Primark's Business Environment: SWOT, PESTEL, & Porter's Analysis

This report provides a comprehensive analysis of Primark's business environment, examining both internal and external factors that influence the company's performance. It begins by outlining the aims and objectives of understanding the business environment, emphasizing its role in identifying opportunities and improving decision-making. The report then delves into an analysis of Primark's internal environment using SWOT analysis, identifying its strengths, weaknesses, opportunities, and threats. Furthermore, it explores the external environment using PESTEL analysis, considering political, economic, social, technological, environmental, and legal factors. Finally, Porter's Five Forces model is applied to assess the competitive intensity within Primark's industry, focusing on supplier power, buyer power, competitive rivalry, the threat of substitution, and the threat of new entrants. The conclusion summarizes the importance of business environment analysis for strategic planning and highlights Primark's use of these models to navigate market dynamics and optimize its operations.

FUNDAMENTALS OF
BUSINESS

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................1

INTRODUCTION
Business environment is the group of internal and external activities that affects the
performances of the business and helps in identifying those activities which can be helpful for
the business operations Cherunilam, (2021, p.15). Primark is an international retailing on of the
big manufacturing company dealing in products and services worldwide. This report will include
an essay with aim and objectives of business environment and their effects on company with
Research Analysis and Discussion. Further, it will analysis of various internal and external
factors with the use of PESTEL, SWOT and porter’s model of business environment in relation
to the company.
MAIN BODY
Business environment
Business environment helps in identifying all the resources and methods for planning for
future uncertainty because it includes both macro environment and micro environment Čepel,
and et.al., (2018, p.5). Primark is biggest FASHION and manufacturing company producing
thousands of consumer goods and contributing a good amount of money in United Kingdom’s
GDP. Business environment is collection or sum of all the factors like employees, customer,
competitors, economic or political change etc. Single change in each factor can change the
overall efficiency that’s the reason it has to be studied carefully by the specialist for good growth
in the future.
The main aim of business environment is identifying various business opportunities both
internal and external so that it can be grabbed as soon as possible Akpoviroro and Owotutu,
(2018, p. 28). It also helps in improving performances of the company and helps in decision
making of plans and policies. Furthermore, Business environment is helpful in increasing the
competition within and outside the firm by studying the market internally or externally to
increase the efficiency of the performances for more growth in future. Another main aim is to
increase the sell for increasing the profits for which this company is running and operating
because higher the profits of the company higher will be GDP of the company.

Objectives of the business environment in Primark
There are various objectives of business environment in Primark for which the studies
and researches are being done for protecting the company from external environment due to
uncertainty Benzaghta, and et.al., (2021, p. 02). The first objective is knowledge of information
in which we get to know the various fields of knowledge which are necessary for the company’s
good performances like knowledge of markets, their competitors etc for making changes in our
products and services. Basis of decision with the knowledge of information the Primark takes it
decisions without any difficulty and confusions because of already needed information’s.
Decisions regarding the company’s policies and products, advertisements decisions etc for any
change for increasing the sells to earn more profits.
Survival in the market the company cannot survive in the market without planning and
analysing the markets about the external and internal business environment (Benzaghta, 2021).
These environments can totally affect the performance of the business if not taken care or studied
deeply. For the survival of the company the Primark regularly checks its internal and external
environment like the number of employees and their motivation level or customers demand in
the market, climate changes and government policies all are necessary for accomplishing the
goals and survival of the company. Another main objective is company’s Technological
planning for producing more advance products to provide more customer satisfaction. The
Primark is doing regularly the market research so that customers’ needs and wants can be
satisfied fully with more advanced technology with least cost of producing and maximizing the
profits.
Lastly, the Primark main motive is Profit maximization with customer satisfaction this
company is planning and doing various researches in the market to maximize its profits with
increasing its sell. This company has large operations internationally so it has to study all the
markets in each area and produce the products according to the customer taste for earning more
profits.
Analysis and research on the theories and models used by Primark internally
and externally
SWOT analysis

