Gymshark Organizational Analysis: Functions, Macro & Micro Factors

This report provides a comprehensive analysis of organizations, focusing on their types, sizes, and scope, with Gymshark as a case study. It explores the interrelationship of various functions within an organization, including marketing, finance, and human resources, and how these functions contribute to the overall objectives. The report also examines the positive and negative impacts of the macro environment on business operations, utilizing the PESTLE model, and assesses the internal strengths and weaknesses of Gymshark through SWOT analysis. Furthermore, it critically evaluates the impact of both macro and micro environmental factors on decision-making and business objectives within the organization, providing insights into how these factors influence strategic choices.

Organization

Contents
1.0 INTRODUCTION.....................................................................................................................1
2.0 Explaining the different types, sizes and scope of organization................................................2
2.1 Explain different types and purposes of organizations.....................................................2
2.2 Explain the size and scope of a range of different types of organizations.......................2
2.3 Analyzing structure, scope, size, and scope of different organizations............................3
3.0 Demonstrating the interrelationship of various functions within the organization....................4
3.1 Explain the relationship between different organizational functions...............................4
3.2 Analysing the interrelationship between organisational functions...................................5
4.0 Critical analyses of complexities of different organizations and structures..............................6
5.0. Positive and negative impact of the macro environment on operations of business................6
5.1 Identifying the positive and negative impact of the macro environment.........................6
5.2 Analyze macro environment of organization using the pestle model..............................9
6.0 Determining the internal strengths and weaknesses of an organization and their
interrelationship with external macro factors..................................................................................9
6.1 Conducting internal and external analysis of an organization..........................................9
6.2 Explain how strengths and weaknesses are interrelated with external macro factors....11
6.3 Discuss how SWOT analysis influences decision-making in an organization...............12
7.0 Critical evaluation of the impact of both macro and micro environmental factors have on
decision-making and business objectives in an organization........................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14
Books and journals:..............................................................................................................14
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................14

1.0 INTRODUCTION
Serving public or doing business is a process which is managed by a group of people. They
have to perform various tasks in the organisation which include planning, structure selection,
management, logistics, running and organising management, coordinating and many more. All
these tasks have been performed by a person who can be known as manager. The Chosen
Company for this report is Gymshark which is a British fitness a pale and brand of accessories
manufacturer along with the retailer. This company was founded by Ben Francis and Lewis
Morgan in 2012. It's headquarter is in Solihull, England. This report is divided into two parts in
which first part is dealing with various types of organisations, their sizes and scope. Furthermore
it will cover the interrelationship among the several functions of an organisation and how they
are linked to the objectives and structure of organisation. Another part of same report includes
the examples which are used in analysing the both positive and negative impact of macro
environment on the operations of a business organisation (Subramanian, S., 2018). In addition to
this or small study on the internal as well as external strength and weaknesses of Gymshark has
been done for the purpose of explaining the interrelationship with their external macro factors.
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2.0 Explaining the different types, sizes and scope of organization.
2.1 Explain different types and purposes of organizations
Business refers to the collection of activities of convertible processes of material and skills for
the purpose of satisfying the needs and requirements of customers by providing them goods and
services. Business environment is also made with the collection of several factors such as
government activity, technological development, resources, industry trends, competitors,
demography and many more (Chang, Wong and Chiu, 2019).
It has been found that there are 5 types of business organizations which include private public
organization government cooperative charities and NGOs. Below mentioned is the brief
introduction about all the types of business organization:
 Private Sector: It refers to that business organization which has been controlled and
managed by private individuals or a group. The business organizations under this sector
have been developed for the purpose of earning profit only. Gymshark is the best
example of a private sector company as it is a multinational company performing
business just only to earn profit. Limited company, partnership, sole traders and
cooperatives are considered as the types of private organization. Sole proprietorship
refers to the business which is completely owned and managed by a single individual.
Partnership can be explained as a business which us run by two or more than two people
under an agreement to share profit and losses in a specified ration. Company refers toa
business organization having separate legal entity and common seal.
 Public Sector: It is well known that the government or agencies of government are
responsible for handling the economy of public sector by managing and controlling the
businesses. England and Wales Cricket Board is the best example of a public sector
organization as it is managed and controlled by the UK Government. State Government
refers to the government of a state which perform all the legal works within the specific
state of a country. Central Government refers to the government which is responsible for
the entire works in the complete country.
