Business Environment Analysis Report: ASDA PLC - Module Report

This report provides a comprehensive analysis of the business environment, focusing on ASDA PLC, a leading retail organization in the United Kingdom. The report begins with an introduction to the impact of the business environment on company performance, followed by an overview of different types of business organizations, including sole traders, partnerships, and limited companies. It then delves into the influence of stakeholders, both internal (employees, customers) and external (community), on the objectives of businesses, contrasting the approaches of ASDA and the NHS. The report further examines the organizational structures of ASDA and the NHS, exploring how their structures enable them to fulfill their purposes. Additionally, it describes the impact of economic environments (stable and recessionary) on business activities and analyzes the influence of political, legal, and social factors on ASDA's operations. The report concludes by summarizing the key findings and providing relevant references.

Business Environment

Table of Contents
Introduction...........................................................................................................................................3
Task 1.....................................................................................................................................................3
P1 Different types of business organization .....................................................................................3
P2 Different stakeholders its influence the objectives of two contrasting business ........................4
Task 2.....................................................................................................................................................5
P3 Describe how two businesses are organised...............................................................................5
P4Explain how their style of organisation helps them to fulfil their purposes.................................6
Task 3.....................................................................................................................................................7
P5Describe the influence of two contrasting economic environments on business activities within
a selected organization.....................................................................................................................7
Task 4.....................................................................................................................................................7
P6 Describe how political, legal and social factors are impacting upon the business activities.......7
Conclusion ............................................................................................................................................9
REFERENCES.........................................................................................................................................10

Introduction
Business environment is having a large impact on company and its future performance. It is
too complex and competitive which needs a careful analyses and evaluation of business
environment in order to minimize its impact (Cantwell, Dunning and Lundan, 2010). The
present report is based on ASDA PLC which is one of the leading organization in retail and
conduct their business in United Kingdom. The main purpose of this study is to analysis
various aspects and different types of business and how they perform in an effective manner
to attain their long term goals and objectives.
Task 1
P1 Different types of business organization
There are three main types of business that those seeking self-employment can look to
establish: sole trader, partnership and limited company (Cavalcante, Kesting and Ulhøi,
2011). Each differs in terms of the paperwork you must complete, the tax you must pay, the
way in which profit is distributed, and your personal responsibilities if the business makes a
loss.
Sole trader: This type of business is owned and managed by one individual. There's no legal
distinction between the owner and the company, meaning that all debts and after-tax profits
are personally yours - this is called 'unlimited liability'. Specialist service providers such as
plumbers, hairdressers and electricians are often sole traders. Sole trader businesses are easy
to establish and discontinue, are subject to relatively few regulations, and typically have
relatively low running costs. The owner is responsible for keeping day-to-day financial
records, but hands responsibility for the end-of-year accounts to a professional accountant
(Chesbrough, 2010).
Partnership: Similar to sole traders in the sense that they are subject to unlimited liability,
partnerships differ in that they involve two or more people pooling their expertise to own and
manage the business. Professional service providers such as dentists, doctors and accountants
often fall into this category. Partnerships usually offer the advantages of shared
responsibility, reduced time pressure for each individual, and an increased level of financial
clout and specialisation (Child and Möllering, 2013).
Private limited company: There are two types of limited companies: private limited
companies and public limited companies. The former are often small businesses that don't

trade on the stock exchange, while the latter are usually well-known businesses that do.
Unlike sole traders and partnerships, these businesses are registered at Companies House and
have their own legal rights and obligations (Kaplan and Norton, 2015). Ownership is divided
into equal parts called shares. Anybody who owns one or more shares is a shareholder.
P2 Different stakeholders its influence the objectives of two contrasting business
In this section I will be describing different type of stakeholders internal and external. Also
explaining who they are and what they are, then contrasting them with two different
companies NHS and Ford Motor describing what the stakeholders want from the chosen
businesses and why the stockholders are useful.
Stakeholder is a person who is in an organisation and is affected by the organisation in terms
of strategy and project. Stakeholders can be internal or external at different levels e.g.
Internal stakeholders are groups within a business such as owners and workers and external
stakeholders are groups the outside a business such as suppliers and community.
List of internal and external stakeholders and explanation of what they are and who they are:
Employees: Their stake is that the company provides them good rates of reward and
promotional opportunities. They also want a very good security of employments. Also they
are concerned about their salary (Lewis and Gates, 2015).
Customer: The reason for a company’s existence is to provide products or services that meet
the needs of its target customers and benefit them in a meaningful way. The role of customers
is critical to the company’s survival and success. Through the purchase decisions they make
each day, they select which companies will prosper and which will fail.
Community: The community provides the skilled workforce that a company depends upon to
maintain its competitive edge. Members of the community, including the news media, often
play a watchdog role, ensuring that the company is a good citizen with fair business practices,
concern for the environment, and a willingness to contribute to charitable and social causes.

Task 2
P3 Describe how two businesses are organised
It is essential for an organization is to manage their operation in an effective manner in order
to achieving long term goals. In the context of current report, there are two corporations
which having their own organizational structure.
National Health Service: There are following structure of the public entity is given below:
Line and Staff Organisational Structure: Most large organisations belong to this type of
organisational structure. These organisations have direct, vertical relationships between
different levels and also specialists responsible for advising and assisting line managers. Such
organisations have both line and staff departments. Staff departments provide line people
with advice and assistance in specialized areas (Tapscott and Caston, 2013).
ASDA: There are following structure of private sector company is mentioned below:
Also commonly called a bureaucratic organizational structure, the functional structure divides
the company based on specialty. This is your traditional business with a sales department,
marketing department, customer service department, etc. The advantage of a functional
structure is that individuals are dedicated to a single function. These clearly defined roles and
expectations limit confusion. The downside is that it’s challenging to facilitate strong
communication between different departments.
Human Resources: The human resources or personnel department is responsible for hiring
employees and ensuring that they get the proper training to perform their jobs.
Marketing: Marketing professionals determine the products that their companies introduce
to the marketplace, often using marketing research surveys to determine what consumers
need and want. This helps the company to better align its strategies.
Customer Service: Customer-service representatives answer calls or in-person requests from
customers. Some customers may want additional information about a product or service;
others have problems related to the products they purchased.
Accounting: Accounting professionals usually work in one of three areas: accounts
receivable, accounts payable and payroll. Accounts-receivable specialists track the debts
owed to the company. For example, customers who purchase items on credit fall within the
bailiwick of accounts-receivable employees (Teece, 2010).

