Business Environment Report: Analysis of Marks and Spencer (BUS101)

This report provides an in-depth analysis of the business environment, using Marks and Spencer as a case study. It begins by defining the business environment and its importance, then explores different types and purposes of organizations, distinguishing between public, private, and voluntary sectors. The report examines the size and scope of various organizations, illustrating differences between small, medium, and large enterprises. It delves into the relationship between organizational functions and objectives, followed by an assessment of the positive and negative impacts of the macro environment on business operations. Furthermore, it includes internal and external analyses of Marks and Spencer, highlighting the interplay between strengths, weaknesses, and external factors. The conclusion summarizes the key findings and insights, providing a comprehensive understanding of the business environment and its influence on organizational success.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purposes of organisations.......................................................................1
P2 Size and Scope of various types of organisations .................................................................4
TASK 2............................................................................................................................................7
P3 Relationship between different organisational functions and its link with organisation
objectives ....................................................................................................................................7
TASK 3 ...........................................................................................................................................9
P4 Positive and negative impact of Macro environment on Business operations.......................9
TASK 4............................................................................................................................................9
P5 Internal and External analysis of Marks and Spencer............................................................9
P6 Interrelation of Strength and weakness with external Macro factors..................................11
CONCLUSION..............................................................................................................................11
REFERENCES .............................................................................................................................13

INTRODUCTION
The business environment can be defined as a area where different kinds of practises of
activities and operation of the business are conducted in very effective manner that provide help
for attaining the pre determine objective and goals of the firm. Business environment is
containing both of internal and external elements which are marking impact on the functioning of
the firm that also involves their employees, customers and partners and so on. It is very essential
for each and every firm to understand the environment in which company is perusing their
business operations and suits firm's business nature (Dahan and et.al., 2010). It will help in
generating more and wider profit in the market and attaining growth as well as development.
This company, in which the report project is based on is known as Mark and Spencer. This is one
of the best retail and clothing or accessories firm; operating in UK. This firm is dealing in many
different sectors successfully as well. The cited report is discussing about the nature, size and
scope of the firm, performing in various kinds of business environment. Along with it, their
association with other organisational functions and their connections with the objectives of the
firm will be attained. It will provide help in order to understanding the both negative and positive
affects of the micro environment in an organisation.
TASK 1
P1 Different types and purposes of organisations.
In the present business environment, there are different types of firms who are bring out
their business operations with in their desired sector with the purpose of attaining more and more
profit and also fulfilling their objectives or aims as well. Their prominent aim is to capture more
of buyers towards then and also enhance the level of their standard of living too. The two major
sectors who are involves in business environment are names as public sector and private sector
and their working are done either for profit or not for benefits that acting as an NGO as well.
Hence there are a comparison of these three divisions of working which is as follows-
1

Basis of Comparison For Profit NPO NGO
Meaning It can be determine as
the body that is being
launched with the
objective or aim of
having profit only. The
core target of these
types of firms is to
hike up their rate of
revenue through
selling their product
and services in the
market.
It comes under those
types of the firms
where selling of the
goods and services is
done with out having
any objective of
earning benefits. The
fund that is received
through selling
products and it is not
shared with the any
one or owner also it is
reinvested in the firms.
It is determine as a non
governing body whose
prominent aim or
objective is to do
welfare for the citizen
or nation or of the
society and also
launched themselves
in to various places as
well. These types of
businesses are
basically done with the
one and only
individual or person.
Area of Operations It can be larger as well
as limited
Limited Large
Objectives Their core objective is
to capture more and
more numbers are
customers and
generating revenue for
the firm.
It is being established
for promoting science,
art and commerce
among more of
individual.
Their core objective is
to develop the entire
society through
conducting different
types of practises for
building the strong
economy as well.
There are three prominent factors along with their purposes, which are detailed such as-
Public Sector -in this kinds of sectors, the structure of the entire firm is designed and
framed by the government of nation and the earning that is generated here is majorly shared by
the different numbers of persons who are working in an organisations. In the UK, the cited sector
2

