Comprehensive Business Environment Analysis Report: Sainsbury Plc

This report provides a comprehensive analysis of the business environment, focusing on Sainsbury Plc. It begins by differentiating between profit and non-profit organizations, followed by an examination of micro, small, and medium-sized businesses, their objectives, and legal structures. The report then delves into the size and scope of organizations, including market shares and growth strategies. It explores global business models like franchising and joint ventures, industrial structures, and market forces. The analysis extends to the internal functions of marketing, finance, human resource management, and operations, illustrating their interrelationships. It further investigates microenvironmental factors and their impact, including the transformational processes within the organization. Finally, the report applies SWOT and TOWS analyses to assist in strategic decision-making, concluding with a summary of key findings and recommendations for Sainsbury Plc's continued success in the competitive UK market.

Unit 1: Business & the Business
Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................3
Difference between profits and non- profits organizations..........................................................3
Micro, small and medium-sized business with the different business objectives, supply of
goods and services and their purpose...........................................................................................3
Legal structure associated with the forms of business.................................................................4
Difference between large, medium and small size organizations including their market shares,
objectives and goals and growth..................................................................................................5
Global growth and development of International, transactional and global organizations.........5
Difference between franchising, joint venture and licensing.......................................................6
Industrial structure and competitive analysis...............................................................................6
Market forces and economic operations......................................................................................6
Responsibility of organization to meet the stakeholders interest and expectation......................6
LO2..................................................................................................................................................7
The role of marketing, finance, human resource management and operations within the
organisation..................................................................................................................................7
Organisation mission and objectives are met by different functions...........................................7
Different structures the organization...........................................................................................8
Organisation structures and the complexities on organisations...................................................8
LO3..................................................................................................................................................9
Micro environmental factors and its impact on organisation negativity and positively..............9
How the organisation Go thorough the transformational process and overcome the resistance
in response to changing market environment............................................................................10
LO4................................................................................................................................................10
SWOT and Tows analyses and how they assist in decision making.........................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
The term business environment consist of internal and external factors that has huge
impact on the performance of the company . Internal factors can affect the owners, management,
clients and external factors can include the social trends, technology trends , political; Etc.
This report will cover the study of Sainsbury Plc which is second largest supermarket in
the United kingdom with the global presence. They are having around 16 percent of the shares in
retail industry of the UK. Product sell by the Sainsbury are related to the Hypermarket, for-count
shops, supermarket etc.
This report will explain the different scope, size and types of organization. It will
demonstrate the interrelationship between the various functions within the organization and how
they are interlinked with each other. This report will use the contemporary examples and
demonstrate both positive and negative influence of macro environmental factors. In the end of
this report will determine the internal strength and weakness of the specific business and explain
their interrelationship with the external macro factors.
LO1
Difference between profits and non- profits organizations
Their are two type of organization, one whop work to earn profits by selling the product
and services to the customers that can add value in their life, it covers private organizations and
public private organization. Sainsbury is also profits earning organizations who develop
products and services to satisfy the customers need and add value in the customers life and their
first priority is to earn profits in their business for their expansion.
One the other side Non- profits earning organizations are types of organization who work
toward the society welfare without earning profits. They provide free services and helps top the
people general public like helping the poor people with food, take donation for helping poor
people and people who are facing health related problems and cannot effort the treatment
(Belyaeva., 2018). NGO's are the best examples of Non- profitable business. NGO's can be
privately owned and also can be government owned.
Micro, small and medium-sized business with the different business objectives, supply of goods
and services and their purpose
Micro business

Micro business is the types of small business where less than 10 employees work, and
they earn less than $250000 per year. Their main purpose is earn limited profits run their home.
They sell general product and services locally and their objectives to earn profits and satisfy
customers needs.
Small business
Small business are privately owned business or it can also be sole proprietorship and
partnership business. Small business size depends on the industry by industry but generally they
can have less than 500 employees and 7.5 million of annual revenue. Purpose and objectives of
small business is to earn profitability and expand their business more.
Medium business
Medium sized business can be defined within the Companies Act 2006 as a business with
up to 250 employees. They may be family-owned and managed businesses but, by virtue of their
size, they may also be complex entities where ownership is separated from management. Purpose
and objectives of the medium-sized business is to develop product and services to meet
customers needs and earn profitability.
Legal structure associated with the forms of business
Sole traders
A sole traders are the private business owners, the businessman have to registers
themselves as the sole trader. A sole trader is the owner of the business, so they alone start their
business with their own capital and shares all the profits and losses of the business.
Partnership business
Partnership is the legal form between the two or more than two business partners, who
sign the partnership form to start business together, all the partners equally put the capital and
share equal profits and looses of the business (Brotspies and Weinstein., 2019).
Private limited company
Private limited company can be both public and the private company, Unlike a publicly
limited company, where shares are traded on the stock exchange, a private limited company does
not publicly trade shares and is limited to a maximum of 50 shareholders.
Size and Scope of organization

