Business Environment Analysis: Sainsbury's Functions and Operations

This report provides an analysis of Sainsbury's business environment, exploring various aspects that influence its operations. It begins by defining and differentiating various business types, including sole traders and partnerships, outlining their objectives, sizes, and organizational structures. The report then delves into the relationship between different organizational functions such as design and production, finance, human resources, sales and marketing, and research and development, and how these functions are linked to the company's objectives and structure. Furthermore, the report identifies and examines the positive and negative impacts of the macro environment on Sainsbury's business operations, providing a comprehensive overview of the factors affecting the company's performance. The report uses Sainsbury as a case study and provides insights into its internal and external environments.

BUSINESS AND BUSINESS
ENVIRONMENT

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INTRODUCTION
Business and business environment consist various element which influence to
organisation activities such as internal and external. In internal factors it includes policies, rules,
employees and intrinsic activities (Westerlund, Leminen and Rajahonka, 2014). On the other
hand, in external it consists customer, suppliers, government and various aspects that generates
impact from outside. External factors are beyond the control of management whereas internal
factors can control by the company. Present report is based on Sainsbury which is public Ltd.
business operates functions in retailing. They are offering different types of food products such
as dairy, bacon and hams, poultry and game, cooked meats and fresh meats (J Sainsbury PLC,
2017).
For gaining insight knowledge of the firm, present report covers purpose, size and scope
of different types of organisation. Furthermore, it also includes relationship between different
organisation functions and how it can be link to objectives and structure. Moreover, it also
internal and external analysis of the enterprise to identify their strength and weaknesses,
TASK 1
P1 and P2
Explains different types, size, scope and purposes of organisation
There are different types of business which consist different objectives within the market.
Thus, their activities and methods are also different from each other which develop their
profitability at workplace.
Following are several types of enterprise according to their objectives, size, scope and
organisation structure:
Sole trader
 Sole trader organisation is a business that sets up their own enterprise. They are taking
decision to employ other persons or not. In this aspect, the enterprise has unlimited
liability to make success at workplace.
 There are huge investment is also made to become a sole trader which is depends on
personality with effective results.
 It is easy form of business structure which relatively easy and inexpensive to set up the
goals.
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Objectives
 In respect to make effective results, sole trader possess objective to creating self-
employment with themselves. Instead of looking towards other, they are also determines
fund to operate functions and operations.
 Sole trader business is also provides opportunities for in depend and honourable living to
make decisions to serves for customers.
Size of sole trader
 These types of business are running with own capital investment to control over money.
 There is large and short number of people working within the businesses.
Scope and structures of the organisation
 These business has aim to prevent concentration on economic power in few hands
through equitable distribution.
 It facilitates the growth of cottage and small scale industries.
 It promotes independent living for pride ownership.
 These businesses have structure can be determines in artistic jewellery, health clinic,
stock brokers, etc.
Partnership
 A partnership is a single sense of unit in which two and more people share their profits
and loss. In this aspect, each business partner participates through money, property,
labour and skills.
 In term of getting profits, they are share their outcomes and results in effective way.
Legally partnership is requiring in different types of arrangement such as general
partnership, limited partnership and joint venture, etc.
Objectives
 Main aim consisting of partnership is sharing of profit and loss.
 With the help of partnership, businesses can enhance their profits and revenue with
assorted resources through obtains capital.
 Partnership is also giving employment advantages which assist to increase profits and
revenue of the enterprise through operating functions and operations.
Size of partnership business
 A partnership business is running with small and large size of enterprise.
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 In this aspect, different types of organisation working such as health care, stock market
and many other elements.
Structure and scope of the partnership businesses
 Partnership is working with simple structure in which two or more than two businesses is
working for creating more profits and revenue.
 With the help of hierarchical structure, this enterprise is determines concept for dealing
various situations.
 In the management of partnership, it has been develops that in future they are enhancing
profits and revenue through creating profitability.
 It is also determining the profitability through ascertain success and positive results.
P3 Explains relationship between different organisation functions and link it with objectives and
structure
Organisation functions includes various elements which can be divide in different aspects
such as marketing, financing, accounts and production, etc.(van Buuren, Koch and Wright,
2014). Each part of function carry profits through several activities which achieve for aims and
objectives of the business. Sainsbury is operating functions for deliver effective products and
services to customer so that the business can maintain profitability at workplace. Following are
different functions in which objectives can be achieve and structure also followed:
Design and production
Every business design their products and services very effective so that they will achieve
high base of customer at workplace. It will assist to achieve common objectives and goals
through communication process at workplace. With the help of this function, Sainsbury can
make clear objectives so that they can attain high market share from different activities and
actions (DeYoung, Gron and Winton, 2015). Further, divisional organisation structure assist to
assign duty and responsibility to each member so that the cited firm can attain high profits and
customer base at workplace. They can attract potential customer as well within the business
environment so that it is beneficial to make objectives at workplace. It can be done through
regular monitoring on goals of the enterprise. Hence, it can be stated that objectives and structure
has direct relationship within the cited firm. For example, in design and production team, for
making new product the upper level management has responsibilities to provide instruction to
middle level employees. In mid level, workers frame policies and strategy to give direction at
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lower level people. It creates relationship between various people so that objectives of the
enterprise can be achieved in a systematic way. In hierarchical structure, communication runs in
systematic aspect which determines to collect useful information that is available for delivering
outcomes and results.
