HNBS 301 Business and the Business Environment Report: Analysis

This report provides a comprehensive analysis of the business environment, exploring different types of organizations (public, private, and voluntary) and their legal structures. It examines the size and scope of organizations, the interrelation between organizational functions, and the positive and negative impacts of the macro-environment on business operations. The report includes SWOT and Porter's five forces analysis of Amazon, identifying strengths, weaknesses, opportunities, and threats, as well as the interplay between internal and external factors. It also covers the relationship between the business and its environment, including political, economic, social, technological, environmental, and legal considerations. The report concludes with a summary of the key findings and references relevant sources.

Business and the Business
Environment

Table of Contents
INTRODUCTION................................................................................................................................3
LO1.......................................................................................................................................................3
P1 different type of organisation and their purpose and legal structure..........................................3
P2 size and scope of different organisation ....................................................................................4
LO2.......................................................................................................................................................4
P3 Relation between different organisation functions.....................................................................4
LO3.......................................................................................................................................................5
P4 positive and negative impacts the macro environment has upon business operations..............5
LO4.......................................................................................................................................................6
P5 Internal and external analysis of specific organisations in order to identify strengths and
weaknesses.......................................................................................................................................6
Porter 5 forces Analysis........................................................................................................................6
P6 Strength and weakness interrelate with the external factors.......................................................7
CONCLUSION....................................................................................................................................7
REFERENCES.....................................................................................................................................8

INTRODUCTION
Business is a process where goods and services are exchanged for money. Business
environment refers to the environment which include internal and external factors in it and they
affect the whole business too much. It is all about customer satisfaction that how their demand meet
with the business. Amazon was founded by Jeff bezoar by 1994. It has high retain chain market in
the world. This report will include the summary of business and business environment and different
types of business public, private and voluntary business and what area the legal structure of it and
how it performs in the organisation and environment. Difference between small, micro, medium and
large type of organisation and their sustainability(Virglerová, Dobeš and Vojtovič,2016). Link
between the organisational functions that how they interrelate with each other.
LO1
P1 different type of organisation and their purpose and legal structure
Public sector- This is the organisations which totally formed by government. It exists for
providing services to citizens and focuses on essential and basic products. They are properly formed
with the rules and regulation of the government. For example amazon is the public company which
is formed by Govt.
Legal structure- It runs by the board of directors with help of the shareholders. It can sell their
stokes on stock exchange and also can more profitable in comparison to private company They
follow the structure to earn dividend per share on best price. It is an incorporate business.
Private sector- Private sectors are totally formed with their own rules and regulation. Only
a few laws impact on the private sectors and this sector are only focuses on make profitability and
increase credibility(Virglerová, Dobeš and Vojtovič,2016).
Legal structure- Private business has its secret legal identity. If it wants to be a public company than
it have to change the memorandum of association and article of association. In private sectors the
shareholders are also they part of the organisations and they attain meetings and also give their
response to them.
Voluntary sector- Voluntary sectors are non profit and non government organisations they
exist for serve their better to the society. Its primary purpose is to make benefit for social welfare
and public. It is called third sector because it is mixed sector. In this sector people works together in
community for social welafre

Legal structure- It is an unincorporated association. It is also in a form of charitable trust. It has no
separate legal existence. They are cheap to set and easily affordable by anyone. They have not pay
any fees regarding legal structure of the organisation because this organisation is made for public
welfare. They have to take license for run the organisation from which Govt. knows that it is only
for social welfare.
P2 size and scope of different organisation
base public private voluntary
company name Amazon Marks and Spencer royal voluntary service
number of employees 613300 84339 not fixed
scope Limited scope due to
different types of rules
and regulation and
properly follow to
Govt. legal structure,
It has no limited scope
because these
organisations runs by
an individual. These
organisations are not
governed with lots of
regulations.
They also have limited
scope because they
only work for social
welfare.
purpose serve essential product
to public
only a single aim to
make profitable
organisation with
credibility.
This type of company
exists for the social and
public welfare
LO2
P3 Relation between different organisation functions
It shows interrelation between the different departments under the organisation. Many types
of different organisations function are here. like interrelation between operational department and
management department. In the operation departments many of the operational works includes like
production department, marketing and sales department etc(Virglerová, Dobeš and Vojtovič,2016).
In Amazon they all department linked with each other. and it is good for the organisation because it
is important to link of each department like marketing and sales department. Sales department
makes profit for the organisation and if marketing department inform sales department about their
policy and structure than it is easy to ale in the target market for the sales team and also production
team includes in it. interlink of these three department is good condition because amazon is online
selling company any it has a big market and very popular. In it marketing department plays role in
advertisement and promoting the brand and they use video campaign and short term videos for the