Difference between large, medium and small size organizations including their market shares,
objectives and goals and growth
All the organisation have different size, market shares and goals and objectives. And here
are difference between large, small; and medium organizations-
large organizations
Large organizations and national and multinational organization who can have the more
than 1000 employees and less than 500 personal computers. Market shares of the large
companies are higher campretevly the small and medium size companies. Their main goals is to
expand their business rapidly and open new branches. They continuously make strategies and
innovate their products to grow their business on the national and international level.
Medium-sized Businesses
Medium sized business can be defined within the Companies Act 2006 as a business with
up to 250 employees. They may be family-owned and managed businesses but, by virtue of their
size, they may also be complex entities where ownership is separated from management. Their
meerkat shares are limited within the local country or states (Conboy, Dennehy and O'Connor.,
2020). Their main objectives is to produce products and service's to satisfy their customers and
profit earning is main objective.
Small sized organizations
. Small business size depends on the industry by industry but generally they can have less
than 500 employees and 7.5 million of annual revenue. Goals and objectives of small business is
to earn profitability and expand their business more. Market shares of small business are limited
to local area, but they can expand their business to medium and large. Some of the small
organizations grow rapidly and some of them take time.
Global growth and development of International, transactional and global organizations
International business
International business have more competition, higher growth and bigger opportunities for
the business. Sainsbury is also operating their business on the international level where they
have more numbers of competitors and business opportunities as compare to the domestic
business.
Transactional

A transactional business are the enterprises that include the international production of
the services and goods, investment in the foreign or the investment management in one or more
countries. Interactional business are growing rapidly and contribution toward the economy of the
country.
Global organizations
an international alliance involving many different countries. International organization,
international organization, world organization, world organization.
Difference between franchising, joint venture and licensing
Franchising
franchising the method of distributing product and services involving the franchiser, who
established the brand's trade mark or the trade name and the business system and the franchisee
who pays the royalty and other charges with using the name and system of the franchiser.
Joint venture
A joint venture is also an business in which two and more than two organizations enter
the market with new business together (Gavurova.,and et.al., 2017). They have common goals
and objectives. Both organization put equal capital and share losses together.
Licensing
Licensing is also an market entry method in which company take the permit to operate
their business internationally and sell their services internationally.
Industrial structure and competitive analysis
There are various competitive analysis that are useful to understand the industrial
stricture and competition within the industry. Porter's five is one of them that include,
competition within market, suppliers powers, customers power, entry barriers and substation of
products.
Market forces and economic operations
supply and demand
Supply and demand within the market where Sainsbury is operating their business is
higher. Sainsbury can able to supply the product according to the demand by the customers.
Responsibility of organization to meet the stakeholders interest and expectation
Investors and shareholders of the Sainsbury are most important part because they
provide required capital to the business and by using the funds company run their operations.

Leaders and manager of the company should ensure that investors and stakeholder are getting the
interest ion their investment, so they can be happy with the investment and keep investing for the
Sainsbury.
LO2
The role of marketing, finance, human resource management and operations within the
organisation
The main role of marketing in Sainsbury is to provide the company with the best product
in the market with unique features that differ them from other products in the market. Find a
place for the company that best suits to meet the target of getting the maximum number of the
customer. The price of the product is considered to set low in comparison to the other companies.
The promotion includes the spreading the information about the product and the prices, along
with the additional services that are provided.
The main role of finance is to set the amount of fund that is needed and plan to get the
required funds for the company. The human resource management (HRM) provide the company
with the solutions regarding the employees, policies as well as the procedures. The role of
operation managers is to manage the production lines of the goods and check the design,quality
and supply chain of the products.
Sainsbury, check the interrelationships between the marketing, HRM, operations and the
finance. By setting up the strategies by HRM to increase the sales and improving the product
quality, keeping the funds in check and checking up the unique quality of the product by creating
different designs. The sales and the customers are increased by the marketing strategies.
Organisation mission and objectives are met by different functions
Sainsbury is a supermarket in UK that provide the customer with groceries ,clothing,
electronics and homewares. The main objective of the company is to provide the customers with
everything they need at one place and meet their changing needs. The company is set at a place
where the customers can reach easily and find the products of great quality without expanding
much money. The human resource management keep in check the trends and the preferences of
the customer to bring the best products to the costumers and meet their needs. To introduce the
new products or any plans is funded and controlled by the finance of the company. The products
of the company needs to be of specific quality and that differentiate it from the other products in