This analysis is done by Primark to know its internal business environment which are
affecting its performances and improving the inefficiencies arising.
The first step includes is identifying the company’s Strength it can be done with
separating the products and brand in which Primark has great power of autonomy and price
discrimination. The strength of the company in particular areas like this company has more
advance knowledge of specialist in each department which makes it different unique from other
firms Kannan and Veazie, (2018, p. 13).
Primark also identifying its Weaknesses by observing the weak areas like products whose
demand is low and demotivated employees because of less training and rewards etc this company
is finding ways to overcome these weaknesses for more efficiency in the work.
The business environment also helps in identifying the Opportunities like company’s
favourable external factors like shutting down of the competitors business with the same
products or decrease in the taxation policies in certain areas. This company takes all the
advantages that are prevailing in the markets by studying the business environment on time to
time and regularly.
This company can also protect its business by identifying its Threats which affects
working of the organisations like natural calamities or change in national policies, rules etc. The
company will be in threat if the new company comes with unique products and features with
subsidiary products business environment helps in knowing all the circumstances in advance for
protecting the Primark performances.
PESTEL analysis
This is another model which is used by the Primark to know its external business
environment for future uncertainty. This theory involves 6 factors which are
Political factors this are the factors which affect the company’s business operations like
taxation policies of government of different countries because different countries have different
tax policies which affects the importing and exporting of the firm Crilly, and et.al., (2019, p. 4).
Various tariffs policies creates problem in smooth flow of goods and services from one nation to
another nations.
Economic factors this are factors that affects the economy like inflation rates, exchange
rates, interest rates etc. For example if the interest rates are high the company cannot take loans

and do the investment activities or if the rate of unemployment is high people of all the class
cannot afford to buy the goods and the sells will decrease automatically.
Social factors They are the factors according to which a firm has to produce the products
like cultural environments of the company, age of the people, health of the peoples, jobs of the
customers all affects the demand of this company products. So the Primark has to produce the
products according to the social factors of the products.
Technological factors Primark is using advance technologies to produce the products
with minimum cost and high efficiency of the products. So the company environment gets
affected if the R and D activity charges high and the rate of change in technology also increase.
Environmental factors various factors like climate changes, pollutions, natural disasters,
temperature affects the business environment of the firm the Primark has to produce the amount
of products which are sufficient for the present needs Bruijl, G.H.T., (2018, p. 18).
Legal factors this are the factors like labour law for minimum wages, and consumer law
for customer protection against harmful products or various taxation laws that Primark need to
follow according to the rules of UK government.
Porter’s five forces
The Primark is using this model in an organisation for knowing the competitive edge of
the company by analysing the powers and the strength of the company.
The first force of this model is Supplier power in which supplier of the firm can decide
the price and has full monopoly in the market of its products due to no available substitutes in the
market. The company can charge any prices if its product has great demand and fewer substitutes
and earn more profits as much as it can.
Opposite of it there is Buyer power in which higher the bargaining power of the
customers due to more availability of substitutes and products in each market Pan and et.al.,
(2019, p. 15). Primark has to produce the products which have less bargaining power of the
products.
Competitive rivalry is another force through which the Primark has to check the
competitor’s actions and strategies for producing the products. The company need to check the
rivals time to time so that Primark plans its strategies for making its products look more
competitive in the present market.

Threat of substitution the company has to produce those products which has fewer
substitutes available in the market because more the substitutes are available less will be the
demand by the customers and creates fewer profits. So Primark is producing those brands with
unique features which have less or no substitutes.
Threat of new entry the company Primark has to research regularly on the external
environment in which new entrance of market and firm due to profits in that market. This
company is maintaining its customer satisfaction at its best so that new entrance does not
influence its old and stable customers.
CONCLUSION
From the above report it has been concluded that business environment is useful tool for
understanding the internal and external effects of the organisations. Further, its main objective is
to maximise the firm’s products with various techniques and overcoming the obstacles by
studying the markets carefully. It also conclude that Primark is using various theories and
models to know its external and internal strength, opportunities or political, technological etc
environment with the help of this theory the company can predicts its plan and policies correctly.

REFERENCES
Books and journals
Cherunilam, (2021, p.15). Business environment. Himalaya Publishing House Pvt. Ltd.
Čepel, and et.al., (2018, p.5) Business environment quality index in the SME segment. Journal of
Competitiveness.
Cherunilam, F., (2019, p. 10). Business environment. Himalaya Publishing House Pvt. Ltd.
Akpoviroro, K.S. and Owotutu, S.O., (2018, p. 28) . Impact of external business environment on
organizational performance. International Journal of Advance Research and Innovative
Ideas in Education, 4(3), pp.498-505.
Benzaghta, and et.al., (2021, p. 02). SWOT analysis applications: An integrative literature
review. Journal of Global Business Insights, 6(1), pp.55-73.
Pan and et.al., (2019, p. 15). PESTEL analysis of construction productivity enhancement
strategies: A case study of three economies. Journal of Management in
Engineering, 35(1), p.05018013.
Kannan, V.D. and Veazie, P.J., (2018, p. 13). Political orientation, political environment, and
health behaviors in the United States. Preventive medicine, 114, pp.95-101.
Crilly, and et.al., (2019, p. 4). Critical care nurses' experiences of providing care for adults in a
highly technological environment: A qualitative evidence synthesis. Journal of clinical
nursing, 28(23-24), pp.4250-4263.
Bruijl, G.H.T., (2018, p. 18). The relevance of Porter's five forces in today's innovative and
changing business environment. Available at SSRN 3192207.
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