 Voluntary Structure: This sector includes those organizations which are formed of
Charity, business community and voluntary bodies (Kodhelaj and et.al., 2019). The
organizations under voluntary structure does note developed for the purpose of earning
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profit. These are Non governmental bodies hence they are also known as Non
Governmental organization.
2.2 Explain the size and scope of a range of different types of organizations.
Business organization can be defined as the organizations which are performing business
operations with the purpose of providing goods and services to the customers. But on the basis of
several factors these organizations have been divided in 5 types i.e. Private Organization, Public
Organization, Government Organization, Cooperative and NGOs.
Limited Companies always have their own legal identity which states their own rights. As
the company have own legal identity so all the properties are owned by the company itself not by
their members. The liability of members of such organization is limited. Hence they are not
liable to pay the debt by using their personal assets. It is necessary to have two or more than two
members to start this company. Along with this it is also essential to submit several of
documents such as memorandum of association and article of association for the purpose of
making company limited.
Private Limited Companies are the companies which involve minimum one share holder.
But after starting the organization, its shares can be offered to the general public as well. Private
Limited companies offer their share to people for the purpose of attracting them towards the
organization and collecting sufficient amount of capital for their organization. Gymshark had
appointed at least one director for their each and every branch of their organization. They also
started offering their share for sell to the general public.
Gymshark has developed such policies which help the organization in maintaining their
profile as a business limited company. They had registered their organization under the London
Stock Exchange. It make easier to sell their shares to the general public. London stock exchange
is responsible for monitoring the trading process of their shares. Gymshark also arrange Annual
General Meeting with their stakeholders to maintain their interest towards organization.
Directors direct the organization to perform their work. A right has been given to the
stakeholders to select the right person who can take the important decisions regarding the all
important matters of investment and the development of marketing.
2.3 Analyzing structure, scope, size, and scope of different organizations.
Furthermore public limited companies are divided into three types i.e. Small, Medium and
large. Small businesses refers to the business organization which works in a very small market
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for stopper hence it becomes very difficult for them to survive in a high competition market as
the competitor of large businesses. It has been also found the title the scope of making changes in
their management strategies is very small. Just an entry of another business in the same industry
can destroy the small business completely because of lack of resources which may be used to
protect themselves from their competitors. On the other hand it has been found that large
businesses have a several resources which they can use to protect themselves from any new
competitor by increasing the higher cost of entry in the market.
Medium size business also has to face some difficulties in the competition but as compared
to small businesses they have to face fewer difficulties. They sell their services to a large market
as compared to small businesses under which they get a chance to change their strategy is a once
or twice in a year. In addition to this, medium sized business also have opportunity to enter in
new markets with their existing products or. This act may result in the higher profit earning but
they always have various difficulties in their journey from their competitors who are already
available in the market. It has been also found that the race and resources both are high in large
organizations.
Along with this, it has been analyzed that the organizations are also classified on the basis of
production i.e. primary, secondary and territory. Primary organizations perform the functioning
of production of raw materials by using the natural raw materials and transfer them to the
secondary organization for the use. Secondary organizations perform the function of converting
that raw material into finished goods and forward them to the territory organizations. Retailers
come under the territory organizations as they perform the function of selling the products or
services to the customers.
Scope of an organization can be analyzed by analyzing the nature of products. Gymshark
organization is responsible for producing and supplying sports accessories. Hence it can be
considered as a territory organization as it has wide targets which support more resources to
protect themselves from the entry of new organizations in the market.
Organizations create their vision, mission, goals and objectives for the purpose of
bringing improvement in the performance of entire business organization. Vision refers to the
position where the organization wants to go in future. Mission defines purposes and rules of the
organization. Mission provides scope to the organization in order to fulfill their objectives. It can
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be considered as the reason for selecting mission. Objectives refer to the shorter targets of the
organization.
Shareholders and stakeholders are responsible for all business operations will stop
stakeholder’s rapids to the persons who are related with the business organization. Generally
stakeholders it affected by the activities of the business organization. Gymshark is a global
organization which included dispersed dynamic and uncontrollable environment. Hence any
change in the trend of customers and Society can affect the business and government of
organization. It can be said that it is unpredictable.
