Comprehensive Business Environment Analysis of Sainsbury's in the UK

This report provides a comprehensive analysis of Sainsbury's business environment, focusing on internal and external factors impacting its operations. It begins with an introduction to the business environment, followed by an examination of the relationships between various organizational functions within Sainsbury's, including human resources, marketing, finance, and production. The report then delves into the positive and negative impacts of the macro environment, considering political, economic, social, technological, legal, and environmental factors (PESTLE analysis). Furthermore, it presents an internal and external analysis using SWOT analysis, identifying Sainsbury's strengths, weaknesses, opportunities, and threats. The report concludes with a summary of findings and references. This report, contributed by a student, offers valuable insights into Sainsbury's strategic positioning and its response to the dynamic UK retail market. It examines the firm's structure, objectives, and how it adapts to the ever-changing external environment. It also looks at how various departments, such as HR, marketing, finance, and production, contribute to the overall success of Sainsbury's in the UK market.

BUSINESS ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1...........................................................................................................................................1
Covered in PPT...........................................................................................................................1
TASK 2............................................................................................................................................1
P3 Relationship between various organisational functions.........................................................1
TASK 3............................................................................................................................................3
P4 Positive and negative impacts the macro environment..........................................................3
P5 Internal and external analysis of particular organisations......................................................6
P6 Strengths and weaknesses interrelate with external macro factors........................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Business environment is sum total of internal and external factors which impact on
business. It is a set of political, legal, institutional, economical and social conditions which are
uncontrollable and also impacts functions of company. In this business environment, there is an
effective contribution of various external and internal and their factors affect on performance
level of firm. It identifies various business which will successful in an environment. This present
report is based on Sainsbury organisation which is a supermarket chains in United Kingdom.
This firm is the largest retailer of grocery products. Sainsbury plc is public organisation and it
split in to the three different division and these are Sainsbury Argos, bank and supermarkets. In
this given report mentions about the purposes of the various kinds of organisations (Bagtasos,
2011). Relationship among the various functions of firm and they are related to organisational
structure and objectives will be discussed under this given report. There will be discussion about
the negative and positive affects that macro environment has on operations of business. The
external as well as internal analysis of particular business firms in context to determine
weaknesses and strengths will be mentions under given report in an effective manner.
TASK 1
Covered in PPT
TASK 2
P3 Relationship between various organisational functions
Sainsbury business firm has better control over the activities as well as operations which
can affect in performance level of firm. Objectives of this companies are helpful to management
of all functions of business firm which impacts on structure of firm. In order to accomplish better
brand positioning, this organisation making its efforts with the help of expanding its all business
related operations and accomplishing aims of business. It considers various aspects concerned to
macro environment and also its necessary factors (Bhaduri and Ha-Brookshire, 2011). Sainsbury
company works at international level with different functions like for an instance operations,
marketing, finance, human resource, production and many others. In addition to this, functions of
the different department are interlinked with the each other and impact on organisational
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performance. Interrelation among the departments link with objectives and structure given below
as above:
Human resource department- This firm plays an important role in enhancing
productivity as well as growth of firm. The functions of this department are hiring, selecting,
training and development, payroll, performance appraisal and many others. The main objectives
of this firm is to increasing productivity and also provide better quality of services and products
to consumers in order top fulfil their needs (Budhwar and Debrah, 2013.). So, in regards to this,
HR manager hire only those employees whose skills, competencies are good and have better
knowledge. It is helpful in enhance efficiency and effectiveness of operations of firm and get
better outcomes. This department provides training to marketing employees in order to improve
their different skills.
Marketing department- It promotes business and also drive sales of goods and services.
It gives essential research in order to determine target consumers and also other audiences. This
department uses different communication modes in order to communicate with the target
audiences. With the help of effective tools, company can interact with customers and alos
provide all information and details regarding the products. Its main motive to enhance sales as
well as earn profit level.
Finance department- The functions of this department are reporting, prepare financial
planning, long term as well as short term strategy etc. This department prepares the different
budgets and also fund allocations to the different department of Sainsbury company. The
manager of finance arrange funds on the basis of activities. If proper fund will be for activities
then in this can all other functions can implement their functions in a better or proper manner.
Production department- The main aim of this function is to manufacture goods on the
basis of demands of consumers which can fulfil their needs in a better manner (Bovee and et. al.,
2016). For production, Sainsbury firm uses new and advanced technology in its business.
