Comprehensive Business Environment Analysis of WALMART Operations

This report provides a comprehensive analysis of WALMART's business environment. It begins with an introduction to the concept of the business environment, differentiating between internal and external factors. The report then delves into various organizational types, including sole proprietorships, partnerships, and limited companies, highlighting their purposes and structures. It further examines the size and scope of different organizations, comparing WALMART with a smaller entity, Zaffirson Food. The analysis extends to the relationship between organizational functions, objectives, and structure, emphasizing the importance of alignment for effective operations. The core of the report involves a PESTLE analysis of the macro-environmental factors impacting WALMART, evaluating both positive and negative influences on its business operations. Additionally, an internal and external SWOT analysis is conducted to identify the company's strengths, weaknesses, opportunities, and threats, along with their interrelationship with external macro factors. The report concludes with a summary of findings and references.

Business Environment

Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different types and purposes of organisations; public, private and voluntary sectors and
legal..............................................................................................................................................1
Structures.....................................................................................................................................1
P2 Size and Scope of a range of different types of organisations...............................................2
TASK 2............................................................................................................................................4
P3 The relationship between different organisational functions and their linkages to................4
Organisational objectives and structure.......................................................................................4
TASK 3............................................................................................................................................5
P4 Positive and Negative Impact of various macro environmental factors on the......................5
Business operations of WALMART...........................................................................................5
TASK 4............................................................................................................................................8
P5 Internal and external analysis of WALMART in order to identify strengths and weaknesses
.....................................................................................................................................................8
P6 Strengths and Weaknesses interrelationship with external macro factors..............................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment is a very crucial aspect of any business and organisation around
the world. A business environment consists of internal environment as well as external. But both
of these environments a dynamic in nature and therefore continues evaluation of both shut
Dayton in and if active and officiant, so that the business can we efficiently run and the various
factors that are within these environments and influence of those on business activities of the
company can be ascertained. WALMART is an American multinational retail store which has its
retail outlets in different parts of the world. It was founded in 1962 and now has covered 28
countries (Beaty and Naik, International Business Machines Corp, 2015). It is earning maximum
revenues and is a part of private sector. The following report will talk about tools to analyse the
various factors of the environments, these include PESTLE analysis for external environment
and SWOT analysis for internal environment.
TASK 1
P1 Different types and purposes of organisations; public, private and voluntary sectors and legal
Structures.
There are different types of organisations. These types are defined on the basis of their
structure and also on the basis of their purposes. The role of people within these organisation
changes based on the structure of the organisation for e.g., a role of manager would not be that
much in a corporate structure but the same manager will play a vital role in the working of a sole
proprietorship. The different types of organisations and their purposes are discussed below:
 Sole Proprietorships: These are those organisations which are owned and operated by a
private individual with no sharing of profit and resources of the company. This kind of
structure is suitable for those individuals who do have enough money to spend and also
does not want to take much risk (Bobek, Rohadia and Sternad, 2016). The growth of such
companies is also restricted as the resources are not quite high enough to compete with
big companies. The main purpose behind this type of organisation is to supplement
family income or to manage the family through income of the business, as the income is
not that large from such kind of business that it can be applied in the business again to
grow and prosper, especially when there is other commitments of an individual also.
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 Partnership Organisations: A partnership is a mutual agreement between two people to
come together and do business; it is usually created for the purpose of making profits and
increasing the overall growth of business. The liability of a partnership is usually
unlimited and therefore partner’s personal assets can be put to stake if a partnership goes
bankrupt or unable to pay its dues. The purpose of such kind of partnership is to expand
the resources by coming together and also share knowledge and expertise of each other to
make business grow over period of time. The ultimate aim is to supplement family
income and earn enough to put back in the organisation make it grow.
 Limited organisation or company: Under this type of organisation, the liability of the
owners is restricted to the face value of shares held and they cannot be forced to sell their
personal assets in case of default of the company to pay its dues. WALMART comes
under this type of organisation. A limited company has the scope to grow large as it can
manage a large number of resources. There is a divorce between owners and management
and Board of directors of the company own proper management of company in an
effective as well as efficient way. The main purpose of this kind of organisation is to
grow business and increase the overall profitability of the company at the same time
ensuring that customer satisfaction is achieved and a value creation to the society has
been done effectively. It is managed and owned by a number of individuals and therefore,
the objective of the company is quite wide and narrowed like other organisations such as
partnerships and sole trading.