Gymshark is found as a medium private company which has almost more than 550
employees are working. Sports apparel brand Gymshark has just hit a $1.3 billion valuation after
securing investment from General Atlantic. The company, started by Birmingham U.K.-born
Ben Francis in 2012, now age 28, has entered into a strategic partnership in order to expand
further internationally. General Atlantic will take a 21% stake in the business following the deal,
which marks Gymshark’s first ever investment round
3.0 Demonstrating the interrelationship of various functions within the
organization.
3.1 Explain the relationship between different organizational functions
Below mentioned are the several functions of Gymshark: Marketing Function: Marketing function creates the relationship between market and
customers. It helps the organization in reaching to the customers and sell them their
products. It is necessary for marketing manager to analyze the new Strategies and do
research and development programs so that they can get to know about the needs and
requirements of customers. After knowing their needs of the organization can make
changes in their products as per the requirements of customers. Finance Function: This function of an organization takes care of the usage and
expenditures of the resources in various operations. Along with this it also provide the
entire report on the performance of a financer and the position which is related to the
preparation of a business plan.
 Human Resource Function: In order to performing all the operations in an organization,
it is necessary to have proper human capital as well. In order to hiring the employees and
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managing all their issues, human resource manager plays an important role. Human
resource management developed various policies and Strategies which are beneficial for
the organization. It also performs the functions of motivating their employees towards
organizational goals. In addition to this it performs various employees’ engagement
activities at workplace which result in retaining the employees.
3.2 Analysing the interrelationship between organisational functions Marketing and Finance Function: In the context of Gymshark, the employees how to
perform various marketing activity is a in which they have to influence the customer so
that they buy their products. For the same purpose they are required to have sufficient
amount of money. Hence they have to prepare finance plan. Finance function of the
organization will prepare a complete plan under which they divide the expenses of
marketing activities.
 Human Resource and Marketing: For the performance of operating the activities of
marketing, a lots of skilled and experienced employees are required in the organization. It
is the responsibility of Human Resource Management to hire the candidates as per the
requirements of organization. They have to select the best skilled and experienced
candidate for their organization so that they can perform all the activities of marketing
functions. Hence marketing and human resource management are interrelated with each
other.
4.0 Critical analyses of complexities of different organizations and structures.
It is not necessary that the complexities in any organisation are always bad for them. There
are various reasons which might create some complexity at workplace which are as follow:
 Huge number of stakeholders which include lots of suppliers, customers, media, investors
and competitors.
 Various steps which should be followed in the process to get the job done.
 Various structures followed by organizations such as divisions, subsidiaries and joint
ventures.
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In the context of Gymshark the complexities come as a challenge for management. Its effect
can be seen on the decrease in the moral of employees and impedes competitiveness. Through a
study it has been analyzed that more than 50% of Executive working in the multinational
companies all over the world said that organizational complexity cuts into their profits. It is also
analyzed director complexities in organization arise mostly in IT and Technology industries.
Gymshark can avoid the organization Complex by removing strict and complicated rules,
improving customer engagement, prioritizing their tasks, improving workplace etiquette and
maintaining a simplified structure in their organization. All these actions give benefit by
reducing the complexity and provide higher return on the capital invested in the organization. It
also results in reducing the cost as it will remove all the unnecessary activities and improve
employee satisfaction.
5.0. Positive and negative impact of the macro environment on operations of
business.
5.1 Identifying the positive and negative impact of the macro environment.
Business environment is collectively known as the environment where internal and
external factors such as customers’ needs, employees’ expectations, management, innovation in
technologies, activities by government, economic changes, market trends and many more affect
the business functioning and its decision making. A collection of these factors impacts the
business environment and its situation. Pestle analysis is a detailed framework that is used to
examine and monitor different macro environmental factors which have a significant impact on
the business performance. This model is also supportive in introducing a new venture or when
organizations are expanding its business in other market.In context of Gymshark Company, the
following are factors that have a positive and negative impact on the business: Political factors:Political factors plays a vital role in operating routine operations of
business. As the chosen organization conducts the activities that are associated to the
fitness products. In order to achieve success in the sports industry, it is necessary to take
into account political factors that improve the working patterns of business. For instance,
in order to have trademark on the products, the company requires legal documents to
operate the functioning of business. Gymshark also offers products in several countries
and varieties of products to both women and men. Hence, to consider the business
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strategy, it is necessary that to consider the political differences. Brexitalso has a direct
impact on the business sales.