Research and development- This department investigates activities which company
performs in context to improve present process and products or produce new goods. This
department conduct research and know about the consumer tastes, preferences, existing products,
marketing strategy etc. so that Sainsbury company can focus on these factors and perform in a
better manner by considering all these functions.
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Organisational structure- It refers to activities like for an instance task allocation, supervision,
coordination towards achieving aims of firm with in given time period. The organisation
structure are segmented on basis of:
Function based- This structure includes activities like for an instance supervision,
allocation of task and coordination. It is helpful in identifying that in which manner form
operates as well as performs its business (Cassell and Blake, 2012). Marketing, human resource
and finance are major basis of this segmentation. All different departments work on achieving
aims a d objectives of firm.
Consumer based structure- Under this, some industries will organise through type of
consumers and it is done in effort to assure particular expectations of consumers. This kind of
structure is specialised in fulfil needs of every group customers.
Matrix organisation structure- It employees through products and functions both are
combination of both structure. This structure uses employees teams in order to achieve works
and take effective benefits. Staff members are main part of function group but serve on team
which support the new product development.
TASK 3
P4 Positive and negative impacts the macro environment
As Sainsbury is retail business firm and it operates its business activities at large scale.
There are several external factors which impacts on functions of this business firms. Macro
environment factors are uncontrollable factors and affect organisational functions. Variation in
component affect the business related operations in a negative or positive manner. The main
factors which are includes in macro environment are political, environmental, social,
technological, legal and economical (Cavalcante, Kesting and Ulhøi, 2011). Sainsbury business
organisation develop effective business policies as well as plans in order to achieving aims and
firm. The negative and positive affect of external factors which can impact on the business
activities given below as above:
Political factor- It consists political implications on functions of business firm. Under this,
government develops some regulation and policies. Under this government policy impacts
functions of firm through giving acts as well as regulations. The main factors which affect
activities of firm are import and export duties, excise duties etc.
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Positive impacts:
 It is helpful in determining necessary regulations of government and gives
business stability.
 The government of United Kingdom provides restrictions on unfair trade control
and practices of firm.
Negative impacts:
 The political factors interfere in activities of business which gives barriers to free
practice functions of business.
 Due to instability of political factors, Sainsbury firm faces inconsistency.
Economical impacts- In each business firm, there is better affect on economy of United
Kingdom. These factors consist supply and demand of an economic which impacts on functions
of firm and also various economic modifications in an economy (Charter, 2017).
Positive affects
 Through this, business functions of Sainsbury company are regularly shows an
economic changes, supply and demand which assess to determine functions and
requirements.
 Impact on spending power and profitability of consumers.
Negative impacts
 It gives deflation and inflation which can influences in an activity of firm.
 Sainsbury firm faced an economic slowdown.
Social factors- These factors include wealth, lifestyle and also religion of persons which are
living in society but some times their culture impact on functions of business and marketing
related strategy of an organisation. It is essential that firm should produce goods according to
needs and preferences of people.
Positive impacts:
 Helpful in enhance diversity of goods in business firm.
 Bring innovation through which firm can make improvement in its business (.
Cheng and et. al., 2012).
Negative impacts:
 This factor brings restrictions for firm to operates on the basis of different culture
and religion.
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 Rigid to accept rapid changing behaviour.
Technological factor- It is related to change in technology for make improvement in business
operations. Adopt and use new technology develop positive impact on business. The production
department adopts new technology for improving quality of products and service in an effective
manner (Cronan and et. al., 2011).
Positive impacts:
 Improve quality of goods
 Make improvement in performance level of firm.
Negative impacts:
 Enhanced cost and also complexities on business operations.
 From new technology, functions of company get disturbed.
Legal factors- Under this, various legislations and tax laws are included which are implements
on functions of business like for an instance manufacturing, sales and purchasing. All these
functions are impacted through legal factors. Sainsbury company execute all legislations at
workplace in an effective manner.
Positive impacts:
 It is helpful in minimising inconsistency in firm and gives stability of business.
 It gives prevention from an excessive corruptions.
Negative affects:
 It increases production cost of Sainsbury organisation.
 It is time consuming because if law will be change then firm needs to be change
in its functions.
Environmental factors- Sainsbury is retail business firm and it impacted with changes in
environmental situations (David, 2011). This factor consists biological changes in an
environment and impact functions of firm. Environmental changes like for an instance disasters,
seasons and pollution affect on functions of business.
Positive impacts:
 It is helpful in developing risk preventive actions.
