BUS300: Business Environment Analysis Report - Primark Case Study

This report provides a comprehensive analysis of Primark's business environment, examining various aspects of the company's operations. The report begins by identifying Primark as a private limited company and explores its purpose, which is to generate profit through the retail of goods. It then delves into how Primark meets the objectives of its stakeholders, including suppliers, customers, employees, and the government, highlighting the importance of each group. The report further discusses Primark's responsibilities, such as legal and ethical considerations, and outlines strategies for fulfilling these responsibilities, including adapting to market research and employee relations. The report examines the impact of fiscal and monetary policies, and international trade on the UK business environment. It provides insights into different economic systems, including those in China, the UK, and Cuba, and their impact on Primark. The report also covers market structures, competition policies, and the influence of cultural environments on Primark's behavior, as well as the significance of international trade and EU policies. This report offers a detailed understanding of the factors influencing Primark's success within the broader business environment.

BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION..........................................................................................................................................................1
TASK 1...........................................................................................................................................................................1
1.1Identifying the type of organisation and its purpose ...........................................................................................1
1.2Extent through which Primark meets the objectives of their stakeholder............................................................2
1.3The responsibilities of Primark as a company and different strategies are introduced for meeting them ..........3
TASK 2...........................................................................................................................................................................4
2.1Different types of economic system in following countries.................................................................................4
2.2Assess the impact of fiscal and monetary policy..................................................................................................5
2.3Different competition policy and other regulatory mechanism in UK................................................................5
TASK 3...........................................................................................................................................................................6
3.1How pricing and output decisions of businesses is determined in different structure of market.........................6
3.2Ways in which market forces shape organisational responses.............................................................................7
3.3How business and cultural environment shape the behaviour of Primark...........................................................8
TASK 4...........................................................................................................................................................................9
4.1Singnificance of international trade to UK business organisation.......................................................................9
4.2The impact of global factors in UK business organisation.................................................................................10
4.3Impact of policies of EU on UK business organisation.....................................................................................11
CONCLUSION.............................................................................................................................................................11
REFERENCES..............................................................................................................................................................12

INTRODUCTION
Business environment can be defined as all of the internal and external factors which
affects the functioning of employees, management and customers. Through this study,
management recognises the needs of employees which helps them to increase the satisfaction
level of customers. The environment of business is total of different types of conditions as well
as the events which can affects the business to a greater extent. Present report is based on the
case study of Primark which is a subsidiary firm of Associated British Foods and it was launched
in the year 1969 in Ireland (Al-Debei and Avison, 2010). Further, they opened 100 stores from
the year 2000 in Ireland and Britain. In this report, it also covers the purpose and how the
company meet the objectives of their different stakeholders. It also involves the different
decisions of pricing along with output that are identified by the business. Moreover, this report
shows the importance of international trade to the business organisation of UK along with the
impact different policies of EU on UK business.
TASK 1
1.1Identifying the type of organisation and its purpose
There are different types of firms in order to evaluate the working of the business and
their purposes are mentioned below:
Charity- This is considered as non-profit organisation as their main motive is to provide services
for the welfare of public. For example, in UK Cancer Research which organises different types
of events and also collect donations which is used for the treatments of cancer patients. Thus, the
major objective of the company is to provide appropriate facilities to patients and to make
innovations in order to provide services.
Cooperative- This type of business is managed by their own persons. For example, Daily bread
is a company that delivering products as wholesale prices and leads to reduction in the
exploitation of their various number of customers (Bøllingtoft, 2012).
Private Limited company- Primark is a subsidiary firm and considered as public limited
enterprise in retail of Associated British Foods group and they are engaged in dealing with wide
range of goods and services. The main of company is earn high level of profit. In order to
achieve targets they are required to formulate different strategies which helps them top compete