Positive impact: Due to Brexit, the company do not have to follow rules and regulations of EU.
Negative impact: The chosen company has been pressurized by government for licensing. Economic factors: This factor provides a direct impact on the consumers’ buying
behaviour for Gymshark goods. The economic factors such as inflation rate, capita
income, unemployment facilitate a direct impact on the business profitability. This is one
of the factors that majorly impact the buying decision of consumer and reduces the
purchasing power.Due to the ups and down in the economic factors, the demand for the
products is also impacted.
Positive impact:At the time of recession, the demand for Gymshark products improves
and the cost of labour is considered by the choose organization.
Negative impact: Brexit has brought inflation which leads to raise in prices of products,
and customers of UK are less spending due to instabilities in economic factors. Social factors: Customers’ demands and wants keep on changing with the time. The
selected company focuses on the designing that is associated to fashion. This company
provides products which can be used every age group, religion and lifestyle. Social
factors have an effect on the buying pattern of the customer as well asinnovation. These
factors must be implemented in such a manner that it can attract more number of
customers towards brand.
Positive impact:Customers in UK are highly fashion oriented and fitness freak which
provides it an advantage to expand its business.
Negative impact:The negative impact is that due to changing buying behaviour of
customer has lower down the sales of company. Technological factors: Technology is one of the essential factors that have a huge impact
on the business productivity. If an organization adopts an advanced technology, then it
can easily attain success and objectives of business (Subramanian, 2018). The chosen
organization has its own unique technologies that makes a difference from other
organizations in the sports industry. The organization not only considers the
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technological factors in production but also manufactures goods such as gym bags.
Additionally, the online store also providing an excellent experience to the consumers.
Positive impact:It provides an extreme level of online shopping experience to its
customers.
Negative impact:Advanced technology considers cost which affects the revenue of
business. Legal factors: The organization should be aware of all the legal proceedings so that their
business operations or activities can be done in a most effective way. The legal act
involves a supply of products, trade description act, complaints and sale. In context of
Gymshark, it should be aware of import, export, name of the products, sale of products so
that they do not have to face any legal penalties on the company. It is also important for
the organization that it should be focused on its trademark so others cannot be copied.
Positive impact:Gymshark follows all the prevailing laws of UK government which
improves trust level among customers and also enhances customer base.
Negative impact:The trademark fee is formally set by the government. If they do no pay
trademark fee on time, then it can be lost by the company. Environmental factors: It is found that Gymshark Company do not manufacture any
kind of product that are restricted by the local government. This helps to minimize
volatile and several compounds emissions. The main aim of the business is to improve
the sustainable products that will improve the functionality and quality.
Positive impact:By increasing the social awareness in consumers, the company is
reducing carbon emissions in their manufacturing factories.
Negative impact:The competitive position in the market is getting affected due to the
tightening policies and regulations related to environment (Ngai and et.al., 2018).
5.2 Analyze macro environment of organization using the pestle model.
It is analyzed from the pestle analysis that there are several macro environmental factors
that directly affects the business objectives, success as well as decision making. Managers of the
Gymsharkhave to take critical decisions which are beneficial to the company. In case of
Gymshark Company, they have to consider both impacts related to each and every factor so that
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they could not miss any growth opportunities for the business in future. The analysis also shows
that the main external factors impacting the business are political and environment. Due to
various uncertainties in situations such as BREXIT which have caused a lot of insecurities,
involving economic uncertainties and probable future changes in politics and laws in UK. This
will impact the chosen organization from various trading laws (Bini, Bellucciand Giunta, 2018).
6.0 Determining the internal strengths and weaknesses of an organization and
their interrelationship with external macro factors.
6.1 Conducting internal and external analysis of an organization.
An analysis of SWOT defines an examination of business’s internal strengths and
weaknesses and external growth and improvement opportunities and also examines the threats
that affects the performance of business.It is also observed that there is some tough competition
in the sports market but Gymshark has its own unique strengths and several opportunities which
could use to improve and grow. But on the other side, this company like any other organization
has its fair share of weaknesses and threats. The following is SWOT analysis in the Gymshark’s
context:
Strengths  By undertaking an effective approach to
marketing its products and services, Gymshark is
achieved a significant online presence and gained
much attention by their customers.
