Business and Environment Analysis of Sainsbury's (Course Name/Code)

This report provides a comprehensive analysis of Sainsbury's business environment, focusing on the macro environment and strategic positioning. It begins with an introduction to the business environment, defining its key components and their influence on business operations. The report then delves into a PESTEL analysis, examining the political, economic, social, technological, environmental, and legal factors impacting Sainsbury's. It explores both positive and negative influences of each factor, such as political stability, Brexit, unemployment rates, consumer preferences, technological advancements, environmental regulations, and legal frameworks. The report further analyzes Sainsbury's internal and external environment using SWOT analysis, identifying strengths, weaknesses, opportunities, and threats. It also includes a TWOS analysis to explore how the company can leverage its strengths and opportunities to mitigate its weaknesses and threats. The report concludes by summarizing the key findings and providing references to support the analysis.

Business and Business Environment

Table of Content
•Introduction
•Positive and negative impacts the macro environment
•Internal and external analysis
•Conclusion
•References

INTRODUCTION
Business environment refers to an atmosphere in which business enterprises operate
their business activities and operations. It can be sum or collection of all
extrinsic and intrinsic components like workers, consumers, suppliers,
management, owner, government, customer’s needs and expectations, supply and
demand, social needs, market trends and economic changes etc. This assignment
is based on Sainsbury which is the second largest chain of supermarkets in the
UK.

Positive and negative impacts the macro environment
Macro environment refers to the external business
environment in which a company operate its
business to fulfil the needs and demands of the
target audiences.
PESTEL Analysis
It is a tool and method that is used by
organisations to determine the factors and
components of external environment

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Political- This factor consist different aspects like political stability or instability,
taxation policy, corruption, foreign trade policy, tax policy, labour law and trade
restrictions etc.
Positive- In UK, political stability is a factor that can favourably influence the
business of firm like Sainsbury.
Negative- In UK, Brexit is the major component that highly influence the business
if retail sector and affect the company like Sainsbury that operate its business in
business industry.

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Economical- It consider diverse elements like interest rate, currency rate, inflation
and deflation, disposal income of consumers, employment and unemployment
rate, foreign exchange rate and tax rate etc.
Positive- In UK, unemployment rate is constantly rising and this could be pose to be
favourable thing for Sainsbury’s.
Negative- For the transportation of goods and material, Sainsbury is highly
dependent on rod transport.

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Social- This factor consist several aspects like culture, values, beliefs, needs and
demands, tastes and preferences of customers and demographic factors like
age, gender, income, lifestyle, occupation etc.
Positive- In current era, people aspire to shop from a supermarket in which all
needed commodities they can get under one roof.
Negative- In current era, people prefer to online shopping company that deliver
items to their ordered place and offer commodities through discounting
pricing.

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Technology- This factor includes different includes different components like
technological innovation, advancement in technology, artificial intelligence,
research and development and many others.
Positive- This factor positively impact retail sector organisation like Sainsbury
because due to technological innovation, the firm is able to fulfilling the needs
of its target audiences.
Negative- But lack use of technology, in promotion and publishing of goods and
services of the company, can unfavourably affect the firm.

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Environmental- It considers diverse aspects such as climate, weather,
environmental law, like air pollution, water pollution, carbon footprints and
emissions etc.
Positive- Now these days, people of a nation expects an enterprise to be eco-
friendly.
Negative- this factor negatively affect Sainsbury as the firm produce high level of
carbons footprints that is highly affect the current environmental situations.

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Legal- This factor of political analysis consist different laws and legislations that
are framed and developed by the national authority so that business of
organisations can run and operate in effective and efficient manner.
Positive- The administration of Sainsbury appropriately follows employment,
health & safety law and consumer protection act.
Negative-With the familiarisation of new Sugar Tax in UK, the rules and
regulations laid down stopping Sainsbury to stop promoting its high fat, salt
and sugar foods to the children below 16 years of age.

Internal and external analysis
SWOT analysis
It is a strategic analysis that is utilised
by the firms to analyse the strengths,
weaknesses, opportunities and risk of
the company. The brief explanation of
this analysis is mentioned as below:

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Strengths Weaknesses
•The organisation has providing for all
types of customer and there are number
of brand and extensive products
accessible for all higher income
segments.
•The firm utilise innovation promotion
strategy like Brand Match promotion.
•Due to Brexit, inflation is arisen and
the cost of transportation and food
prices arises that unfavourably affect
the company.
•There is rigid rivalry in each section
of the retail sector.