P2 Size and Scope of a range of different types of organisations.
The size and scope of two business organisations will be discussed in this section in
detail. The first company that is taken is WALMART, which is a fairly large company and the
other company that has been taken for the purpose of comparison is Zaffirson Food (Ferraro,
International Business Machines Corp, 2013).
The measure of WALMART is worked with in excess of representatives. Alongside that,
Walmart has 11,718 stores and clubs in 28 countries. The scope of their work is to serve broadly
and in addition global clients with their diverse business fragments like Grocery, sugar, fixings,
retail. The extent of Zaffirson sustenance is worked with just ten representatives. Their income is
£17000, and their working pay is £950. Their extent of work is to serve distinctive sort of
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nourishment and refreshments things to the national clients and acquire a colossal benefit from
them.
The size of a co-operation will decide the level of operations and the overall growth of
business in general. It is also quite important that right kind of management of resources is being
done in order to grow successfully over period of time. A big size business usually do have scope
to grow and become big, same is the case with small scale business but for that purpose, they
will be requiring right kind of leadership and management in place.
Structure, size, and degree of any association are interfacing with the objective of the
business association. It is seen that any association set an enormous focus as their goal just when
they have a decent authoritative structure. On the off chance that the association have few
individuals in their hierarchical structure and nobody has learning in regards to their part and
subordinate then it isn't feasible for them to achieve the objective since then it is difficult to
accomplish this as a result of less clearness in the part. Then again, any business association set
their target in view of their size (Fletcher, International Business Machines Corp, 2015). On the
off chance that the measure of the association is tremendous and contributes immense cash, at
that point they set the huge focus as their business objective. In any case, each association has
some regular target that is serving clients and acquires benefit, yet the benefit level varies with
the size. For instance, Zaffirson sustenance will set a little focus as their goal yet WALMART
will set the immense focus as their goal.
Association set their business objective by auditing their business scope. On the off
chance that the extent of any association is to serve national clients, at that point they will set
business objective in like manner. Then again, on the off chance that they see that they serve
global clients then they will set their business objective in like manner. As indicated by the item
and administration, an association set their structure, size, and degree. In the event that any
business association sees that, their item does not require enormous hierarchical structure; at that
point they don't set that. Then again, if the extent of business of any item or administrations is
tremendous at exactly that point an association makes monstrous association measure and makes
an extension, else, they make little estimated association.
Therefore, it can be said that the structure as well as scope of a business is decided by the
quantum of resources that an organisation posses and its objectives, whether to remain at
domestic level or to compete on an international level and become a big business over period of
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time. The size of their business is quite large and the structure of the company is corporate
structure which includes various divisional structures in it. The main competitor of the company
is Wal-Mart which is fairly big in size and its operations. For WALMART to compete with a
giant company like Wal-Mart it is highly essential to grow rapidly through proper management
of its business in an effective as well as efficient manner.
TASK 2
P3 The relationship between different organisational functions and their linkages to
Organisational objectives and structure.
The functions that an organisation will perform depends on the Structure of the
organisation, for example, if the organisation is big enough like having various divisional
structures in itself and is having large number of resources then its Functions will also going to
be large. Usually organisation decides their structure based on the role that they play in serving
its customers, if the process is big enough then certainly structure and functions of the
organisation is going to be large as well (Goodman and Mihaescu, International Business
Machines Corp, 2012).
Business capacity of WALMART is to serve clients with their item and administrations
and uphold consistency and also control in the association. Consistency can be kept up in the
WALMART through real measure of control and association can screen their business doings
through their basic structure. WALMART can accomplish a superior usefulness if everybody
associated with any undertaking has a decent learning in regards to his or her part. Along these
lines, viability in the setting of genuine target and authoritative structure can help WALMART to
accomplish hierarchical capacities since it encourages representatives to know in regards to their
part with adequacy. There are various benefits of proper relationship between Organisational
objectives and its functions which are being discussed as follows:
 If there is a proper interrelationship between the objectives that management has set for
the company and the structure of the company then it becomes extremely easy for
workers as well as employees to accomplish those objectives.
 It helps in escalation of profit level because every employee of different functions within
the organisation is vigilant enough and shares their requisite information effectively to
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each other and this would result in higher productivity as well as profitability for
WALMART.
