, supermarket all over the world.
Size- The Sainsbury has a size of 1,86,900 manpower who are able to put novel ideas or
thoughts for the gaining competitive advantage among competitors.
Scope- Sainsbury has wide range of scope as it serve its products or services at global
pace as well as it has improved level of customer base and also it is famous for maintaining the
quality in its product.
Vision and mission- Vision is “To become the first and best choice for customer and
expand the business activities at international level.” The mission of Sainsbury is to give the high
quality service to targeted customers and also to provide best financial return to stakeholders.
Objectives- Its main objective is to attain sustainable profit margin and productivity ratio
in competing industry and also to obtain increased of level of satisfaction from consumers. The
purpose of Sainsbury is to meet out the requirements of consumers taste and preferences and
maintain a positive brand image among competitors (Hillary, 2017).
Legal structure- Private company legal structure given below:
Sole- trader- In this, the whole functional unit is controlled and monitored by a single
person and there is requirements of small amount of money to set up the business. Furthermore,
sole trader has unlimited liability.

Partnership- Under this, it is an agreement and combination of two and twenty
individuals who come together with an intent of sharing the profit and loss in a equal proportion.
Public limited Company- It is small in size and owned by shareholders as well as they are
obliged to sell the shares in general public .
Stakeholders- The stakeholders of Sainsbury are management, staff, shareholders and
owners (Ifinedo, Pyke and Anwar, 2018).
Voluntary Organisation
Services and Products- Oxfam offer the services like fair trade, basic amenities for
livelihoods, gender equality, justice, survival needs in natural disasters.
Size- Oxfam is a group of the 14 forms who operate its functions in more than 3000
parters in around 100 countries in order to acquire better search solutions related to poverty and
injustice.
Scope- The activities which Oxfam conducted is fully emphasised on minimizing
poverty and also save people life from disaster.
Vision and mission- Vision of Oxfam is to eradicate the poverty and injustice from
society.
Objectives- The objective of Oxfam company is to assess the people directly when the
local capacity is inappropriate. It works on providing the better life to people.
Stakeholders- The stakeholders of this company are Trade Union, Trustees and donors,
Volunteers.
TASK 2
P3 Relationship between different organisation functions
Each functional unit are interrelated with each but they perform various kinds of
activities which are mentioned below:
Marketing and Human Resource department: In this marketing help human resource
section by advertising regarding job vacancy through various mode of communications like
advertisement in newspaper, online platforms, campus recruitment, job fare. With the help of
marketing division, human resource departments can easily fill up the vacant job position in an
impressive or productive style (Janita and Miranda, 2013).

Marketing and Finance: In this, finance section analysis each market trend and based
on that provide sufficient amount of fund to marketing departments. Due to such action,
Sainsbury's marketing section can promote the products or services by adopting different
promotional strategies like public relation, social media marketing and many more (Tynan,
McKechnie and Hartley, 2014).
TASK 3
P4 PESTLE analysis
For examining the external macro factors, PESTLE analysis is a effective approach
which enable an organisation to identify its external environment i.e. competitors, customer
demand, government regulation and many more. Along with this, it also lead them to implement
best strategic decision that lead an establishment to acquire improved level of productivity and
profitability ratio. Hence, the PESTLE analysis of Sainsbury and Bank of England are discussed
below:
Sainsbury
In UK, the business of Sainsbury's affected by Brexit because due to it the situation of inflation
was generate in the market and business environment so the prices of product are maximised.
The respected company operate its business globally so the taxation cost is also increased which
affect the company (Palepu and Healy, 2013). Increment in fuel prices is one of the biggest
economical factor which highly affect Sainsbury's. Social factors which influence the business of
respective firms are that the organisation offer healthier foods to its customers and also involved
in charities and raise funds for several different cause like arrange social activities etc. This
positively affect the business of the company. Technical factor also help in running the business
of the firm such as the respective firm also offer online shopping option to its target audiences
which help in maximising the customer base of the firm. Carbon footprint is an environmental
factor in which organisation like Sainsbury make their large contribution by minimising the use
and wastage of plastic. The management of respective company properly follow all the legal
activities like labour law, consumer protection law, equality Act etc. of the government and by
considering them operating its business which favourably affect the company.
PESTEL analysis of Bank of England