Finance of the enterprise
Finance is also important element which delivers effective operations within the business
environment. It consists manual and economic records which can be develops profits through
invest more money in Sainsbury. As results, the chosen organisation makes their financial
statements which support to taxes and legal requirements (Woodside, 2015). Information can
also be used to produce management accounts which assist to enable to make plan and strategy.
Hence, responsibilities for administering employees can be reviewed to determine salary at
workplace. In wages of employee, the cited firm also make deduction so that they will easily
attain their participation towards the goals and objectives. In addition to this, employees of the
firm also protects in term of loan payment and getting pension after living job. Information can
be collected through market in term of feedback and reviews. The chosen business has objectives
is to increase profits so that divisional structure assign duty and responsibilities to each member.
Hence, it will support through finance function (Manikandan and Ramachandran, 2015). For
instance, the company require fund to produce new product, then they have to make arrangement
for it carefully. For accomplishing this objective, Sainsbury need to make their relation with
financial department and bank as well. Further, different organization function will be evaluated
so that budget can be calculated for the same. It will assist to provide proper instruction at each
level of the company. Hence, communication will take place which will assist to provide proper
results in getting more profits and revenue. In addition to this, it is also helpful to maintain
proper relationship with different people at workplace. In this way, the company can easily make
high profits and revenue easily.
Human resource
Human resource is also important function of Sainsbury. Thus, it is responsibilities of
Sainsbury to make fair and equal treatment with all employees. In this aspect, recruitment,
selection, training and development program of the business is considers effectively. It includes
legislation which can be applicable within the nation through provide equal and proper
management of work (Eberlein, Abbott and Wood, 2014). It is helpful to the cited firm to
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maximise potential customer in company to enhance profits and outcomes at workplace. There
are different types of legislation take place which need to be followed at workplace to protect
UK business such as Data protection Act 1984. In this act, the cited firm need to keep security in
customer data to protect them from exploitation. Hence, the cited firm can easily support to
welfare program of the business. Further, legislation considers Equal rights act 1974 in which the
company need to provide same things to all employees at each level. Hence, they can maintain
sustainability of employee at workplace (Eicher, 2016). This function consist to offers various
profitability through maintains loyalty at within the business. Hence, objectives can be achieve at
workplace easily. With the help of human resources, organisation can easily accomplish their
targets and goals. For example, if the company want to establish their new outlet, then they have
to recruit more people for new ventures. For this purpose, Sainsbury recruit and select new
people so that they make their relations with various people who assist to get proper results and
performances at workplace. According to the objectives and goals, the firm will recruit
employees as per the requirement.
Sales and marketing
Marketing department of the chosen firm assess satisfaction level of customer from
different products and services. This part of every enterprise reviews and investigate market to
operate functions effectively. Hence, customer determines their needs and requirement from
different products and services. Thus, the cited firm can serve their functions accordingly. In this
Sainsbury can also make high profits for developing outcomes of the enterprise (Paton, Chia and
Burt, 2014). The chosen business can satisfy their customer through assessing customer
requirement to produce goods and services accordingly. Sales are mainly responsible to generate
profits of the organisation. Hence, the company can find customer preferences and taste at
workplace. Main aim of the chosen enterprise is to protect customer through satisfying their
needs and requirement. As results, they have involves strategy which can be support to outcomes
of the company. With the help of divisional structure, the chosen firm can involves travelling
sales representatives which done through phone calls, interviews and mails (Foss and Saebi,
2015). In order to enhance sales and profits, Sainsbury should concentrate on their marketing
strategy. For example, recruitment people for marketing the business products. In this aspect, the
chosen business will easily make their direct contact with various people and customer. With the
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help of getting customer feedback, the chosen firm can also maintain their performances and
results in positive aspect.
Research and development
Main aim of research is to increase business profits through improving quality of
products and services. With the help of new production methods, Sainsbury make creative
process which assist to reduce cost and enhance profitability from competition. As results,
Sainsbury can generate profitability from different activities and actions. It can be lead through
allocate specific portion of budget of research and development for enhance company profits
(Dumas and et.al., 2013). In order to attain business objectives, the chosen business can easily
determine customer requirement from research so that they can assign duties and responsibilities
to each member of the company. As results, functions can be develops from activities and
actions which are playing by the organisation. Hence, they can easily support to organisational
structure of the business. In this aspect, to establish new product, business need to carry proper
research of market from different area.
