Business Environment Analysis: UK Retail Super Sector Report

This report provides an analysis of the business environment, focusing on the retail super sector in the UK, with specific attention given to Morrisons. The report begins with an overview of the retail super sector, highlighting key factors affecting businesses within this sector, including competition, ...Read More

Business Environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Outline of Retail super sector................................................................................................3
1.2 Key issues in the Business Environment..............................................................................4
TASK 2............................................................................................................................................6
2.1 Outline of Food retailer or wholesalers:................................................................................6
2.2 Impact of micro issue on organisations in Food retailer and Wholesaler sub sector ...........6
CONCLUSIONS..............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business environment include all the factors whether internal i.e. employees, policy
and management or external i.e. government, customer and suppliers which affect the
business and its decision making. It mainly comprises the environment of business
and the effect it is having on the business and its profits. The present report will cover
the key issues related to business environment and that are significant for Morrisons in
retail super sector and sub sector in UK. There are also the problems or challenges in
the Food Retailer and wholesalers under the consumer service and the impact of the
key issues on these. Retail super sector and sub sector is the further division of the
Food retail and wholesale industry in market. Consumer goods are the durable and
non-durable goods which are mainly in direct contact of the end use consumer in his
day to day life. Including the household good, food items, leisure goods and personal
goods used by the consumer directly for his own benefit.
TASK 1
1.1 Outline of Retail super sector
The business environment of the Retailer and wholesaler in UK are very
deviser in Food retail and wholesale industry. Which include suppliers, government,
owners, management, staff, consumers and competitors. These all lay effect on the
profits and the decision making of the company and the industry (Charter, 2017). In
UK's marketing style self-service supermarkets arrived in the 1960's which totally
changed the British shopping experience of the consumer. Moreover, in today's
scenario this is much changing the buying habits of consumer in UK and the grocers
are impacted to rethink their business model once again. Wm Morrison super market
is the fourth largest supermarket chain in UK with the headquarter are Bradford
England. The supermarket is present in whole of South England, Wales and Scotland
with about 500 stores across UK. The supermarket is offering a number of products to
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daily customers including food and drink, clothing, books, magazines etc., Morrison is
also having online store and the vertical integration of the supermarket across UK.
1.2 Key issues in the Business Environment.
But as of now Morrison and including the big supermarkets like Tesco and
Sainsbury are all losing their larger share of market and profitability in the share price
since last 4-5 years. As Walmart being the biggest in this industry is just snapping the
major rivals in UK market (Dwyer, Čorak and Tomljenović, 2017). And is taking the
major share of market of supermarket around the world as well. There are bigger
challenges faced by Morrison in the industry as the rise of supermarket and more and
more increase of Online stores in UK is also making Morrison to sink. There are many
other issues related to the business environment like new emerging local supermarkets
of UK.
 Competitors- these are the most important and bigger challenges faced by
Morrison at all times. The competitors include Tesco and Sainsbury who are
regarded as the bigger market share of the industry. And government has also
made the regulation regarding the merger and acquisition of the supermarket or
wholesaler in industry. The competitors are also increasing in the form of small
local supermarket which are also gaining the market share of Morrison to a
great extent. As supermarket are very easy to start the business this is also
attracting many to jump in the industry.
 Discounters rise and price sink- There are many in the market who all are
offering the discount to the customers and making them more attracted towards
their business. These discount are making the price of Morrison to decrease and
sink in the coming time. This is not only affecting the loss of sale but also
Morrison is forced to cut down its price of goods on daily bases. This price war
is decreasing price and profit margin of Morrison which is surely not a good
sign.
 Online Stores- This is nowadays the biggest and the greatest issue of business
environment which is affecting almost all the physical store of the world.
Today online market is almost providing all the basics to complex goods to the
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door steps of consumer (Pun and Yiu, 2017). Morrison has also started its
online delivery services but this is not enough to meet the challenges in the
market. So, Morrison has now installed coffee shops, restaurants and gyms to
make the store more attractive but this is adding up in the cost of the
supermarket rather than increase in sales.
 Consumer Preference- Online supermarket is also preferred by the consumers
and they are now shifting their preference to online stores rather than the
physical stores (Dave and Dave, 2017). As the fashion or the clothing markets
are growing in terms of online stores and the change in the technology is also
affecting Morrison's sale and profit margin.
These all are the key issues which have been faced by Morrison in the industry
are decreasing the sale and profit margin as well. To decrease these issues of business
environment Morrison, need to work more on the business planning of the company
so as to increase the customer loyalty. Business environment as is very wide in its
context and the government policy regarding Morrison or retailers and wholesaler are
not so much strict which is the only plus point in this industry. Morrison is also
planning to increase its stores in UK and outside UK which need to be looked as the
opportunity and to grab it.
It can do much better in its online stores and use the technology more so that
the consumers are attracted to them and the problem or the issue is solved at their end
only. These all the issues affect the retail super sector or sub sector as a whole and are
significant in the growth and development of the business (Mole. North and Baldock,
2017). Morrison is also affected by this and which is important for it and this will
build the trust between the customer and the staff of Morrison. If the issues are
resolved than this will prove good for them and the increased in sales and profit
margin.
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TASK 2
2.1 Outline of Food retailer or wholesalers:
The micro or internal environment of the food retailer and wholesaler sub
sector include management, policy, owner and staff members of the company. They
all affect the sector, its profit and the company as whole. For example, if some day
there is staff shortage in supermarket then this will hamper the customer service on
that day (Farias, Hasti and Mesquita, 2017). And if there is a certain change in the
policy of the company or that of the industry then this will also affect working. Food
retailer and wholesaler include all the retail and whole sell business in the economy
which is basically food or drink related. All the small grocery stores, supermarkets
and the wholesale shops in the market and the economy selling all types of consumer
durable and non durable products which the customer use on a daily bases. And in
today's scenario these retail and wholesale businesses are growing in the economy of
UK at very fast pace.