The business of respective firm is affected by political factor when the the changes are
generated in political environment like the organisation influenced by new regulatory capital
rules. The economical factor affect the company when the changes are occurred in currency rate
and the value of pound sterling against the major currencies like dollar and Euro. This negatively
affect the firm. The managemnt of Bank of England make changes in ageing population for
future product and services offers which provide business opportunities to it as pension age
consumers have more incomes and earn higher disposable incomes. The firm also make technical
innovation by offering application to its potential clients which positively affect the business of
the firm. The administration of the company also make its contribution in environment by
organising environmental saving program and activities. The company operate globally so
properly follow all the laws in effective manner which favourably affect the firm. When the
changes an d modifications are occurred in the legislation and polices of the government of
different countries then it negatively affect the firm in term of generating threats for it (Palo and
Tähtinen, 2013).
P5 SWOT analysis
SWOT analysis of Sainsbury's
The company has a strong market position and good brand image which positively
influence the firm and a strength of the company. The manage of the company maximise the
prices of the products due to increment in the raw material which negatively affect the company
in term of reduction in the customer base. By making business expansion through new products
the firm can various growth options. The company have a big threat of competitors because there
are number of competitors like Asda, Tesco and others which create competition for the
respective company.
SWOT analysis of Bank of England
The company has good brand image and have worldwide presence which is the strength
of the company (Shenkar, Luo and Chi, 2014). The management of the respective firm pay high
to its employees so it affect the economic situation of the firm in negative manner and show in
term of weakness. The firm can get business growth options by maximising the financial
information among youth. The company operate its business globally so change in government
plans and policies can affect the business of the firm.

TASK 4
P6 Strength and weakness interrelate with external factors
The business of Sainsbury affected by Political factor due to the situation of inflation was
rising in the market cause of Brexit so the prices of raw material and products are maximised
which affect the company in term of its weakness and threat. Sainsbury operate its business
globally so when changes in government regulations like taxation policy this affect the business
of the company. The firm make its contribution in minimising carbon footprint and wastage
reduction which it the strength of the organisation because with the help of it the firm positively
affect the environmental factor. Online shopping option of the firm and healthier food are the
growth option of the company which help in positively affect the company (Schaltegger, Freund
and Hansen, 2012.).
CONCLUSION
It has been summarised from the above mentioned report that every organisation has its
one business environment that keeps on changes according industry trend and competition.
Along with this, each establishment has its own size, scope and legal structure that help them to
accomplish its business objective in an effective manner. Moreover, there is a relationship
between business function that lead organisation to attain sustainable profitability ratio in a better
way. Furthermore, PESTLE and SWOT analysis enable organisation to analysis internal and
external factors in order to obtain profit maximisation.

REFERENCES
Books and Journals
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Berg, E. and Kilambi, K., Siebel Systems Inc, 2014. Method and apparatus to facilitate
development of a customer-specific business process model. U.S. Patent 8,639,542.
Chi, T., 2015. Business contingency, strategy formation, and firm performance: An empirical
study of Chinese apparel SMEs. Administrative Sciences. 5(2). pp.27-45.
Craig, T. and Campbell, D., 2012. Organisations and the business environment. Routledge.
Hillary, R., 2017. Small and medium-sized enterprises and the environment: business
imperatives. Routledge.
Ifinedo, P., Pyke, J. and Anwar, A., 2018. Business undergraduates’ perceived use outcomes of
Moodle in a blended learning environment: The roles of usability factors and external
support. Telematics and Informatics. 35(1). pp.93-102.
Janita, M. S. and Miranda, F. J., 2013. The antecedents of client loyalty in business-to-business
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Palepu, K. G. and Healy, P. M., 2013. Business analysis and valuation: Using financial
statements, text and cases.
Palo, T. and Tähtinen, J., 2013. Networked business model development for emerging
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Shenkar, O., Luo, Y. and Chi, T., 2014. International business. Routledge.
Schaltegger, S., Lüdeke-Freund, F. and Hansen, E. G., 2012. Business cases for sustainability:
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of Innovation and Sustainable Development. 6(2). Pp,95-119.
Tynan, C., McKechnie, S. and Hartley, S., 2014. Interpreting value in the customer service
experience using customer-dominant logic. Journal of Marketing Management. 30(9-
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Vitale, R. P., 2012. Business to business marketing. Pearson Education India.
Wetherly, P., 2014. The business environment: themes and issues in a globalizing world. Oxford
University Press.
Wheelen, T. L. and et. al., 2017. Strategic management and business policy. Pearson.
Weiss, J. W., 2014. Business ethics: A stakeholder and issues management approach. Berrett-
Koehler Publishers.
PESTLE Analysis of Sainsbury’s. 2019. [Online]. Available through:
<https://pestleanalysis.com/pestle-analysis-of-sainsburys/>.
Sainsburys SWOT Analysis. 2019. [Online]. Available Through:
<https://www.mbaskool.com/brandguide/lifestyle-and-retail/2042-
sainsburys.html>.