TASK 2
P4 Identify positive and negative impacts the macro environment on business operations
Macro environment consist various factors which can be generates impact on the business
operations (Alon and Herath, 2014). These type of factors are not control by the organisation. As
results, it is highly influence to decisions of the business in effective manner. It can also support
to Sainsbury to operate functions in different new areas. Following macro factors considering
within the chosen organisation to create strategic marketing strategy:
Political factors
Government makes some rules and regulation in every country for the different types of
organisation. All business needs to follow it for development of their operations and influences
to decisions. In UK market taxes is so high which charged by government so that Sainsbury need
to sell their products and services at high prices. As results, costs are increases so that the
organisation cannot easily generate high profits (Lang and Heasman, 2015). Beside this, it can
also maximise social benefits which creates positive impact on the enterprise.
Economic factors
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This factor affect to business activity of Sainsbury through developing profitability at
workplace. There are various changes are take place such as interest rates which can be dispose
income of customer. Thus, it can generate impact on policies, conditions and system which is
very important for each company and their operations (Coomer, 2016). Further, it also generates
positive impact on the company due to determine strategy that can be help to perform various
activities and actions. It includes formulating, implementing and controlling economic policies
which refers as nature and direction within the enterprise. Hence, it can be helpful to operate
functions in systematic manner. In addition to this, it is also helpful to enhance country
operations in term of finance, availability of resources within the nation (What is pestle analysis?
a tool for business analysis, 2017).
Social factors
Different country possesses effective culture and social system in which various
structures, social roles and nature of the business take place. It determines development of social
institution that can be generates profitability and outcomes in effective manner. Customer
changes their taste and preferences continuously so that it is very important to deal according to
their needs. Hence, the enterprise can serve their products and services easily (McCormack and
Johnson, 2016). When Sainsbury create their products and services according to customer needs,
it will generate high profits and positive results through performing functions within the
environment. As results, it can be stated that social factors also generate impact on the business
operations of the organisation.
Technological factors
Technological environment consist those factors which are related to knowledge which
can be applied on material and machine to produce products and services. In respect to this,
production of goods and services can be including within the enterprise which determines
through technology in term of company, cost of technology, collaboration and external sources,
etc. It can be generates positive results in term of making strong value, production and
employment opportunities, etc. (Bajgoric, 2014). Advance technology assist to produce products
in effective manner so that Sainsbury can easily attract potential customer. Apart from this, it is
also generates negative impact due to high cost in production.
Legal factor
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Legal factors are refers as laws and regulations which make by government within the
country. Sainsbury needs to operate their functions through create awareness regarding laws and
regulation. As results, the company can maintain their operations and transaction in effective
manner. In addition to this, government also generates high impact because operations are
requires in each activity and flexibility in marketplace (Polonsky and Waller, 2014). With the
help of these things, Sainsbury can enhance their profits and outcomes at workplace.
Environmental factors
There are two types of environment which can be creates impact on the business operations. It
includes internal and external environment within the enterprise. In internal environment
employees, policies and system of the business can create major impact on Sainsbury so that they
have to support it very carefully to enhance productivity (Hattam, 2014). With the help of
effective working environment to employee so that they will able to develop outcomes and
relations within the business environment. Further, Sainsbury also maintain their relations with
suppliers so that they will get raw-material on time at low cost.
P5 Internal and external environment analysis for the chosen organisation
Sainsbury is operating functions in public sector so that they have ability to examine
internal and external strength and weaknesses. It is very important to analysis internal and
external environment very carefully. Hence, the firm can make high profits through maintain
cooperation to influence success of the enterprise (El Sawy and Pereira, 2013). It determines
information which are essential for different occasions, patterns, trends and relationship that
could be related with internal and external parameter. Following internal and external analysis
can be considers within the enterprise to assess strength and weaknesses:
Internal analysis
It is very important to analysis within the business performances. It can be done through
interaction between workers, employee and other member, etc. In respect to this, interview and
survey can be used which determines strength and weaknesses of the company. Sainsbury is very
complex enterprise which has to make changes within the business environment. Hence, it is
very important to consist of changes which are beneficial to assess internal environment (Naylor,
2014). It can be generates direct impact on the company because these are in internal part of the
business. These are controllable by the company so that they have to alter and modified it very
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carefully within the enterprise. Further, it is also makes physical facilities which are very
important to operate functions in effective manner.