 There is a better co-operation among the company and its branches because of
interrelationship between employees and ease of transmission of information.
Thus, it is quite clear that if an organisation carries a big structure, it becomes extremely
important that its functions should match with the objectives of the company and for this purpose
it is very important that right kind of training as well as development of individuals will be done.
So that they will be able to transmit information among departments easily and effectively, this
would result in better co-operation and a higher level of productivity for a big company like
WALMART.
TASK 3
P4 Positive and Negative Impact of various macro environmental factors on the Business
operations of WALMART.
An organisation does not run in isolation; it works in an environment which has a direct
as well as indirect impact on the company. A proper analysis of such factors which could impact
the business either positively or negatively is very crucial. For the purpose of analysing these
factors, there are various techniques which are being evolved like use of PESTLE Analysis,
which will mean a scanning of the whole macro environment elements and then trying to figure
out the positives as well as negatives for the company (Jacobson, California Business
Environments, Inc., 2016).
Different factors of the external surroundings have their major impact on the functioning
of business as when there is favourable change it encourages the business operations and on the
other hand any change which is not in the support of business affects the capacity of business to
grow. Whenever there is a positive change in the applications it encourages the distinct
departments to improve the total working capacity using the same resources. Apart from this the
modifications in legal structure of a particular country also affect the referred institution as strict
laws make it difficult to take entry in the new state.
Mechanical Progressions can give distinctive business opportunities to the WALMART
on the off chance that they can take it. Innovation opens home shopping systems; new retail
advertises electronic retailer and other online market and gives additional online market to any
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association. Therefore, it builds purpose of-offer to increase sales by enabling any association to
process money, charge and Visa framework. In any case, these innovative headways have one
negative effect i.e. online client's just chooses those organizations that have genuine mechanical
proficiencies. On the off chance that WALMART can't have any significant bearing successful
innovative progressions then they can lose their competitive advancements. Law, approaches,
and distinctive governmental regulation have a positive and negative effect on the business. On
the off chance that legislatures help any WALMART. by providing different governmental help,
credit, and auxiliaries and help them to build up their association then it can emphatically help
any association. Then again, charge rates on any corporate association may adversely influence
any association.
A PESTLE Analysis of various macro factors that have an impact on the working of
WALMART can be discussed as follows:
Political Factors As WALMART is a fairly big company and
is operating in various countries altogether, it
is affected by various policies framed by the
political leaders and parties in those countries,
which include the level of tax rates, laws
framed which relates to retail industry etc. It
is thus very essential that company analyse
these factors which could impact it positively
or negatively, and then only any decision
regarding investment and expansion is being
done in those countries (Jones and Mahon,
2012).
Economic Factors This is one of the most important factor that
has its major impact on the functioning of
business. the referred enterprise gets the
products from different suppliers and in case
of change in the tax and other rates the
quantity which is supplied gets greatly
effected. It is imperative to specify that in
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spite of the fact that the business is
developing globally, the organization is still
very subject to the UK Market where it has a
piece of the pie of around 30%.
All things considered, internationalization and
enhancement have been two key systems
sought after by the organization throughout
the years, and a noteworthy purpose behind
its prosperity. Besides, because of decrease in
extra cash levels and family wages,
WALMART, has moved the vast majority of
its concentration towards publicizing its
esteem marks instead of the more extravagant
things.
Social Factors The trends of customers are changing people
are moving towards online businesses for the
purpose of making any purchases for their
consumption. Trends have also indicated that
people in UK have moved towards making a
bulk purchase and one stop shopping. The
sort of merchandise and ventures requested
by customers is for the most part affected by
their convictions and demeanours which,
thusly, are impacted by social moulding
(Klang and Hacklin, 2013). Since clients are
winding up more mindful of medical
problems, because of which their approach
towards Food as well as food products is
evolving continually, WALMART is
adjusting to these progressions by pleasing
the interest for natural items.
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Legal Factors Technological advancement in the country
has opened up new doors for the company,
Now WALMART is focusing more on its
online retail platforms through which it can
target a larger customer base. The company is
continuously making necessary innovations
for the purpose of developing right kind of
technological platforms for its business.
Legal Factors There are various amendments in the law has
taken place regarding retail industry and its
operations, company try to incorporate those
amendments within the company in an
effective way. Various food regulations act of
the country is abided by the company by
maintain a proper quality of its food products.