 Seasonal modifications which make affect on demand of goods.
Negative impacts:
 Unavailability of proper resources.
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TASK 4
P5 Internal and external analysis of particular organisations
Internal as well external analysis are assess in identifying all forces which can develop
negative affect on abusiveness operations (Meiners and et. al., 2012). Internal analysis of
business firm are those which evaluates and analysis impact of these factors. Firm can control
internal factors in an each manner and in this SWOT (Strengths, Weaknesses, Opportunities and
Threats) analysis are included. Internal analysis is helpful in improving weaknesses of firm and
on the other hand in external factors PESTLE Analysis is included. SWOT Analysis of
Sainsbury organisation given below as above:
Strengths Weaknesses
 This firm has four largest chain of
supermarket sin United Kingdom.
 Excellent advertising and branding.
 The customers of this organisation are
loyal towards firm.
 Its leadership team is more
experienced.
 Sainsbury has more than the 550
supermarkets and over 350 stores in
United Kingdom.
 Strong competition with each segment
in retail sector.
 Increasing food costs in all over the
world.
 Complexities related to searching staff
members with skilled and competitive
qualities.
Opportunities Threats
 This firm can get better opportunity to
do online marketing (Pikka and et. al.,
2011).
 Can enter in to the emerging firms.
 It can open its stores for 24 hours to
increase sales.
 Enhancing globalisation develops a
challenges for firm.
 More competition.
PESTLE ANALYSIS of Sainsbury
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Factors Analysis
Political  The political relations of United Kingdom with Qatar affect business
of Sainsbury.
 Brexit have implications for the businesses.
 Enhanced globalisation can give challenge and chance to Sainsbury.
Economical  Steep reduction in GBP after impact on earning of Brexit.
 Increasing fuel costs impact on Sainsbury firm.
Social  Longevity in population, enhancing female workforce has resulted in
minimise domestic making ( Rose and et. al., 2013).
 Enhancing demand for an organic food.
Technological  Use of advanced technology affect on functions and operations of
firm.
Legal  Government approvals can delay in the business growth as well as
decision making.
 Government policies can affect on performance level of firm.
Environmental  Minimisation of recycling and operational wastage.
 Minimisation of the carbon emissions.
P6 Strengths and weaknesses interrelate with external macro factors
Management of Sainsbury firm conduct PEST analysis in order to acknowledge market
environment or conditions under which business conducted. It is essential for manager to use
strengths in order to utilise market opportunities and get over from threats and weaknesses.
External factors are mention below which examined through determine weaknesses and
strengths:
Political factors- It is essential that manager should work on the basis of rules and policies of
government at workplace (Sass and Fifekova, 2011). Government of United Kingdom develops
effective legislation top protect rights of people.
Strengths: Sainsbury firm has well established team which provide better guidance to
employees. It increase image of firm.
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Weakness: Sainsbury company operates its business in many countries, so there is a need
to manager to develop policies accordingly.
Economic factors: Inflation, deflation, interests and also exchange rates are the different
components which can affect on the business activities. So in context to this it is essential that
firm should have accurate funds which are available (Scheer, 2012). Sainsbury company
operating its business in different countries by determining economy of different nations.
Strengths: This company need to enlarge business activities in the different countries on
the basis of their situations.
Weakness: Various nations have enhance exchange and interest rates so that
administration can need to make functions of firm.
Social factors: It is a duty of an organisation to provide better qualities of services and goods on
the basis of needs of customers. Sainsbury work on attracting large number of consumers and
provide better quality of goods.
Strengths: The image as well as reputation of firm will be increase and conduct CSR.
Weakness: There is a requirement to administration to work on effective quality and
decline in the position of firm.
Technological factors: Sainsbury firm provides advanced effective technology to provide
quality services and goods to people and increase work effectiveness (Turban, Sharda and Delen,
2011).
Strengths: If company will use advanced technology, then administration will use better
resources to produce unique goods.
Weakness: Firm needs to make changes in technologies on the basis of market
conditions.
CONCLUSION
It has been concluded from the above given report that business environment plays a
necessary role in an organisation. It is necessary that firm should determine all those factors
which develops negative impact on business. Under this mention report studied regarding
relationship among different functions of firms and they are related with organisational structure
as well as objectives. Various kinds of organisations and their purposes are studied in mention
report. The firm can control internal factors but can not control and managed the external factors.
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In given report, studied about positive as well as negative affects that are on operations of micro
environment .
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