 It has experienced a significant growth at a very
fast pace, while its extreme improvement
supports customers to see its value and feel
excited to try their products.
 Its athletes demonstratea strong devotion to the
lifestyle of fitness and a manifestation of the
company. These influencers often promote the
items of company in order to grow and develop a
fitness community.
Weaknesses  The company carries a huge variety in female
products category but there are not as much
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options available for men's category. This
drawback of company shiftstheir consumers to
other brands (Leminenand et.al., 2020).
 It facilitates its product only online. There are lots
of consumers who do not prefer and like to
purchase through online platforms. Various
factors that can affect the online purchasing such
as time to get the products, shipment prices and
so on which plays a major role in the buying
decision of a consumer.
 The sports industry is very competitive as it
involves major brands such as Adidas, Nike
which have more shares in the sports market.
Therefore, Gymsharkhas a very little market
share.
Opportunities  The brand does not use any classical marketing
procedures that are billboards, TV commercials to
advertise its products. Using such approach
would also support in providing more exposure to
the brand.
 As the company offers only athletic apparel, it
can also offer athletic footwear which is a very
lucrative niche. This would be a great opportunity
for the brand to launch its own footwear to gym
freaks .
Threats  It has huge competitors in the market such as
Adidas, Nike and many more which provide very
competitive prices to their customers. They are
also working on ways to increase quality or to
reduce price or providing exceptional quality at
very reasonable prices.
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 Suppliers is also one of the major threat to the
company. Sudden withdrawals or increases in
cost by the suppliers could lead to some major
pricing issues which affect the business goals and
plans (Kong and et.al., 2020).
6.2 Explain how strengths and weaknesses are interrelated with external macro factors.
Political:As the political factors are stable in the UK market will help the Gymshark on
large scale to improve its brand image in the future also.
Economic factors:During recession the sales for the products and services for the athletic
items also improves which can support the company in becoming the largest sports throughout
the globe.
Social factors: As a brand provides its products on online platforms only, it can lack in
its business. Moreover, the brand majorly offers to women so this could be an another factor as a
weakness.
Technological factors:The brand already developed itself by adopting advanced
technologies that can help in its online business and also which can make them better from their
rivalries. Therefore, it could improve the brand image of Gymshark.
Legal factors: The non-allowance of rising or declining the prices without notice can be a
weakness for the brand as it limits their market in specific countries.
Environmental factors:The reduction in carbon emissions in manufacturing factories
will help the brand in becoming a leading sports company throughout the world for a longer
period of time (Heidari and eta.l., 2018).
6.3 Discuss how SWOT analysis influences decision-making in an organization.
All the factors in the SWOT analysis influences the decisions in business. This analysis
helps to evaluate the business’ strengths, weaknesses, threats and opportunities which are linked
to overall business tactics. Managers of companies can make business decisions by looking on
the new opportunities in the market. It will also support company to increase its profit share. It is
also important for the company to look on threats and weaknesses in order to work on the areas
where they are leaking and could develop new opportunities for the business (Fuller,
Jacobidesand Reeves, 2019).
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7.0 Critical evaluation of the impact of both macro and micro environmental
factors have on decision-making and business objectives in an
organization.
It is critically evaluated that there are various factors involved in micro and macro
environment of the business that have a huge impact on the decision-making and objectives of
business. Managers have to consider all the factors in order to make good decision for the
business. Factors that are favourable for the company can create immense growth
opportunities.For instance, if the economic factors such as interest rate is lower, then, the
respective organization can create various growth opportunities by establishing its objectives for
expanding its business in many areas. But on the other side, legal factors may restrict the
company to abide laws and regulations (Cominand et.al., 2019).
CONCLUSION
It is concluded that all the types of companies have to abide all the legal compliances
prevailing in the operating nations. It is important that a company should have proper
coordination between all the departments that supports in the achievement of long term goals.
The external factors influencing the business had positive and negative affect on the business
functioning. SWOT analysis outlined the strengths, weaknesses, opportunities and threats of
Gymshark Company. These factors also affects the business decision.
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