2.2 Impact of micro issue on organisations in Food retailer and Wholesaler sub sector
The micro factor like the employees and the policy are effecting the food retail
and wholesale business to a great extent as they effect the sale and profit margin of the
company (Lüdeke-Freund and etal., 2017). Because of a good quality of staff only
they will be able to grab the share of market and increase the profit or customer will
be satisfied by this only. The supermarket is also giving employment growth
opportunity to the people in the economy and this is because the contribution of the
retail and wholesale business in the market. The key or important issues relating to
food retailer and wholesaler sub sector will be as follows:
 Management- they are the one who make and set the policy and rules
regarding the food retail and wholesale company. They are the policy maker of
the company like the payment method and the security issues are the main
issue looked after the management. If there is any issue in the management
process or the policy maker then this will affect the profit and the sale of the
company on a larger context. If the company says that most of the payment
should be made by debit or credit card then they need more and more swiping
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machines (Kolk and Tsang, 2017). This will affect the sales and thus affecting
the profit of food retail and wholesale company.
 Policy- this is generally framed by the top management of the company and
thus have an impact on the company in the sector. Policy regarding the
discounts offered by company, regarding the leave of the employee, regarding
the mode of payment and the security issue. These all policy will affect the
food retail and wholesale company. Policy are included in the micro or the
internal factor of business environment of any organisation as they are the
internal part of the company. They affect the whole working of the company
and that too at all levels whether it be sales department, technical department or
the accounting clerks. Policy of food retail and wholesale must be very good
and flexible as this industry is very dynamic in nature and need to be
formulated time to time. All the old age policy will not work in the present
scenario (Breuer and Lüdeke-Freund, 2017). The company should make the
policy regarding the online buying and selling of the products of supermarket
so that the company could make them available at the door step of the
customer. A good policy will be effective for both staff retention and the
customer satisfaction or customer loyalty.
 Staff Members- they are the main essence of any industry staff are a crucial
resource any industry or any company is having with them. Without the staff
company will not be able to perform. They can also be the main issue in the
business environment of food retailer and wholesaler business. If management
make the plan or policy they are the one who actually implement the policy.
Staff contribute in the increase in sale and profits of food retailer and
wholesaler and also in increase in customer retention (Pun and Yiu, 2017).
Customers are satisfied with the staff then they will surly maintain the loyalty
with that food retailer and wholesaler.
 Owner- he is the one person who responsible for the working and the setting
up of the food retail and wholesale business and actually the policy maker as
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well. The owner also has the impact on the organisation as is one of the internal
factor affecting the food retail and wholesale.
CONCLUSIONS
From the above report it is concluded that business environment is made up of
two factors namely micro and macro environment and these both effect on profit and
sales of the company in a good deal of sense. Morrison is the supermarket operating in
UK and surrounding areas. It is the fourth largest supermarket in UK in terms of profit
and is growing very fast. The consumer preference and technology are the main issues
relating to business environment and they hamper or foster the growth pattern of the
company. Supermarket is that form of shopping destination in which customer can get
everything which they require on daily bases under one roof.
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REFERENCES
Books and journals:
Breuer, H. and Lüdeke-Freund, F., 2017. Values-based network and business model
innovation. International Journal of Innovation Management, 21(03),
p.1750028.
Charter, M. ed., 2017. Greener marketing: A responsible approach to business.
Routledge.
Dave, B. and Dave, B., 2017. Business process management–a construction case
study. Construction Innovation, 17(1), pp.50-67.
Dwyer, L., Čorak, S. and Tomljenović, R., 2017. Introduction. In Evolution of
Destination Planning and Strategy (pp. 1-14). Springer International
Publishing.
Farias, C., Hastie, P. A. and Mesquita, I., 2017. Towards a more equitable and
inclusive learning environment in sport education: Results of an action
research-based intervention. Sport, Education and Society, 22(4), pp.460-476.
Kolk, A. and Tsang, S., 2017. Co-evolution in relation to small cars and sustainability
in China: Interactions between central and local governments, and with
business. Business & Society, 56(4), pp.576-616.
Lüdeke-Freund, F., and etal., 2017. Sustainability-Oriented Business Model
Assessment—A Conceptual Foundation. In Analytics, Innovation, and
Excellence-Driven Enterprise Sustainability (pp. 169-206). Palgrave
Macmillan US.
Mok, K. Y., and etnl., 2017. Investigating key challenges in major public engineering
projects by a network-theory based analysis of stakeholder concerns: A case
study. International Journal of Project Management, 35(1), pp.78-94.
Mole, K., North, D. and Baldock, R., 2017. Which SMEs seek external support?
Business characteristics, management behaviour and external influences in a
contingency approach. Environment and Planning C: Politics and Space,
35(3), pp.476-499.
Pun, K. F. and Yiu, M. Y. R., 2017. Assessing organisational KM performance based
on the criteria of total quality management. In Decision Management:
Concepts, Methodologies, Tools, and Applications (pp. 1663-1684). IGI
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Online
Impact of super market in UK. 2017 [Online] Accessed through
<https://www.google.co.uk/search?
q=Big+problems+for+BritainbKhIJlAlFRF6UYGoRr916q3Yw4rwqEgm2cW
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