Business and Business Environment Analysis Report: Iceland Supermarket

This report provides a comprehensive analysis of Iceland Supermarket, examining its organizational structure, functions, and market position within the UK retail sector. The report begins with an overview of the company, including its legal structure and size, followed by an analysis of its organizational functions. The core of the report delves into the impacts of the macro-environment on Iceland Supermarket's operations, focusing on political, economic, social, technological, and legal factors. It assesses the company's strengths and weaknesses in relation to these environmental influences, particularly highlighting the challenges and opportunities presented by Brexit and changing consumer behaviors. The report also includes visual aids such as presentation slides and figures to illustrate key points, providing a well-rounded view of Iceland Supermarket's business environment and strategic considerations.

BUSINESS AND BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
PART 1............................................................................................................................................1
TASK 2:...........................................................................................................................................6
SHORT ESSAY...............................................................................................................................6
Short Essay on Iceland Supermarket...............................................................................................6
INTRODUCTION:..........................................................................................................................6
P.1 Types of organisation and legal structure........................................................................7
P.2 Size of the organisation:...................................................................................................7
P.3 Organisational functions into the structure and objective................................................8
PART 2............................................................................................................................................9
Executive summary..........................................................................................................................9
P.4 Impacts of macro environment on business operations..................................................9
P.5 Internal and external analysis:........................................................................................13
P.6 Strength and weaknesses effects on macro-environment...............................................14
CONCLUSION:.............................................................................................................................14
REFERENCE.................................................................................................................................16