the market and improves the sales. This can also be used as an advantage over the other
company's in the market and create a competing environment.
Different structures the organization
Sainsbury is a very huge organization that require a very accurate management for the
functioning.
In bureaucratic structure
The company is very strict about the rules and specifies the work that needs to be done by whom,
this eliminates confusion in the organization and promotes productivity.
In post-bureaucratic structure
The company function according to the standard set of procedures, the decisions are made by
discussing it with the employees that keeps them encouraged.
Functional organized structure
It is used by the Sainsbury, in this structure the organisation is divide into various department
like sales, marketing, finance and HR. These departments have people with same set of skills that
improves the efficiency of the company.
In matrix structure
The functional and the projected structures both are used in this structure. Vertical and the
horizontal commands work in the organization for the functioning.
Strategic business unit
It is a part of the company but work with its own vision as well as its own direction. This unit of
the company works separately but is important of the company.
Parent company
The company holds the interest of the other companies as well as function on its own. The
subsidiary company's interests depend upon the managerial control.
The chosen organization can follow the bureaucratic organizational structure as it is for
the functioning of the huge and complex operations. The rules and regulations there can help the
chosen organization to perform with more efficiency and provide with better profitability.
Organisation structures and the complexities on organisations
International organizational structure
The international business structure set all the process of the organisation right. They adopt
different types of structures according to the needs and requirements. In accordance to the

functions of the organization the international division structure is created. This structure helps
the organisation to get the knowledge of the foreign market. The complexities faced by the
international organization structure are: separate managers are set locally to deal with their part
of the internation deals and the assigning of the resource globally is very difficult.
Global organizational structures
In this the company's operations are related to the overseas countries that require necessary
integration of the activities. Considering all the crucial facts the global organisation structure is
formed. The complexities related to global organizational structure are: the parent companies
have to decide the extent of control over the subsidiaries and the decision that are made by the
parent company also have to decide the extent of governance over the subsidiaries.
Transnational organisational structures
This organisation structure is formed by keeping various dimensions of business in consideration
like geographic, product, as well as functional levels. The organization have to create the
integration in the different geographic areas or function or different product categories.
The complexities related to the transnational structures are: the investment is more considered to
the workforce, there are very poor work condition in some parts and the profits made by the
company is given to the parent companies over the seas and the locals are not profited.
LO3
Micro environmental factors and its impact on organisation negativity and positively
PESTEL Analysis
Political factors
Sainsbury is operating their business international which means that they are exposed
with the various political environment. Corrupted political parties demand for the funds so
company can operate their business continuously that has negative impact for the Sainsbury. On
the other side having good relationship with the political parties also creative opportunities for
the Sainsbury to expand their business more.
Economical factors
Economical factors like Brexit impact the Sainsbury negatively because after the Brexit
taxes from the EU countries increase that makes their product and services more expensive. On
the other side decrease in the prices of raw material affect the business of Sainsbury positively
because they are able to provide their product in lower prices.

Social factors
Trends in the customers change with the times, following the old trend that are not
considers by the people can have negative impact on the Sainsbury and customers can deny
buying product but keep following the social trends by the Sainsbury can provide trust from the
customers, and they can take competitive advantages (Głodowska., 2017).
Technology
Sainsbury is taking the advantages of the technology and creating good experience for the
customers and growing their business continuously. It is necessary for the Sainsbury to follow
the new trends to continuously take competitive advantages. Otherwise it can have negative
impact and other organizations can overtake them.
Environment
Most of the product sell by the Sainsbury are eco friendly that is helping them to create
good image in the customers mind, and they are getting g support from the government to sell
their product without any issues.
Legal
Sainsbury have all the licence, and they are paying taxes to each and every country. That
is helping them to keep their business run effectively.
How the organisation Go thorough the transformational process and overcome the resistance in
response to changing market environment
During the change in the external market environment that has huge impact on the
operations of the Sainsbury organizations and it can also be change driver for the company. It is
necessary for the company (Khan, Çera and Nétek., 2019). Leaders and managers of the
company play important role in this process, and they use their communications skills for the
transformation process and overcome from the resistance to change in the market environment.
LO4
SWOT and Tows analyses and how they assist in decision making
SWOT
Strength
 From the small grocery stores which deal with the limited product and services.
Sainsbury has expanded their business to the supermarket that deals with various
merchandise.