marketing of its retail chain and if marketing department tell the other department about their
policies then sales department follow the policies and target the market or also tell the production
department to more sales and product quantity(Virglerová, Dobeš and Vojtovič,2016).
LO3
P4 positive and negative impacts the macro environment has upon business operations
Political factor
positive -Amazon relies on government support to implement, distribute, and profit of its
products. This leaves the company free from facing any critical political danger as its operations are
supported by the government itself.
negative-The company has said to be come under fire from federal trade commission in U.S.
For producing misleading claims about pricing discounts on around 1000 products.
economical
positive- Higher disposable incomes are allowing people to spend more frivolously on
luxurious items and entertainment, which are plenty on Amazon.
negative-China being one of the largest markets for amazon, the company is facing major
threats to its business from the ongoing recession in China.
Social
positive- The company's expansion into the grocery industry have enabled the customers to
receive groceries to their doorstep within hours which has creates a big social change globally.
negative- It creates bad habits to the customers in term of online shopping and sometime it
provides bad quality products so it is harmful for population.
Technological
positive- With advanced internet availability, consumers today have access to faster and affordable
internet. This is making amazon more popular since the consumer's internet relates directly to their
ability to shop online.
negative- The company faces the threat of rapid technological obsolescence which pressurizes it to
continuously develop its technological assets.
Environmental
positive- With its offer of cloud storage and cloud computing the company have eliminated

the need for hardware and storage devices for public.
negative- Until 2016, the company has not published a sustainability report discussing about
the environmental impact that the organisation is causing globally(Bah and Fang,2015). This
question is one more factor that governments are considering before putting amazon in their
nations.
Legal
Positive - Ii impact on the organisation in positive way such as many of legal activities and
laws. Safety and protection law and employment law and law also against fraud.
negative- The company has said to be come under fire from federal trade commission in
U.S. For producing misleading claims about pricing discounts on around 1000 products.
LO4
P5 Internal and external analysis of specific organisations in order to identify strengths and
weaknesses.
SWOT Analysis of Amazon
Strengths Weaknesses Opportunities Threats
E-Commerce leadership
Significant cloud player
Customer base and
loyalty
Worldwide presence
Large range of products
Strong financials
Focus on innovation
Weak operating
margins
Product failures
Diversification
Forward integration
Acquiring new businesses
Releasing new products
Heavy competition
Regulatory threats
Strong dollar
Porter 5 forces Analysis
 Threat of substitute products and services – Products sold by amazon are also available in
other places and stores. Gadgets such as mobile phones are sold in retail stores and also by
their official stores creates a hindrance for amazon to entirely govern the mobile and other
related sectors digitally(Bah and Fang,2015).
 The Threat of the entry of new competitors - The threats of substitute for amazon is high.
Like other sectors, e-commerce websites have also grown in the past decade. Indian
websites such as Flipkart, Snapdeal, Shopclues etc. are real big competitors of amazon.

They provide a wide range of products challenging the Amazon's services. Also, few of
these portals have also managed to open their retail stores which are attracting customers to
the stores and the websites as well. This competition is a major threat for Amazon to manage
its presence and position in big countries like India.
 Intensity of competition – Few strong forces such as high aggressiveness of firms, high
availability of substitutes, low switching costs are the major factors of market
competitiveness.
 Bargaining Power of Amazon’s Customers/Buyers – Consumers having access to high
quality information of the services of online retailers and their customers. This leads the
consumers to find alternatives to find their products. Also, the low switching costs makes it
easy for consumers to shift from amazon to other portals such as Flipkart.
 Bargaining Power of Amazon's suppliers – By increasing their profit margins the supplier
commodity can directly affect the company's online retail operational costs.
Based on this Five Forces Analysis for Amazon it can be seen as the company's major threats are its
strong competitors. The rising market of e-commerce portals have grown different e-commerce
websites too, which are leading towards the downfall of Amazon's place in the market.
P6 Strength and weakness interrelate with the external factors
Some of strength and weakness interrelate with macro factors. Technological factors which
relates with price strategy that amazon can use their money and efforts to make a new technology
and invest on this thing can expand the business of amazon because technology is liked by the
people and it is the strength of the company. Social factor which relates with the weakness of the
company and weakness is failure of product. Duplicate product is given by them to the customers
and they worth like original products(Bah and Fang,2015). Amazon has to work upon it to reduce
the bad thinking of the people regarding the product.
CONCLUSION
From the above study it has been summarised that different type of organisation were
worked with their different legal structure With its growing leadership in the market, amazon still
lacks few things that needs to be considered while operating globally. Above factors discusses the
company business impacts effecting the firm while continuing its leadership in the market.

REFERENCES
Books and journals
Bah, E.H. and Fang, L., 2015. Impact of the business environment on output and
productivity in Africa. Journal of Development Economics.11.pp.159-171.
Virglerová, Z., Dobeš, K. and Vojtovič, S., 2016. The perception of the state’s influence on
its business environment in the SMEs from Czech Republic. Administratie si Management Public.
Belás, J., Bartoš, P., Habánik, J. and Novák, P., 2014. Significant attributes of the business
environment in small and meduim-sized enterprises. Economics and Sociology.
Clarke, G., Li, Y. and Xu, L.C., 2016. Business environment, economic agglomeration and
job creation around the world. Applied Economics.48(33). pp.3088-3103.