in marketplace. Private companies mainly focuses is to provide appropriate quality of products
and services as per the demand of customers.
Public Limited company – This type of business is controlled by the government and their main
objective is to concentrate on the demand and requirement of public. For example, Tesco which
is public company and their major objective is to provide best quality of product at reasonable
prices to customers. The management of the company focuses on the quality of the products and
services which helps them to increase in the customer base (Botha, Kourie and Snyman, 2014).
1.2Extent through which Primark meets the objectives of their stakeholder
Stakeholders are those who have stake directly or indirectly within the organisation. They
plays an important role in Primark in order to achieve different goals and objectives. There are
some of the stakeholder of Primark which plays essential role such as suppliers, customers,
employees, government for attaining the objectives. There are certain objectives of stakeholder
and Primark concentrating on to meet all of them in an appropriate manner. Suppliers- This is one of essential stakeholder which provides appropriate products and
accessories to the company. The stated business in not engaged in manufacturing their
own products. Mainly the suppliers meet the demands and needs of customers by
providing them quality products for increasing the volume of sales (Brannon, 2010). The
major objective of suppliers of Primark is to offer quality products to the the company for
satisfying the requirements. Customers-This is considered as another main stakeholder of Primarkas they deliver
products as per their requirement along with the reasonable prices. In order to achieve
objectives the company is required to have knowledge of different types of demands and
requirement of customers. They are considered as key of the organisation as without they
will not be able to attain objectives. Government- Government also plays an important role in the functioning of the business.
In this, the government keep appropriate track on that whether the company is carry out
the CSR activities or not. For this, it is important for the business to to manage all of its
responsibilities with respect to government for satisfying them.

 Employees- They are another stakeholders of company who provides appropriate quality
of services within the different stores. The major objectives of company is to provide
appropriate incentives along with the satisfactory wages which encourages them to
perform in a well defined manner. Furthermore, it is important to involve them in the
process of decision making as consider their ideas as well as opinions (Budhwar and
Debrah, 2013).
1.3The responsibilities of Primark as a company and different strategies are introduced for
meeting them
It has been analysed that there are different types of responsibilities of Primark which
helps in order to make effective strategies and plans for achieving the goals and objectives of
their stakeholders. The major responsibilities of primark mainly involves such as legal
responsibilities. The main focus of company is on to review the legislation of customers and
delivering ethical services as per the requirement of them. There is requirement to employ some
of the different strategies with respect to prices of products which helps in dealing with their
customers in ethical way.
In addition to this, another main responsibility of Primark is to manage the review of
employment legislation so that they can provide appropriate environment to the employees as per
their needs. In order to meet the responsibility they are required to support employees which
helps in delivering appropriate quality of services to customers in an effective manner (Carroll
and Shabana, 2010). Furthermore, the company also make structure of salary of employees for
meeting the objectives of company. On the other side, through health and safety legislation the
company required to assess the risk of the employees as well as the customers. It is important to
take corrective measures related to health and safety of people with the help of proper planning
and controlling on different activities.
Apart from this, determine the interest of stakeholder is also an important aspect and
responsibility of Primark. There are certain stakeholder who have high level of interest in firm so
that they have to fulfil it in appropriate way and provide them suitable rate of return. The
company also give benefits in terms of financial as well as non-financial.
Moreover, one of the major responsibility of Primark is to ensure there is no
discrimination is done among the employees at workplace at any level of the company. The

stated organisation is needed to develop proper policies of working along with the code of
conduct. It can be stated that they have to consider that they provide appropriate quality of
services as per the requirement and needs of customers (Cavusgil and et.al., 2014). For this, they
are required to carry out market research which helps in analysing the demands and needs of
customers for a specific period of time. Thus, it can be stated that all of the activities are required
to carry out in an effective manner.
TASK 2
2.1Different types of economic system in following countries
There are various forms of economic system which mainly focuses on the certain
activities with reference to resource allocation along with the distribution of various services
within the department. There are some of the different types of economic system in given
countries :
China- This is one of the leading country which have socialist economy in which all of the
activities are done by the leaders for the purpose of creating economic system. In addition to this,
there is an important role played by Chinese government for allocating different sources of
various countries which helps in operating the economy. In this, all of the power and authorities
are given to the Chinese government and they plan all of the activities (Commander and Svejnar,
2011). The major benefit of this economy is that it helps in the development and growth of the
economy and power is with the central government.
UK- In UK, there is mixed economy in which the authority to take their own decisions is given
to both private owner as well as the government. In mixed economy, the different decisions are
taken by the regulatory authorities and private companies with respect to the allocation of the
products which is carried out by them. One of the most important benefit of mixed economy as it
does not carry out the activities regarding inequalities among the workers and their major
objectives is to enhancement in the growth of economy.
Cuba- In Cuba, there is planned economy which is mainly conquered by the enterprise of state.
This type of economy is managed by the government and all of the important decisions with
respect to distribution along with the allocation of the products and services in marketplace.
Apart from this, the major focus of planned economy is to implement different rules and
regulation among the different states (Craig and Campbell, 2012).