PART 1
Part 1: Presentation
Slide 1
Slide 2:
Slide 3:
1

Slide 4:
2

Slide 5:
Slide 6:
3

Slide 7:
Slide 8:
4

Slide 9:
5

Slide 10:
TASK 2:
SHORT ESSAY
Short Essay on Iceland Supermarket
INTRODUCTION:
Organisational functions of an organisation refers to the business processes of it. Iceland
is a supermarket chain shop across the UK. But they also produces frozen foods. Producing and
selling is totally different functions of an organisation. This kind of organisational function
demands changes in the organisational structure. Expands the organisational hierarchy and
increases the responsibilities of the top management. In the ever challenging UK retail market,
the business has been a tough job to perform. But with the help of modern business policies and
perfect organizing operations, companies like Iceland Supermarket survived in the retail market
for almost five decades. As one of the best growth rate in the last decade, the company is trying
to revitalize their operations by innovative strategies and intelligent pricing of the products.
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The flagship product of the Iceland Supermarket is their frozen foods. With almost 140
types of frozen foods, Iceland Supermarket is one of the most trusted frozen food brand in the
UK. As an employer, Iceland Supermarket has an exemplary reputation in the UK. It was
awarded as a best big company to work for in Britain in 2014 by the Sunday Times. The
reputation of the company is good since it meets the social and corporate responsibilities with
flying colors. And pays the taxes regularly. With the overwhelming frozen food products,
Iceland Supermarket can expect the company growth at a sustainable rate.
P.1 Types of organisation and legal structure
Various types of the organisations are operating in the market, but the main motive is to
earn the success by satisfying the large number of consumers. Private sector organisation has the
vision to operate in market by earning maximum number of funds. Public sector enterprises are
mainly deals in the public oriented operations, they functioned and produced the goods for
people as well as have the profitable earning which will utilise in designing the products as per
consumer preferences. Iceland supermarket is successfully operating in UK market has a good
growth in market than can be reflect in its earnings according to annual turnover (Helms and
Nixon, 2010). Various voluntary organisations are benefited with this supermarket chain as they
can make good reserves and generate funds during the festive seasons or national events. As
those days the premises has the heavy rush and it can be profitable for the small industries who
are indulged with this corporation.
By delivering better value to the customers and better rewards to the staffs, the revival of
fortunes if Iceland Supermarket has been possible. Preparing frozen foods is the core function of
Iceland Supermarket. Since operating mostly in the UK, Iceland Supermarket is a centralized
organisation. Most of the raw materials are imported from foreign countries. Thus the internal
staffing is not as much as expected (Trucco and et.al. 2008). The organisational functions like
research and development is helping Iceland Supermarket on gaining the confidence of the
customers by developing quality products and packaging. Stakeholders are backing the top
management and not interfering in organisation’s operations.
Ice land supermarket as the private industry has the profitable share value which indicates
the favourable brand image of this industry. This business serves the citizens of UK on the basis
of satisfying their needs or demand. Thus, this organisation has the favourable market share as
well as it has the fruitful index in generating investments from such stakeholders.
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P.2 Size of the organisation:
The organisational size includes the size of the human resources, annual turnover and the
market shares. Iceland supermarket need to expand the human resources of the organisation as to
meet the better service in the stores. This organisation has acquired more than 2.2% shares in the
UK food market (Fisher and et.al. 2012). This is largely spread in various areas and has more
than 800 stores. The organisation is mainly deals in the frozen food and the other grocery items
including prepared meals, vegetables, meat and other dairy products. The annual turnover of the
year 2014 was around £160 million. It has the employee turnover which is around 25,000.
P.3 Organisational functions into the structure and objective
Business structure can be understood by the various factors which indicate the
organisation as the sole proprietorship, partnership as well as the public sector. It helps
the organisation in giving the framework or objective to serve the society. It includes the
internal or external environment of the organisation such stakeholders and profitability of
organisation. In ice land supermarket there can be requirement of large number of human
resource in context with making the favourable dealings with consumers.
Ice land supermarket must implement various promotional techniques which will
help them in enhancing the operational activities of the firm. Hence, there is need of
adequate volume of workers who will help in such business activities. Hence, it can e
said that the firm has profitable growth in the recent years so there is need to maintain the
shareholders investments as well as company need to design the products as according to
the needs or requirements of the buyers.
PART 2
Executive summary
P.4 Impacts of macro environment on business operations
The report emphasized on the macro environmental factors related to Iceland
Supermarket. Since Iceland Supermarket is a retail chain, it is more vulnerable to the political
and economic factors. We found Iceland Supermarket really well placed in the frozen food
market. But in the other sectors they have weak links to address. With a low market share,
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Iceland Supermarket has an uncertain future after the unavoidable consequences of Brexit,
Iceland Supermarket’s brand portfolio do not show any other products other than the frozen
foods to fight the downfall in the British economy. The economic condition of the UK will
surely turn around, but the question is, is Iceland Supermarket capable of facing the present and
future challenges arising due to the Brexit? Managers of the organization tried to address the
answer of that question in our detail report inside. British origin Iceland supermarket chain is one
of the oldest and reputed organization in the UK (Mankiw, 2014). Leaded by Malcolm Walker,
Iceland Supermarket has faced many downfalls in the past. Most recently in the early
millennium, Iceland Supermarket experienced a massive downfall in their profit. But after the
return of the founder Malcolm Walker in 2005, Iceland Supermarket showed a great turn around
in their business. Below we will try to analyze s the macro environmental factors related to
Iceland Supermarket.
Political Environment: Since Iceland Supermarket is a British company, it is facing a
tough time in the recent past. After the Brexit, in last four months the price of the pound has
fallen by 18%. Hence the production cost has risen significantly. Price of several food and
cosmetics items has risen (Helms and Nixon, 2010). And in addition to that, the discussion of the
referendum of Scottish independence has put some more uncertainty in Iceland Supermarket
future. As an organization Iceland Supermarket is still struggling to deal with the other
supermarket chains. Now they are afraid of losing market shares due to the tension between the
UK and the EU. Government of the UK always encouraged the retail business, since it creates
job opportunities to the students and local people. Thus the political situation at the UK do not
influence the business of Iceland Supermarket. Various locations has the various local
government. There should be proper implementation of all the rule and regulations. There should
be proper taxation or duties paid on the products which are imported.
Economic Environment: From the experience of price inflation of basic commodities
back in 2008, the future of Iceland Supermarket is in great danger after the recent price inflation
due to Brexit. Iceland Supermarket has a low market share compare to the other supermarkets
like Waitrose, Iceland Supermarket, and Aldi. Thus, any bad economic situation can result in a
massive downfall in the profit. On the other hand, Iceland Supermarket imports most of its raw
materials from foreign countries. If Britain gets out of the EU in 2018, Iceland Supermarket can
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face more rise in their production cost (Freixas and Rochet, 2008). Due to Brexit, many global
banks are shifting their offices to outside the UK. Which can result in more unemployment for
the British people. Companies like Unilever has already increased their product price, and other
big companies are thinking about the price hike.
Thus the disposable income of the people is decreasing in recent time. In such position,
people is demanding a value for their money. But increased price of the basic commodities is
making business more difficult for Iceland Supermarket. Economic factors are of concern to
Iceland Supermarket, because they are likely to influence demand, costs, prices and profits. One
of the most influential factors on the economy is high unemployment levels, which decreases the
real demand for many goods, undesirably affecting the demand required to produce such goods.
Figure 1: Iceland supermarket is emphasizing in discounted business strategy
Social environment: The rise in the prices of various ingredients, materials which are
forcing in increment of the cost or expenses mad by organization in order to overcome such
operating expenses. Which in turn helps the people to save costs of food and give them extra
money for the other livelihood. It is also making the business difficult for supermarkets like
Iceland Supermarket (Fisher and et.al. 2012). The sales of the commodities is getting down in the
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