P4Explain how their style of organisation helps them to fulfil their purposes
It is essential for a business entity to use various organizational approaches in order to attain
organizational goals and objectives. These are:
Strategic aim: Managers who make decisions that affect the route of an organisation need to
show those choices to others. The way in which ASDA does this is through its mission,
purpose and values. These statements are designed to help stakeholders understand the
direction in which the company is heading. A mission statement sets out the long-term
direction of the organization. ASDA's mission is:'to be Britain's best-value retailer exceeding
customer needs always'. As well as having a mission statement, ASDA has a statement of
purpose. This helps stakeholders to understand why the business exists. ASDA's purpose is
'To make goods and services more affordable for everyone'.
It intends to increase the amount of fresh products sold loose from boxes and reduce its range
of own label pre-packed products sold in its stores across the country is key objective.To
offer quality products at low price is another aim of ASDA (Yew Wong and Aspinwall,
2014). In order to cover this aim they buy products from highly competitive supplier. They
also use their own packing and brand name to reduce packaging cost.
There are following SWOT analyses for ASDA
Strengths 1. Wide range of product offerings and service offerings include financial
services
2. Known for its amazing marketing campaigns
3. In constant touch with its customers via social networking – asks
feedback, conducts competitions, etc.
4. Socially responsible through CSR initiatives
5. Has over 140,000 employees working at over 500 stores (Ward at.el.,
Sum,2012).
Weaknesses 1.Limited global presence as compared to few other competitors
2. Their ability to sell prices have restricted their entrance is few
countries as the country fear a competition with local vendors
Opportunities 1.Expanding in new areas of pharmacies, opticians, jewellery and photo
department.

2. Venturing into markets that are growing like India, China etc
Threats 1. Price war with other retail chains brands
2.Pressure of maintaining low prices.
3. Ever changing policies of various central govts.
Task 3
P5Describe the influence of two contrasting economic environments on business activities
within a selected organization
The economic environment is the totality of economic factors, such as employment, income,
inflation, interest rates, productivity, and wealth, that influence the buying behaviour of
consumers and institutions.
Stable economy: Stability in the economy is forever changing again for good and bad and it
all depends on if company need changed are buying habits, if we spend more we will have a
strong and stable economy and it’s the opposite for a bad and unstable economy, if people
spend less and save more the economy will begin to full because the money is not being spent
Recession economy: when there is a decrease in growth and this can be because of two
reasons, the first is that the consumer is cutting back on the amount on which they are
spending (they may be saving more instead of spending) and this will lead to the
manufactures to cut back on how much they order from suppliers (Chesbrough, 2010). This
will result in cut backs and this will then lead to business making people redundant because
they cannot afford to hire them.
Task 4
P6 Describe how political, legal and social factors are impacting upon the business activities
The external environment is too complex and competitive which required a careful
examination of these factors in order to attain success. These are:
Factor ASDA NHS
Political ASDA is operating
primarily in UK. Currently,
the political environment in
UK is generally stable.
This factor is having large
impact on National Health
Services. Because
government provide various

Stability is good for
businesses. However, there
are talks that the government
debt in United Kingdom is
too high. If the trend of
increasing government debt
persists, there are
possibilities that UK may
face serious sovereign debt
issues as in the case of the
countries. There are talks on
UK government to reduce
subsidies and
implementation of financial
austerity programs in the
country (Cavalcante,
Kesting and Ulhøi,2011).
fund in order to running
health care. But due to
uncertainty in the political
level they reduced
performance level.
Legal Overall, ASDA is a legal
business. However, some of
the observers commented
that ASDA is using
misleading advertising,
using suppliers with illegal
employment practices, and
lacking environmental
serious policies. All these
are issues to be concerned
by management, and unable
to fulfil the legal
requirements may cause
ASDA to face contingent
liabilities in the future
There are various laws and
legislation regarding health
and social care. But increase
in laws and legislation
having adverse impact on
NHS and its customer
service.
Social The rising standard of living Due to increase the standard

of people is having huge
impacts to the UK social
structure. Firstly, higher
proportion of women has
been found to be joining the
employment rank. Besides,
as the consumers enjoy
higher standard of living,
they are also becoming more
demanding. It is harder to
fulfil the higher expectations
and demands from
consumers in today business
environment.
of living where they can use
public health care services
which is not good for the
corporation(Cantwell,
Dunning and Lundan,2010).
Conclusion
As per the above mentioned report it has been concluded that business environment is to
complex which required a careful analyses. The present report explained about the different
types of business organizations and its aim and objectives. The influenced the purpose of two
corporations by stakeholders such as employees, customers, suppliers, investors etc. So that
the cited entity can attain their long term goals and objectives in an effective manner.

REFERENCES
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586.
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scorecard companies thrive in the new business environment. Harvard Business
Press.
Lewis, R.D. and Gates, M., 2015.Leading Across Cultures. Nicholas Brealey.
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Ward, P.T. at.el.,Sum, C.C., 2012. Business environment, operations strategy, and
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