Contemporary Business Environment Analysis: A Case Study of Binatone

This report provides a comprehensive analysis of Binatone's contemporary business environment. It begins with an introduction to the concept of a dynamic business environment and its importance, followed by an overview of Binatone as a mobile phone company. The main body delves into microeconomic concepts such as demand, supply, and elasticity, illustrating their relevance to Binatone's operations. The report further examines the internal and external business environments through audits and a SWOT analysis, identifying strengths, weaknesses, opportunities, and threats. It also explores the impact of political, economic, social, technological, legal, and environmental factors. The report concludes with recommendations for Binatone, aiming to enhance its performance in the competitive telecommunications market.

Contemporary Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Business environment and Micro economic concept...................................................................1
External Audit .............................................................................................................................7
Insights about Micro Economic environment within which mobile phone business operate......9
RECOMMENDATION...................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
The meaning of contemporary is to belong to the same period of time and better
understand which helps which helps to deal with changes effectively. In dynamic business
environment there are different types of internal and external factors which are important to
focus or consider while running a business (Antonaras and Dekoulou, eds., 2019).
Contemporary business environment is said to be a continuous changing environment that
accepts the changes while running a business effectively. In business, changes occurs in demand,
supply, taste, employee engagement, customer preference and other which affects on business.
To deal with changes organisation also consider suppliers, customers, buyers and rival firms
which helps to perform a business properly. To understand about changing business environment
Binatone has been taken that is mobile phone company provides different types of mobile set to
customers. This report is about some topics such as demand and supply, price elasticity, internal
and external factors, demand curve etc. in context to selected organisation. Moreover, this
consider SWOT analysis to get the strength and weakness of organisation.
MAIN BODY
Mobile phone company is require to audit internal and external business environment that
helps to gain knowledge about micro economic environment
Overview of company - Binatone is one of the largest brand in telecommunication
sector. This organisation was formed in the year 1958 in UK by two brothers Gulu Lavani and
Pratap Lavani who import and distribute consumer electronics. Such organisation manufactures
baby monitors, Pet monitors, car accessories and headphones under the Motorola brand. This
serve worldwide area by providing products and services. The products are Landlines, Senior
phones, mobile phones, baby monitor, GPS, Tablets and two way radios. This is leading
organisation that offers different types of mobile phones and other products by bringing changes
in their manufacturing process and procedure. Such organisation operates business in consumer
electronic industry that sales products at economic price.
Business environment and Micro economic concept
A combination of internal and external driven forces are those factors which are
important to consider by business organisation while running a business. This involves
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government regulations, economic changes, market trend, employees, technological innovation,
social trend and management which affects business activities.
Demand – This reflects the actual quantity of products which is required by customers
for the purpose of fulfil their existing demand. A business get profits if products are in demand.
In other words, demand is the specific order which are required by people to complete the needs
and wants. This helps to increase the productivity of an organisation. Standard demand is created
by customers who buys products and services as per their perception (Prowle and Lucas, 2016).
Demand is related with quantity, price and quality of products which helps to rise the business
performance. It do not constant because of contrary business environment. Needs and interest of
people are changing day by day that increase the demand of new and attractive products. This is
important for business organisation to focus on customer demand and produced that kind of
products and services. In context to Binatone, demand of products is increasing because it
provides products as per customer wants after modification in existing products. Demand is
highly connected with price which make sure that organisation is earning profits. This is vital
principle of demand that states increase in demand in case of decreasing prices of products and
decrease in demand in case of incremental in price of products (Bitkowska, 2019). For instance,
Binatone is telecommunication company that provides products at economic prices which helps
to increase the demand. If organisation has adopted high pricing strategy then demand will
decrease.
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This demand curve states the adverse relation between price and quantity of products. It
helps to buy products by analysing the prices and quantity is selected accordingly. This shows
that if price of product is low then demand increases that impacts on business organisation
positively as incremental in sale (Schaltegger and Burritt, 2017).
Supply – This means to provide products and commercially by understanding the
demand of products. This is compared to the produced amounts through commodity price shift.
In other words, supply is the fundamental economic concept which is used to describe the total
amount of specific goods and services. This helps to generate the positive relationship between
value and amount that states when prices are risen of products then supply of products also
increases. Same as, if prices of products are low then supply of products also reduces due to
minimum demand in market.
This supply curve states that cost of products and quantity of supply are interrelated in
business market. If prices increases then it is positively upwards for organisation as supply curve
moves. In context to Binatone, management focus on this principle and provide products
accordingly by increasing production.
Elasticity – It said to a measurement of of proportional change of variable that bring
changes in another also. This is used to change the behaviour of supplier and consumer and
substitute of another products (Darlington, 2017). Market demand is influenced by price in case
of the product's elasticity is greater than 1, where as its not influenced by prices in case of
product's elasticity is less than 1. This involves different types of elasticity that are as defined:
 Cross elasticity: This elasticity of demand states the measures of responsiveness in
quantity of demanded products increases when the price of another product increases.