 Employees are well-trained and they get training and development on the regular basis
that is helping the Sainsbury to achieve their goals.
Weakness
 grocery products sell by the Sainsbury provide them law margin and growing
competitive is forcing them to decrease their prices more (Kiseľáková., and et.al., 2019).
 Customers are switching the brand due to higher cost of product and services by
Sainsbury
Opportunities
 Expansion of the business in village areas can also be good opportunities because
villages are developing day by days.
 Online expansion of the business can helps Sainsbury to expand their business shares
more digitally.
Threat
 Higher competition in the market is creating threat upon the Sainsbury
TOWS Analysis
Opportunities
1) online growth
2) Expansion of business in
villages
Threat
1) Competition
Strength
1) Good market reputation
2 )Skilful workforce
SO
 Sainsbury can expand
their business online
and people will except
their product due to
good market
reputation.
ST
 skilful employees can
give ideas to innovate
product and company
can take competitive
advantages.

 Sainsbury can use
knowledge of skilful
employees in online
expansion.
Weakness
1) Brand switching
2) low margin product
WO
 Online business can
reduce the brand
switching.
 Law margined product
can be sell by
Sainsbury in the
villages and take
competitive
advantages.
WT
 provide discount and
offer to take
competitive
advantages.
 Creative good
relationship with
suppliers to increase
margin in products.
Sainsbury uses the SWOT analysis and TOWS analysis in the decision-making,
Sainsbury leaders use the SWOT to identify the weakness and opportunities, so they can convert
weakness into the opportunities and take advantages of the opportunities top make their business
more effective (Niemimaa., and et.al., 2019). Sainsbury use TOWS analysis to covert Strength
into opportunities. Strength to reduce threat, weakness into the opportunities and weakness to
reduce the threat and take decision accordingly.
CONCLUSION
This report has been explained the different scope, size and types of organization. It has
been demonstrate the interrelationship between the various functions within the organization and
how they are interlinked with each other. This report has been used the contemporary examples
and demonstrate both positive and negative influence of macro environmental factors. In the end
of this report has been determined the internal strength and weakness of the specific business and
explain their interrelationship with the external macro factors.

REFERENCES
Books and journal
Camilleri, 2018. Strategic planning and the marketing effectiveness audit. In Travel marketing,
tourism economics and the airline product (pp. 117-135). Springer, Cham.
Brewster, 2017. The integration of human resource management and corporate strategy. Policy
and practice in European human resource management. pp.22-35.
Turchin and et.al, 2018. Quantitative historical analysis uncovers a single dimension of
complexity that structures global variation in human social organization. Proceedings of
the National Academy of Sciences. 115(2). pp.E144-E151.
Abbas, M.W. and Ul Hassan, M., 2017. Moderating impact of environmental turbulence on
business innovation and business performance. Pakistan Journal of Commerce and
Social Sciences (PJCSS), 11(2), pp.576-596.'
Barr, T.L., Reid, J., Catska, P., Varona, G. and Rout, M., 2018. Development of indigenous
enterprise in a contemporary business environment–the Ngāi Tahu Ahikā
approach. Journal of Enterprising Communities: People and Places in the Global
Economy.
Belyaeva, Z., 2018. Business environment challenges and trends for contemporary SMEs in
Europe. In The sustainable marketing concept in European SMEs. Emerald Publishing
Limited.
Brotspies, H. and Weinstein, A., 2019. Rethinking business segmentation: A conceptual model
and strategic insights. Journal of Strategic Marketing.27(2). pp.164-176.
Conboy, K., Dennehy, D. and O'Connor, M., 2020. ‘Big time’: An examination of temporal
complexity and business value in analytics. Information & Management. 57(1).
p.103077.
Gavurova, B.,and et.al., 2017. Predictive potential and risks of selected bankruptcy prediction
models in the Slovak business environment. Journal of Business Economics and
Management.18(6). pp.1156-1173.
Głodowska, A., 2017. Business Environment and Economic Growth in the European Union
Countries: What Can Be Explained for the Convergence?. Entrepreneurial Business and
Economics Review.5(4). pp.189-204.
Khan, K. A., Çera, G. and Nétek, V., 2019. Perception of the selected business environment
aspects by service firms. Journal of Tourism and Services.10(19). pp.111-127.
Kiseľáková, D., and et.al., 2019. Competitiveness and its impact on sustainability, business
environment, and human development of EU (28) countries in terms of global multi-
criteria indices. Sustainability.11(12). p.3365.
Niemimaa, M., and et.al., 2019. Business continuity of business models: Evaluating the
resilience of business models for contingencies. International Journal of Information
Management.49. pp.208-216.