Impact of External Factors on Sainsbury's Business Expansion in China

This report provides an analysis of Sainsbury's business strategy, focusing on its potential expansion into the Chinese market. The report employs a PESTLE analysis, examining the political, economic, social, technological, environmental, and legal factors that could impact Sainsbury's operations. The analysis considers the Chinese government's role in economic development, the country's diverse economy, cultural and social factors influencing consumer behavior, the rapid technological advancements, environmental regulations, and legal frameworks. The report highlights how Sainsbury's can adapt its strategies to navigate the external environment, considering factors such as online trading, consumer purchasing power, and environmental protection. The conclusion emphasizes the importance of understanding and adapting to these external factors to ensure successful business expansion.

Individuals in Society

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................3
REFERENCES ...............................................................................................................................4

INTRODUCTION
For a business organisation, it is required to analyse impact of external factors while
diversify in new and target market. This process helps to make effective strategy to reduce
negative impacts of these factors (Nakassis, 2013). External environmental elements are beyond
the control, so for this firm requires to make appropriate plan minimise its impact. This report is
based on Sainsbury which is second largest chain of supermarket. This organisation was
established in the year of 1869 by John James Sainsbury. This organisation wants to diversify
their business activities in chines market. For this, they require to analyse impact of external
environment factor on their business activities.
MAIN BODY
Political factors – Government of china provide their effective contribution in economy
development and growth. They regulate different rules and legislation for different organisational
sector that requires to implement to getting desirable outcomes easily. For Sainsbury, it will be
beneficial if they precede conventional and casual rules of china in business activities. This
organisation provide their products and services through online procedure and in China
government also perused e-commerce activities to enhance trading process in china. These
activities will be beneficial for economy development and growth as well. These online activities
will be helpful for Sainsbury if they provide their effective contribution to expand online services
in Chinese market with new development strategies in China. These activities maximise
knowledge knowledge of local individual for the uses of online treading procedure.
Economical factors – China is determine as one of the most diversify nation. For them it
is require to develop small and medium size organisations in their country that helps to provide
their effective and valuable contribution in economy development and growth as well. So for
this, diversified business activities of Salisbury can be a beneficial move for organisation as well
as China (Ariely and Jones, 2012). Through this, they can easily maximise purchasing power of
customers by providing attractive and cost effective services to them. In china, some of the
factors will helping to earn higher profit and growth as minimum labour cost, skilled employees,
attractiveness of new online procedure and some cost effective techniques. All these activities
provide their positive contribution in economy development. In China, there can be some
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negative factor as higher interest rates, inflation and limited funds. These activities affect
negatively because they can not get proper financial support to expand their business in china.
Social factors – For a business organisation, it is require to analyse cultural and social
factors of a country before diversify in different economy. Choice, demand and need of
customers can be different, so for this a firm require to provide them quality product on the bases
of their requirement and need. Salisbury wants to diversify their business activities in Chinese
market, so for them it is require to analyse culture and social factors of China to expand their
business easily in china (Koopmann, 2017). Standard of living, lifestyle of people of china is
very different to others nations. So for this Sainsbury needs to understand customer's
requirement and need to make impactful modification in their products and services. Through
this they can easily provide higher satisfaction to target users. These activities helps to maximise
individual's purchasing power for specific services. Through this firm can easily get higher
growth and desirable incomes.
Technological factors – China is a only country that develop new technology rapidly
rather than other nations. For Salisbury it would be beneficial to expand their business structure
in Chinese market through online services. In this procedure government of china also develop
their new strategies to pursue e-commerce activities in Chinese treading market. Through this
they can easily deal with international buyers and sellers. But currently they requires to make
appropriate modifications in their technological procedure as provide safe online transactions to
customers to maximise their purchasing behaviour through online medium. Digitalisation is
china is very impactful that helps to maximise production services, adopt desirable modifications
and reduce extra wastage to introduce cost effective services to customers. Advance technology
always helps to capture service users eyes toward new and attractive products as well as services.
Environmental factors – For a business organisation, it is require to analyse impact of
environmental factor on customer's buying behaviour and organisational activities. Government
of china regulate strict rules and laws for environmental protection activities. For this, several
organisations requires to implement effective methods to dispose wastages properly that can not
impact negatively on environment of china (Stevenson and et. al., 2015). Sainsbury require to
analyse these kind of regulations and policies before diversify their business in Chinese market.
Through this they can easily expand their business structure in several countries. These activities
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reduce negative impact of these disposal procedure from human and animals. Government of
china regulate strict rules for environment safety process.
Legal factors – Government of a country regulate different legislation and law for
individual or business organisation. These rules are requires to implement effectively in a firm.
For Sainsbury, it is require to work through these regulation to build effectiveness in their
business procedure (Durkheim, 2014). These legislations and law provide legality in an
organisation to easily expand their activities in a specific nation. Sainsbury require to go through
this rules as china has some strict rule for labour law, health and safety rules as well as equality
law that requires to implement properly. These rules needs to be follow by Sainsbury to
smoothly run their business operations and functions.
CONCLUSION
From the above report it has been summarised that an organisation require to analyse
impact of several environmental factor on their business activities while diversify in another
nation. Business environment is classify in two different factors as internal and external. These
factors has several impact on an organisation. Internal factors are controllable while as external
environmental factors are beyond the control, so for this an organisation requires to make
impactful strategy to minimise negative impact of these factors on their organisational activities.
Through this they can easily expand business activities and services in each and every country
properly.
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REFERENCES
Books and Journals
Nakassis, D., 2013. Individuals and society in Mycenaean Pylos. Brill.
Ariely, D. and Jones, S., 2012. The (honest) truth about dishonesty: How we lie to everyone--
especially ourselves (Vol. 336). New York, NY: HarperCollins.
Koopmann, G., 2017. Introduction. In On Crimes and Punishments (pp. 7-8). Routledge.
Stevenson, V.L., and et. al., 2015. The high cost of spasticity in multiple sclerosis to individuals
and society. Multiple Sclerosis Journal. 21(12). pp.1583-1592.
Durkheim, E., 2014. The division of labor in society. Simon and Schuster.
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