is also rolling essential role in order to facilitating jobs to wider numbers of persons in the entire
country. It is defined that the minimal numbers of the individual are required for starting a
business or firm in public sector hence 7 persons are needed for the same and other side
maximum is unlimited rage of individuals. For an example- mark and Spence is an open area
firm who is working in public sector. They are having their focus on the working class persons.
Purpose – These types of the firms are having their core concentration on the developing
nations or economy and facilitates help to individual who are not having may types of fixed
income. Hence they are helping hands for the nation through creating more numbers of jobs.
Private Sector – in these types of divisions, organisations are prominently developed to
earn profits and to sell more of goods and services in the concentrated market location. In the
coming years, there are different firms which are growing at a very faster rate and maximum of
private firms only. These kinds of the organisations are allowed to have more numbers of
stakeholders as each and every firm is issuing their share in the market. As an example- a firm
that is referred as Sainsburry is comes in the private sector (Cronan and et. al., 2011 ). This firm
is an international retailing chain which is providing products and services for the benefits of
their buyers and to enjoys more profit as well.
Purpose – the prominent objective or goal of these kind of firms who are working in
private sector are to identified the real requirements and demands of the buyers so that products
and services can be sold to customers in accordance to their wants.
Voluntary Sector – these are the those kinds of organisation in which group of
individual take step in into an agreement or voluntary come into contract with the purpose of
attaining their objective and goals (Commander and Svejnar, 2011). They majorly doing planing
that helps in development of economy through removing all the hurdle form the environment as
well as create harmony in the society. Many firms falls down in this sector but the cited report
welcome trust is selected. Which is a biomedical research charity.
Purpose – The prominent objective and goal of these types of the firms is to develop the
economy of nation through framing its divisions in effective and proper manner.
Legal Structure of the Sectors:
Private Sector: The structure which can be framed in these types of the firms are as
follows-
3

 Sole Proprietorship – Here, all the business operations of the firm is controlled by
a single individual or persons and that unit is the solely responsible for the entire
profit or losses of the firm.
 Partnership – In this, two or more of person are come together and make sign for
a partnership deed to here, they are having legal permission for bring out a
business or firm together in which all of them are having equal part of entire
profit.
Public Sector: The legal structure of these types of the firms are explains such as-
 State Government – In this, all the firms required to follow all the rules, policies
and provisions that are designed and formed by the government of nation and
after wards along with providing the administration and different other things in
the commercial division for the development of country's economy.
 Local government- This type of government body is mainly looking for the
prominent elements for the local commodities along with it they facilitates
welfare to the society.
P2 Size and Scope of various types of organisations
Since it is determine that now a days market is become so complex and competitive
hence it is very essential that all the operations of the firm is being conducted in a very effective
and efficient manner. It also provide help to them in order to attaining the growth and
development in the market place as well. In the business environment, all the firms are generally
falls down in some parts on the basis of their size and the categories are known as small scale ,
medium scale and large scale (Chow and et. al., 2011 ). There are various other elements as well
in which they can be separated and it is like numbers of staff or individual is needed in order to
start a firm with the help of their structure as well. In accordance of the sizes of the firms;
companies are detailed such as-
Private Sector Companies – The firms who are working under this division is determine
as the most essential part of the economy as they provide help in the nation through generating
more and higher revenue by performing all the business practises at local, international, or nation
level. As Marks and Spencer, they are operating their business activities since 1884 in the United
Kingdom. Other side Size of private sector firms are detailed as-
 Minimum numbers of staff individuals-2
4

 Maximum numbers of staff members- 50
the size of Mark and Spencer is detailed as-
 The firm is having approx 9610 stores chains in across the United Kingdom and
also they are having total 1433 in the across the globe.
 The firm Mark and Spencer is employing nearly 82904 workers in their stores.
 Their clothing division or segment is seeking growth with 11 percent in the past
recent year.
Public Sector companies – In these type of the firms, their size and the scope in being
framed on the basis of kind of business organisation. The prominent work of the firms is to build
up a segment for the welfare of the society and concentrate on their needs and demands which
required to be satisfied as well (Boons and Lüdeke-Freund, 2013). Sainsbury is conceder as the
public limited firm that is having different several kind of joint ventures in the world. Hence, the
size of public firms are detailed as follows-
 Minimum numbers of the staff individual in these firm is 7
 Maximum numbers of the employees in this kind of company is Unlimited
The size of Sainsbury can be explained as follow-
 The firm Sainsbury is established in the year of 1869 . they are selling several
types of products and services through the help of their supermarkets and
convenience stores and so on.
 Presently, they are having more then 181900 numbers of workforce, who are
working in their firm.
 Sainebury's stores are located at more then 1400 places all across the world.
Voluntary Sector – in this kind of firms, fund is conducted form various investors and
sponsors. Welcome trust is consider as voluntary organisation hence, it is registered in the
United Kingdom and some of around 2 charitable trust are also working under this voluntary
sector. It is launched in the year of 1942 as an international non governmental firm who are
concentrating at disaster relief and biomedical research.
Objectives differentiation:
5