2.2Assess the impact of fiscal and monetary policy
There is an important role played by Bank of England and Chancellor of Exchequer of
UK for regulating the economy in an effective manner. There are mainly two various policies
which are regulated in the economy such as fiscal and monetary policy by both regulatory firms.
Fiscal policy can be termed as a technique which mainly focuses in assessing the activities of
spending and taxation of central government. On the contrary of this, monetary policy includes
the management of rate of interest and cash supply in economy through central bank.
Furthermore, the tools which mainly affects in UK which includes the housing sector and
farming. There is an important role played by both of the policies which are described below:
Housing- This field is highly impacted due to the fiscal and monetary policy which is developed
by government. For example, fiscal policy shows the taxation and spending of government due
to the development of the economy so that regulatory authorities cut down the rate of taxes and
maximise the spending (De Jonge, 2011). On the other side, if there is decrease in the economy
so that it is required to increase in the rate of taxation and make reduction in the spendings.
Therefore, at the time of recession at the government of UK so that they decrease the rate of
their rate of taxes and maximise in the spending power on infrastructure for enhancement in the
living.
Farming- There is positive impact on the monetary policy in the field of agriculture. If there is
increase in the rate of interest it helps the reserve banks so that they can spend more on farming.
With the help of this, the government increases in the materials for providing subsidy to the
farmers so that they can easily harvest in farms. Thus, it has been analysed that due to the
increase in the rate of interest it helps the government to give more spending on an individual
(Doh, Luthans and Slocum, 2016).
2.3Different competition policy and other regulatory mechanism in UK
There are different types of policies are made for the purpose of maintaining the level of
competition in market in the industries. Through competition it helps to encourage and make
enhancement in the level of work efficiently. There are certain policies are introduced by the
UK government due to the increase in the level of competition. Different policies and their
influence on Primark are mentioned below:

Competition policy 1998- This policy is related to the framework in context of restrictions
which are imposed by the government on the different practices of the company in marketplace.
Through this act, there is fair competition and to create awareness among the people reagarding
to face the problems in the different functioning and the investigation is made by the
government.
Training and skills policy – With the help of this policy which is made by the UK government
for providing appropriate enhancement in the level of skills through different programmes of
training which is given to employees. This assists them to develop innovations of the different
types of products and services which is carried out by them in effective manner (Granger. and
Schroeder, 2013).
Enterprise act 2002- With the help of this act it supports in restricting other companies which
are involved in the anti-competition practices. By preparing accounts along with the
documentation as it can be done with the help of this act at the stated organisation.
Industrial policy- Through this policy government ensure the growth and development of the
activities of manufacturing and the different sectors of the country which are regulated under UK
government.
Role of sector regulators- There are different competitive policies including Ofgem which make
appropriate investigation in order to regulate the policies. Thus, it helps to control the prices of
products in market and to provide standard types of services to the various other clients.
TASK 3
3.1How pricing and output decisions of businesses is determined in different structure of market
There are some of the market structure which are exists in economy which helps the
companies in order to perform and execute the services in an appropriate manner. Market
structure refers to that in which there are different sellers who offers wide range of products and
services to the different number of buyers. Different market structure are mentioned below:
Perfect Competition- In this type of market there are various number of buyers and sellers
which are exist in market as they deals in homogeneous goods in marketplace (Hamilton and
Webster, 2015). Apart from this, the major focus of organisation is on to assess the demand and
supply of the different products and decide the prices of those services. In this market, the

pricing and decisions of output mainly consider by the company in the perfect competition
market.
Monopoly-This is considered as another type of market structure where all of the control and
there is dominance in market by a single seller. Therefore, on single seller sells product and all of
the people are tend buy from that seller in this type of market. At any prices they are ready to
buy due to their monopoly in marketplace. Furthermore, the decisions related to pricing and
output are taken by a single enterprise which are existing in market.
Oligopoly- This is considered as another structure of market where there are huge number of
sellers present in market and sells same goods. Furthermore, they also sell their products at same
prices and it depends on customers as what they prefers. In context of this, all of the decisions
related to the pricing and output are taken according to the demand and supply of the products in
the different customers (Klapper, Lewin and Delgado, 2011).
Duopoly- In this type of market structure where there are two suppliers who have control over
the marketplace. Therefore, all of the decisions are taken in context of production as well as
output taken by the organisation which are operating in duopoly market.
3.2Ways in which market forces shape organisational responses
There are various market forces in the market which can have impact on the organisation
and on the decisions related to development. Some major forces that make the appropriate
responses of Primark that is mentioned below:

