Report: PESTLE Analysis of Sainsbury's and Key Drivers of Change

This report presents a PESTLE analysis of Sainsbury's, a UK-based supermarket chain, examining the external factors influencing its decision-making. The analysis covers political, economic, social, technological, legal, and environmental factors. The political factors include the impact of Brexit on imports, while economic factors encompass rising costs and competition. Social factors highlight consumer trends like healthy eating and ethical sourcing. Technological advancements like big data and online shopping are also explored. Legal aspects include employment and discrimination laws, while environmental considerations focus on carbon emissions. The report also identifies key drivers of change, such as adopting new technologies, becoming more environmentally friendly, and understanding customer needs. The conclusion summarizes the impact of macro factors and drivers of change on Sainsbury's, emphasizing the need for the management to adapt to the changing business environment. References from academic journals and business publications support the analysis.

Global Business Environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Global business environment is the environment in different sovereign countries with factors
that influence decision making. Sainsbury’s is a UK based supermarket chain which has its
headquarters in London. It has also spilt into two more divisions which are Sainsbury’s bank and
Argos. In the further report light will be put upon the pestle analysis of Sainsbury’s and the key
drivers of change that the management should be taking.
MAIN BODY
PESTLE analysis of Sainsbury’s
Pestle analysis is the tool and framework to analyse and monitor the key factor that
influence the external environment on the organisation (Perera, 2017). The following is the
pestle analysis of Sainsbury’s;
Political factor
The political factor of Sainsbury’s has impacted very severely as UK took decision to
leave European union and it would make more difficulty for Sainsbury’s to affordably import
products from abroad. As cost will be increased and burden will be passed on to consumer
(Vallati. and Grassi, 2019).
Economic factor
Rising costs of fuels make it expensive to transport goods and will lead to lower profit
margins. Also, rising salary expectations of the workers and paying them more will add on to the
expenses of Sainsbury’s. Fierce competition is also a factor that influences Sainsbury’s and
forces them to innovate (Shtal. and et.al, 2018).
Social factor
The trend of healthy eating has also forced Sainsbury’s to adapt to the consumer demands
for the long term success. Also consumers are becoming conscious of the source of their food
therefore it also enhanced Fairtrade movement.
Technological factor
Technology advances like use of big data and artificial intelligence allow Sainsbury’s to
know if their products are expected to sell and at what price. The trend of online shopping has
also given Sainsbury’s an advantage of capturing large customers (Bentham, 2018).

Legal factor
There are some legal laws that influences the working of Sainsbury’s like employment
law, discrimination law, health and safety law etc. While making policies Sainsbury’s has to
adhere to these laws.
Environmental factor
The responsibility of every organisation operating has a responsibility towards the
environment in which they are operating as Sainsbury’s also contributing in the emission of
carbon dioxide. So it is the responsibility of this supermarket to become more environmental
friendly and minimize the ecological damage (Nandonde, 2019).
Key drivers of change that management should take into notice.
Some key drivers of change that the management should be taking notice in their
deliberations for the future direction of the firm are:
Sainsbury’s should adopt new and advanced technologies to improve customer experience.
They should also identify and implement new ways to become more environmentally friendly
and consider how they can minimize the ecological damage caused by their operations. This
would build trust among the customer and society.
The supermarket should listen to the customers’ needs and frustration, research the technology
marketplace carefully and pilot the solution before large scale implementations. They can
implement coupon-at-till printer combine it with Nectar data and provide customers with
personalized offer to help customers live well for less.
CONCLUSION
It can be concluded that there are various macro factors like political, economic, social,
technological, environmental and legal that impact on the Sainsbury’s operating environment and
there are various drivers of change that the management takes notice like technological
advancement, going environmental friendly etc.

REFERENCES
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Shtal, T. and et.al, 2018. Methods of analysis of the external environment of business activities.
Bentham, J., 2018. Business and Economics in the News–Sainsbury's and Asda-the decade's
mega-merger. Teaching Business & Economics. 22(3). pp.11-12.
Nandonde, F.A., 2019. A PESTLE analysis of international retailing in the East African
Community. Global Business and Organizational Excellence. 38(4). pp.54-61.
Vallati, M. and Grassi, A., 2019, July. AI to Facilitate Legal Analysis in the PESTLE Context. In
The EMerging Technology conference (EMiT) 2019 (pp. 66-68). IET.

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