Micro Small Medium Large
The prominent
objective of these
types of the firms is to
attain living so that
society will get
secured, financially.
In these types of
organisations, they
majorly concentrate on
the maintaining health
and higher lifestyle
and also attaining
opportunities that are
available in the market
place.
In the same phase,
they prominently
concentrating on the
expending the business
in to the international
market so that they can
have a effective and
good positions in these
types of market and
with the help of it they
become a global
leaders as well.
These division and
sector involves those
firms who are working
successful form may
years and their
prominent objective is
structuring the nation's
economy and
providing stability
with in the
environment of
country as well.
Other firms are involved here are detailed such as-
Transactional Company- these kind of firms are bigger and they are having spread their
business activities in different parts of the world. Sometimes, it is seems that transactional firms
are majorly huge in comparison to the entire nation that is under development. Hence, these
types of the firms are provide help for the economical development as they are generating larger
numbers of employments opportunity (Burns and Winter, 2011).
Licensing – these are the types of firms who are providing permission to other
organisations in order to produce product and services under the name of their brand. This a type
of deal that is fixed on some certain payment. This is very profitable procedure as it provide help
to the firm in order to attaining a effective position in the market place.
6

TASK 2
P3 Relationship between different organisational functions and its link with organisation
objectives
It is known that each and every firm is being framed because of their various
different objective and aims hence the operations or business practises are done by
then in the environment of business which is also different, therefore it is very
essential for these organisations to framed their firm's structure as their objective
and goals so that firm can be able to attain all their aims in effective manner. Since
Mark and Spencer is operating as the public limited firm and they are having
workforce more them 85000 in numbers. It is now known as a multinational firm
that are dealing in different segments or various range of product such as food
goods, luxury items and so on also for producing things, firm needs some amount
money so that all of these practises are done in effective manner ( Bar-Isaac and
Shapiro, 2013.).
It is also observed that Mark and Spencer is having an organisational
structure which is named as Flat structure as their all business practises are
conducted by their employees who are performing in their shops. With the help of
these kinds of structures, Mark and Spencer is facilitating encouragement and
motivation to their workers so that they can provide their contribution in the
process of decision making that is carried out with the purpose of making new plan
and policies for the firm. Since the Mark and Spencer is having so many workers so
if they will include in their decision making procedure then it will be profitable for
the firm.
Various kinds of functions that is performed by Mark and Spencer; all of
them are such as- HRM, Research and Development division, Sales, Accounting,
Finance etc.. The workers who are rolling the operations, they are needs to be very
effective so that they can provide help in order to attain the pre determine objective
and goals of the firm. It is required that the functions are have to be relevant to the
structure of the company so as to attain the goal and objective of the industry in a
very effective manner (Adeoye and Elegunde, 2012)
7