Source :( Demand and supply curve )
Demand and Supply- Demand can be defined as the principle which helps to identify the
willingness as well as desire of a person in order to pay the prices of products at a given period
of time keeping other factors constant. If in case there is increase in the prices of products so
that the demand of products will decreases and vice- versa. The company also increases the level
of production that helps to give more output and if there is less output them less production.
In addition to this, supply can be termed as the concept which helps in understanding the amount
of different products and services to customer and provide them as per the requirement. The
stated firm to make the decisions after considering the supply of products and it can be done with
the help of market research and also helps to gain competitive advantages in marketplace (Kolk,
2016).
Perception of different customers- After carried out appropriate research by Primark in order to
know the perception of the various number of customers so that it helps in taking proper action
after the study of behaviour of customers.
3.3How business and cultural environment shape the behaviour of Primark
It has been analysed that the cultural environment and business in the existing
environment influences and also provides shape for the behaviour of organisation. Some of the
key business and cultural environment involves:
Illustration 1: Demand and Supply curve

Social environment- Through effective cultural environment as it provide shapes to the
behaviour of Primark which involve the social environment which includes the preference and
taste of consumers along with the changes in the income of people which provides shape to the
behaviour and different types of activities of the Primark. For example, due to the changes in the
preferences of customers so that they are required to make modifications in the products and
services in order to meet the changes in the demand of customers. Due to the changes in the
demand if there are some of the changes made by the Primark in the different activities so that it
helps to enhancement in the profitability ratio of the company (McCarthy, 2013).
Technological environment-This is considered as another business environment which provides
shape in the behaviour of the Primark which involves the different technological factors which
gives outcomes in selling the fashionable products. By implementation of different technological
factors that directly supports for enhancement in the image of the products in the market.
TASK 4
4.1Singnificance of international trade to UK business organisation
International trade can be termed as the exchange of different types of services, products
along with the capital on territories. It includes the transaction of buying and selling among two
and more than two countries for the purpose of developing the economy. With the help of
globalization the international trade can be carried out without the companies by getting limited
number of products and services which are produced in the different regions. Furthermore, it is
costly as compared to the domestic trade which includes cost of tariffs along with the legal taxes.
It also includes the cost of labour and capital that is high and it is not offered by the company so
that they can import and export their material outside the market (Sinay, 2014). International
trade is important and profitable as there is no chances for producing the products in domestic
market. There are various benefits of international trade to Primark as mentioned below:
Economy- Through international trade in enterprise at UK it helps to increase the GDP and to
generate the level of revenue. Furthermore, it also assists in order to increase the profitability so
that they can easily enter the international market for earning high level of revenue for the
purpose of surviving for a long period in marketplace.
Production cost- There are some of the losses are bear by the company due to the less cost of
production and this is due to the maximisation in the production volume and it can be done with

the help of international trading (Solomon, 2014). There are different types of raw materials
which are imported by the company at lower prices and they also produce the appropriate
products and sell them in market. There are less number of finished products and as there is
requirement of cost for the small business. There are various number of opportunities are given
to employees after going outside the country which enhances the scope of learning.
Broadens the market and horizons-The production of UK based organisation as they produce
for domestic use and it leads to decrease in the potentials. Through international trading they
export their different types of products and services to several areas for the purpose of generating
revenue. Thus, it will assists in order to gain proper reputation in the international market of the
organisation (Welford, 2013).
Thus, it helps Primark for trading in different countries for the purpose of remain high in
revenue and to manage the scale of economy. As if there is an option of leaving EU or Brexit by
UK so that it will impact on the relation with respect to trade among the EU and UK. There is an
advantages to company as there are proper relations with EU. There is also elimination of tariff
and non-tariff as the prices are also high of the products and services of Brexit.
4.2The impact of global factors in UK business organisation
For the purpose of sustaining in the global marketplace, Primark faces some of the global
factors which can influence the organisation in a negative or positive aspects. The impacts of
different factors on the activities and the level of performance of Primark which involves:
Political factor- The major factor involves the political factor which have direct impact on the
the different activities of the business organisation in UK at international marketplace. There are
different types of policies are developed by the company as per their parent company so that it
can negatively affects the performance of Primark. For example, in UK the companies take
service tax at the time of purchasing of apparels. On the other side, in different regions they do
not take service tax from the customers (Wetherly and Otter, 2014).
Economical factor- This is considered as another factor which have direct effect on the
performance of Primark. For example, at UK the conditions are not stable which helps customers
in order to purchase appropriate quality of products. On the other side, if other economy is not
developed in the region so that Primark must required to set the prices as per the requirement of