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This is calculated by taking percentage of change in quantity of demeaned products and
dividing the percentage change in price of other goods.
Cross Price Elasticity of Demand = (Q1X – Q0X) / (Q1X + Q0X) ÷ (P1Y – P0Y) / (P1Y +
P0Y)
 Price Elasticity: This elasticity is also consider as important measurement equipment
which helps to state the changes in price with quantity changes which is called price
elasticity. To calculate this such formula is used:
Price Elasticity of Demand = % change in quantity / % change in price
Such graph discuss that, price of product move from 50p to 60p then quantity of product
will be decreased as 100 to 50. for instance, luxury goods and substitution of product which
reduces production level (Child, 2015).
 Income elasticity – This is another concept of elasticity which define the relation
between income level and quantity of products. In other words, when people have enough
money that means they are ready to buy products more. Where as if they do not have
enough money then they buy products only for filling their needs. Calculation formula is
defined:
Income Elasticity = % Change in the demanded quantity / % Change in Income
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From this diagram it has discussed that quantity of goods are connected with income
level of customers, if they have high income level they good quantity will increase. Income level
has been shows by denoting Y and quantity by Q.
Internal Audit:
Internal audit is related with internal environment which is used by business organisation
to assure about strength and opportunities and remover the obstacles. This is important for
business organisation as all business get done internal audit by understand the needs and wants
and provide products accordingly (Phillips and Rumens, 2015). This is independent, objective
assures and consult activity in order to design value and improve the organisation's operation. By
using internal audit business performance can be increase and make efforts to improve the
production effectively. Internal audit is done by internal managers to know the situation of their
business and improve the business is required. Such internal auditor have right to change or
modify the policies by understanding the demand of organisation. To analysing or audit
internally there is required employees., manager, executives, shareholders and owners who
perform business activities effectively (De Castro, Hogenboom and Baud, 2016). In context to
Binatone, internal audit is done by internal auditors in their telecommunication company which
helps to define the strength and weakness of business also get changes to growing the business.
Such factor can be control by managers as it arises internally. Such organisation also focuses on
strong organisation culture such as task culture where roles and responsibilities of employees are
divided according to their qualification and experience in order to perform activities effectively
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and helps to attain the organisational goals (Jenkins and Williamson, 2015). Moreover,
organisational resources is also a part of internal audit in which auditor get information about
different resources such as physical resources, financial resources, human resources,
technological and informational which helps to improve the organisational performance and
increase the productivity. It has been stated that every organisation should audit the internal
business which is require to increase the production and profits (Eleonora, 2016).
Tools to audit the internal environment
Business environment auditing is used by organisation to analyse the impacts of different
factors on their business. SWOT analysis is consider as effective tool which state the strength
and weakness of business organisation. In context to Binatone, SWOT analysis is done by
internal auditor to identify the strength, weakness, opportunities and threats that are as defined:
Binatone SWOT Analysis:
Strengths Weakness
 Firstly it has launched Landline
android phones in the
telecommunication market which make
easy communication.
 This become the market leader by
providing the licensing of Motorola
video monitor that attracted customers.
 It has strong policies to the re-launched
its products which are profitable in the
market.
 It has also introduced android tablets
for the target customer as well as
market.
 It has global presence over wider areas.
 It has very less number of offers for its
customer in comparison of another
telecommunication.
 Due to increase demand of wire less
phones there is reduction in the sales of
fixed line telephones.
 Sometimes, customer changes their
minds quickly (Nuhu, Baird and Bala
Appuhamilage, 2017).
Opportunities Threats
 This provide a segment where wide
number of customers are available.
 It offers lower cost of its product as
compared to another segments.
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 Various another profitable product are
available in the market.
 Ability and capacity to improve its
power backup capacities by using new
technology.
 It can introduce the various types of
style of the phones in the markets.
 It has good market which targets
people for enhancing its operation.
 In some areas, fixed lines are given
more importances than to mobile
phones in that segments (Fenwick and
Wrbka, 2016).
Needs for auditing internal environment
It has been defined that auditing of internal environment is needed for business
organisation because it helps to get the opportunities and strengthen the business. By using this
threats and weakness can be overcome by organisation effectively. It is also needed for Binatone
organisation which provides different types of communication sources to know the strength and
opportunities which helps to make higher profits (Grant, 2016). Moreover, by auditing internal
environment the threats can be overcome to improve the production and supplying process.