Therefore the interrelation of the firm's structure with the other functions
being detailed as follows in the context of Mark and Spencer:
Marketing Department : it is one of the best and important function that is
being conducted in the firm as with the help of it they will be able to sell their
product and services in to the market place. This division or department is
facilitation help though identifying the requirement and needs of their buyers hence
for that product and services will be produced in accordance to it. It is having
association with different other segments in the market locations and performs
different kinds of practises as well. It is very effective in order to attain the
competitive advantage in the serving market as well.
Human Resource Department – the practise performed by the cited
department is having their effects on the entire firm because it provide aid to the
firm through recruiting talented and skilled employees for the firm who are able and
capable of performing all the divisons of the firm. They are facilatating aid to iother
department for the firm in order to creating coordination and cooperation in
between them.
Production and Operations - This is a type of function that is conducting at
the beginning of the procedure when the products and services are being
manufactured at the starting level. It is having a associated link with the structure
of the firm as the products will be manufactured in accordance to the set plan only.
Mark and Spencer is also making their goods after evaluating the market so that the
goods can satisfy their demand and the objective or goal can be attained ( Avramenko,
2012).
Accounting and Finance – this is a type of function that is having their
association with the monetary transactions that is occurring in the nation on daily
basis. These are the divisions who are forecasting funds to various different
departments of the firm so their practises can be bring out in a appropriate manner.
It involves development of the assets, creating survey in market and so on. Hence,
by the availability of the department firm will also perform.
Research and development – it is the department or division who are
having the duty and responsibility of producing product in accordance to the needs
8

and wishes of the buyers. Mark and Spencer, it is larger firm hence appropriate
research is needed to be conducted so that they can identify about their wishes and
needs of the customers as well.
TASK 3
P4 Positive and negative impact of Macro environment on Business operations
To know the positive and negative impact of the elements of firm. In context
of Mark and Spencer; PESTEL analysis is conducted. Such as-
Political factor – all of policies which are framed by the governmental unit is
included in it. Hence, nation's government will introduce new law and rules for the
production of the product. It helps them to firm for operating practises in effective
manner but some time government increase rate of the resource ( Auzair, 2011).
Economical factor – these elements are having association with the elements
like growth rate, inflation of some certain firm. Its positive effects are like if there
is inflation then the fund flow will be boost up but it is a dynamic environment in
which hard to manage with change.
Social Factor –firms are having resource s form outer world or environment
so it their responsivity to provide them something in return hence it is called
corporate social responsibility.
Technological Factor – in this elements, many of new technologies are
launched by the researchers in the society that is utilised by the different numbers
of firm so they do their work properly.
Legal Factor –it involves laws and rules that is framed by the government
and it is required to be imposed by the every firm.
Environmental Factor - it is having all elements that is interlinked with the
environment and it will make strong effects on the firm as well.
TASK 4
P5 Internal and External analysis of Marks and Spencer.
SWOT Analysis of Mark and Spencer
Strengths:
9

High recognition of the brand: M&S is the most popular organisation which has strong
brand values in the market. It is large firm of the UK's high street so that number of people know
about this as it provide quality of products and services in the past years. Its brand value is very
high because people prefer M&S for purchasing cloths and accessories.
Wide variety of products: There are numbers of items or products that selling by M&S in
the market. They provide variety of products at every stores so that customers can reach and take
purchasing decisions regarding effective items or goods. Consumers can buy any items such as
cloths, vegetables, fruits, accessories and many more to satisfy customers needs and wants in an
effective manner (Aterido, Hallward-Driemeier and Pagés, 2011).
Large numbers of stores and outlets: M&S has various stores at the different countries.
Around 600 in the UK and 300 in over the 40 countries. It can be said that M&S has numbers of
stores and capture wider market at global level. It is an essential for increasing sales volume and
generate higher revenues in an appropriate manner. They provide various commodities to the
people at cheapest costs with good quality.
Popular designer brand: in this consider that M&S manufacture good brand and
qualitative products and services so that number of customers can be attracted in an effective
manner. It produce cloths which has wide range of brands as in this included autograph,
Big&tall, Blue harbour, North coast etc. same in the men or women brands so it is biggest
strength of this organisation.
Weaknesses:
Bad publicity as non trendy store: M&S company has low or poor publicity of its brands
so that it has negative impacts on the business and sell of products and services. This
organisation produce out fashioned and non trendy which affects on the behaviour of customers
and their purchasing decisions.
Manual working increases the costs: In this, M&S is following its old techniques for
producing goods and services which are causes in increasing costs or expenses so it is the major
drawbacks of this company.
Opportunities:
Mark and Spencer has the opportunities to increase the sales at global levels as they can
expand its business internationally. There are various opportunities for business expansions at
number of country because it is well known organisation and have good reputation in the market
10