External analysis
External analysis play a very important role within the enterprise so that it can be support
to long term plan of company. It determines to control the business activity which ascertain from
different activities and actions (Alon and Herath, 2014). External environment consist from
micro and macro analysis so that operations of the company need to be assess through
conducting survey at workplace. External environment consist dynamic sources which can be
support to competencies of external environment. Market study can be consisting in it which
assist to maximise profits and support to various activities. Sainsbury can also correlate with
study that enhances profitability and positive results at workplace.
With the help of internal and external analysis following strength and weaknesses can be
measure in Sainsbury to operate functions:
Strength
The chosen business has following strength in internal and external analysis Quality human resources: With the help of store chain, it is understands that human
resources' management invest more amount in order to train staff member. In this aspect,
staff training consist very important investment to improves quality of human resource
(van Buuren, Koch and Wright, 2014). Quality staff provides effective services to
customer which enhance customer satisfaction within the business environment.
 IT infrastructure: Sainsbury is organises various importance to reach in wide market so
that it is very wide platform of internet. With the help of online checkout system, the
cited firm can increase their sales in grocery products and services with promotional
strategy. Hence, convenience stores are enables to earn revenue through recognised
retailer award in every year (Woodside, 2015).
Weaknesses
Following weaknesses are assesses from internal and external analysis within the market: Lack of extension plan: Sainsbury has not effective system so that they are unable to
extend their plan. Further, it can be influence to decision process because it is based on
mission and objectives which need to be support for each and every activity at workplace.
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 Older organisation: Sainsbury is very oldest organisation so that they are also unable to
introduced changes within the organisation. Hence, it will generate problems to make
changes with new and promising strategies (Manikandan and Ramachandran, 2015).
P6 SWOT analysis to identify key strength and weaknesses within the enterprise
Internal and external analysis contains important part within the organisation to assess
strength and weaknesses of the firm. Following is the SWOT analysis of company:
 Strength: Sainsbury is the largest retailer organisation in UK market. Their share is
almost 16% high from other organisation and they are serves more than 90 million
customer in every week. They have high range of products and services around the world
(Eberlein, Abbott and Wood, 2014). Due to high range of products and services, the
company has good value in customer.
 Weaknesses: The chosen organisation has not extension plans which create problems to
operate functions in retail industry. Thus, it has been proved that it is very complex to the
company to operate functions in different areas of the world (Eicher, 2016). Sainsbury
also operating operations in online stores so that it can be generate technical problems
within the market (Berry, 2017).
 Opportunities: In the UK market low cost products and demanded so that it is
opportunities towards the firm to deals with different aspects. Hence, the cited firm need
to provide low cost products so that Sainsbury can easily attract potential customer.
 Threats: Current economic conditions are not so good so that it can be create major
problems to Sainsbury to determines different range of products within the marketplace.
PESTLE analysis
In Order to conduct PESTLE analysis following factors create major impact on the
business operations:
Political factor
In UK market political stability also take place so that it can be affects to every activity of
the business. At each level, different activities and actions are frames so that central, state and
local bodies make changes in each program which can be generates results to shift in the political
system (Paton, Chia and Burt, 2014). When government charge high taxes, the cited firm need to
pay more amount. As results, it can be generates adverse impact on the company operations.
Hence, the chosen organisation cannot easily develops their operations and functions in nation.
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Economical factor
Rising cost of fuel is the largest economic factor which affect to Sainsbury operations. It
means that supply chain of Sainsbury is affects to produce products due to high price of the
products and services. The global food crisis can also generate negative results which enhance
cost of products and services (Foss and Saebi, 2015).
Social factors
Expanding in the opportunities is also part of SWOT analysis which increase social
trends in healthier products and services. Hence, Sainsbury can look towards customer and it will
generate high profits within the market.
Technological factors
It is very essential to use correct technologies in Sainsbury to create positive results
within the environment. As a retailer, there are various things which not possible to done in
effective manner (Dumas and et.al., 2013). Thus, the organisation need to keep their products
and services in upgrade term.
Legal factors
There are various legal issues which create minimum wages policy, avoid discrimination
and fair treatment legislation, etc. Sainsbury pursuing these legislations in different consequence
to maintain legal laws such as competition, employment and many others.
Environment factors
To reduce pollutions from the environment, big companies are a lot emphasize on the
business (Lang and Heasman, 2015). Sainsbury contributes a lot to reduce carbon footprint
which can proves cause for impact on the business environment.
CONCLUSION
From the above report it has been assessed that main aim of Sainsbury is to generate high
profits from different functions and activities. With the help of PESTLE and SWOT analysis, the
company assess their strength, weaknesses, opportunities and threats. It creates ideas to improves
various things within the firm to analysis techniques to generate advantages for development of
new strategies. From the SWOT analysis, it has been analysis that with the help of developing
strategies the cited firm can minimise weaknesses. It gives opportunities to overcome threats
from the market. Further, PESTLE analysis is useful to make strategic plan in term of political,
economical, social, technological, environmental and legal factors.
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