External Audit
This means auditing of external environment which covers different factors such as
political, social, economical, technological, legal and environmental factors which many impacts
on country as well as business organisation. This is important for business organisation to follow
such factors while running a business (Geppert and Pastuh, 2017). For instance, Binatone is a
multinational electronic industry that produces different types of communication equipment qand
operating business successfully. Political factors states that organisation should follow all
government rules and regulation for operations, economical factor is related with inflation,
interest rate and income level of people that helps to make the buying decision, social factor is
related with needs and wants of society such as change in culture, tradition, values and behaviour
which impacts on business organisation, technological factor is related with new technology and
innovation in business which has impacted on business, Legal factor covers laws and regulation
like employment laws, food and safety, health and safety etc (Jenkins and Williamson, 2015).
which is important to follow, and last environmental factor which also impacted on business
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organisation. To auditing the external environment PESTLE analysis should be done by
organisation to know the impacts. PESTLE analysis in context to Binatone is defined as:
Political factor comprises with political system, government policy, tax rates, trade with
other country etc. that impacts on Binatone organisation such as reduction in inflation rate
impacts positively as its production can be increase, company will produce more mobile phones.
The negatively impacts is change in UK's government so new regulation and trade policy may
intervene the business activities badly. Economical factor has direct impacts on country as well
as company's functions. Economical factor such as trade exchange rate, economic cycle,
currency rate, income level etc. Reduce in the rate of labour cost is beneficial for Binatone
telecommunication as it get more production of mobile phone which are carting globally which
helps to make profits. On the other side, if disposable income level of customers is decreased
then production and sale of business organisation will decrease because customers get not ready
to pay for their desires instead of needs (Malik, 2015).
Social factor encompasses the economic and cultural phenomenon which helps to
increase the market image of brand, and organisation. There are different type of people in UK
who have different culture and interest. This is important for organisation to follow them and
provide products. Binatone is taking advantage of such factor and produce mobile phone as
simple to use, smart devices and smart display phone to customers which increase sale of
products globally. If organisation do not focus on different culture and interest then people
switch other brand which may impact negatively on business organisation. Technological factor
is observed that modification and changes in technological process which affected the business
organisation in both manner. By applying new technology Binatone introduces new mobile
phone hand set as per customer comfortable and wants which helps to improve the sale and
profitability of business organisation. Other side, to research and adopt the new technology
Binatone invest high amounts and cost which direct impact on profits as it reduces (Geppert and
Pastuh, 2017).
Legal factors is related with laws standard and regulation which is compulsory to follow
by business organisation while working or performing business activities. Binatone is electronic
based organisation that follows all legal laws as food and safety, proper facility, job security,
health safety etc. which attracts employees and they work well by feeling comfortable. In
contrary, in case of not following the health safety and job security employees make plans to quit
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job which affected business badly. And last, environmental factor which is also important to
follow by organisation as this is becoming big issue for organisation to keep clean and healthy
environment by following the environmental laws. Organisation should not work or use harmful
good to make products and running business. Binatone is getting benefits of such organisation as
it launches mobile phones by following environmental laws in which it increases greenhouse
gases and fossil fuel use which helps to improve the production and business performance. In
contrary, climate change can create global warming that can disrupt transoceanic shipping
(Panayides and Song, 2015).
Insights about Micro Economic environment within which mobile phone business operate.
Micro economic environment is connected with some factors such as customers,
employees, competitors, shareholders, suppliers and media which are affecting a business
(Impacts of microeconomic factors, 2019). For example, Binatone which is mobile phone
company cannot successfully operate profit making organisation without influencing target
customers, without qualified employees it cannot maximise production and to operate a business
profitably there is need to get good value on products and supplies to get the good business.
Moreover, competition level of business decide the position of brand in business market which
affects business and decision is also made by investors by analysing the financial position of
company which is affecting such industry (Kasemsap, 2015).
Potential Benefits for the Company:
 Binatone's target customers are more loyal because it provides better quality of products
and electronic gadgets.
 Uses of more and more latest innovation to provide new product.\
 Focus on customer's income level, culture, interest and legal regulation to improve
operations.
 For increasing sales of company it targets each customer segment reducing price to the
most specific economic point.
RECOMMENDATION
 In context to Binatone, it should more focus on aggressive innovation and cost of
product.
 New technology and updation of existing product.
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 High command on distribution system, supply chain.
CONCLUSION
From the report it can be included that business environment is the sum of internal and
external factor which are analysed by business organisation to know the impact. There are
numerous tools which helps to auditing the micro and macro business environment. PESTLE
analysis is used to get the good and bad impact on business organisation which are
uncontrollable. SWOT analysis states goodness, weakness, expanding changes and problems to
run a business. Internal audit is require to perform well which is done by internal auditor where
as external audit to is require to know the good and bad impact of external factors. Micro
economic concerns or related to making decisions by individuals and small groups like clubs,
firms, governmental agencies etc. there are various process which is used by business entity to
increase the production and profitability.
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