Environmental Factors As the concern over Environment issues is
mounting, the company is committed to
reduce its carbon footprint by 50% till 2020.
TASK 4
P5 Internal and external analysis of WALMART in order to identify strengths and weaknesses
Internal as well as External analysis of a company would describe the different factors
that affect an organisation (Komninos, Pallot and Schaffers, 2013). After conducting an external
analysis of various factors, a proper internal analysis of internal strength as well as weakness of
WALMART would help in getting to know more about the company and its culture. Some of the
Strengths as well as weaknesses of the company are discussed as follows:
 Market Leader: WALMART is a market leader in the retail industry because of the fact
that company is having a very diverse product range than its competitors and is growing
substantially. This diverse product range would enable the company to tap consumers of
different needs as well as preferences.
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 Diversified Geographical Locations: The company is present in 7 countries in Asia and
Europe and therefore do have diversification in terms of its geographies. It can make
changes in its product portfolio based on the needs and preferences of the consumers
living in these countries that will allow it to grow and prosper even further (Wagner,
Beimborn and Weitzel, 2014).
 Good corporate culture: WALMART is famous for having a good and robust corporate
culture within the company that allows it to attract individuals to work within company.
This has a double benefit for the organisation as it helps in gaining loyalty of both
customers as well as employees towards the company.
 Loyal customer base: WALMART is having a very large customer base in various
countries and the customers are loyal for the company as the quality offered is unique and
different than other competitors. It will allow the company to grow and prosper over
period of time. It is also important that company comes up with necessary schemes as
well as discount in order to retain this customer base for long haul.
Weaknesses Huge Money investment: The company makes decision quite quickly when it comes to
opening stores in new locations without doing any adequate surveys about the location
and how much profits it can fetch, such decisions has harmed company and its cash
positions. Liquidity: The Company is facing liquidity problems because of the fact that working
capital is quite high and it is having problems regarding funding and necessary funds are
required to manage those working capital problems (Vecchiato, 2012).
 Cultural issues: Because of the fact that company operates in various countries, it have
to hire employees from those countries, and those employees would be practising a
different religion or languages, and that would create barriers for the company to grow as
they will have to make sure that right kind of training and development is being done of
the employees to make them conducive as per the inner environment of the organisation
(Lee, Gon Kim and Kim, 2012). The company shall make necessary changes within the
company to improve the overall efficiency as well as productivity of the organisation
through making these people capable enough to contribute in growth and development.
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P6 Strengths and Weaknesses interrelationship with external macro factors
The strength and weakness of company is directly interlinked with external macro
environment because a company does not run in isolation, it have to deal with various external
factors that do have an impact over it. Thus it is quite essential that right kind of strategies is
framed in order to overcome the adverse impact of these factors on company (Trimi and
Berbegal-Mirabent, 2012).
Quality and shortcomings of the WALMART have coordinate contact with the business
and it can straightforwardly influence their business. Then again, full scale ecological variables
influence the exhibitions, choices making, procedure and dealing with the business. Quality and
weaknesses affect the adjacent condition in which association works, however large scale factors
influence in the whole geographic area in which a firm works. Thusly, if any firm does not
perform well in the nation of origin and they have diverse shortcomings then they may confront a
few challenges to accomplish all around. In this way, the association must make their
internationalize methodology by assessing their quality and shortcomings (Serral, De Smedt and
Vanthienen, 2014).
On the off chance that WALMART has quality in the national market, at that point the
management of the association can take the quick choice with respect to their business-situated
in that quality. Then again, if WALMART has a few shortcomings, at that point the management
should be aware of execute diverse business procedure, and thus, they may confront challenges
to perform well.
If a company would posses necessary strengths, it shall scan external environment and
find out what is the best for company and its business and then implement the same within the
company in an effective as well as efficient manner. Such strengths can be anything like pricing
power within market, larger customer base etc, However if a company faces external
environment factors like changing macroeconomic policy etc. Then this will change the scenario
for company. Thus, the role of macro factors can’t be undermined in any way for the purpose of
growth as well as development of an organisation in an effective way.
In the same way if a company would be having certain weakness, there might occur some
factors which may either exaggerate those weakness or reduce it going forward. Thus,
Management of WALMART shall keep an eye on the events that are taking place in the external
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