Assignment on Business Environment Primark

Assignment on Business Environment Primark

Assignment on Business Environment Primark


Diploma in Business

Unit Number and Title

Assignment on Business Environment Primark

QFC Level

Level 5


This assignment business environment primark is prepared in relation with business environment which will provide information regarding internal as well as external forces which have a huge impact on the processing of the business. Information regarding demand and supply will be shared to help the organization in making decision. Report includes information related with European Union and various aspects attached with the union that helps the business to function smoothly in the market. Information regarding international trade will be shared as it will provide information to the businesses to broaden their scope to grow in the global market and to attain competitive advantage in the same. For better understanding information related with Primark is being shared in this report. Primark is a Irish clothing retailer operating in Austria, Belgium, France, Germany, Ireland, Portugal, Spain, Netherland, the United States, United Kingdom and Italy. Company was founded in 1969 by Arthur Ryan. Company generated revenue of 5.347 billion in 2015. For a company like Primark it is necessary to develop effective set of strategies. Analysis of the business environment will help the company to gain proper set of information regarding internal as well as external environment of the market will help the company to prepare the plans to sustain in the market.

HND Assignment on Business Environment Primark

Task 1

1.1Identify what type of organization is Primark and discuss its purpose. In addition identify and discuss the purpose of one organization within the following categories;

a. The public sector

b. Charity

c. Cooperative

There are various categories in which companies are divided, division of these companies are done on the basis of legal structures. Some of the categories are:

  • Sole Traders: These are the organizations which are owned and managed by the single owner. Sole trader is one of the most common types of organizations in UK.
  • Limited Company: The companies which are run by the shareholders from whom board of directors are being appointed so as to manage the functions of the company. Limited companies are bifurcated into two categories i.e. private and public limited company. In which public companies do not offers the shared to general public on the other hand Public limited companies avails the shares to the general public (Jones, et. al., 2009).
  • Partnership: This is the firm in which there could be two or more owners who have the authority to run the business. Profit is being shared on the basis of the agreement signed by the partners.
  • Franchise: Franchise avail the right to use a firm’s business model and brand for the agreed period of time (Coker, et. al., 2016).
  • Cooperative: Public co-operations comes together to form a company which helps in fulfilling the basic needs of the society.

Understanding the case study it could be analyzed that Primark is a private limited company, because there is no involvement of public in the shares of the company.

Purpose and Objectives of the Company

Company’s values suggest the purpose and objectives of the company. Company acts as the mediator between manufacturers and customers. Production of the required goods and services are not done by the company, either it outsource the goods and services of standard quality from others. Company has the standards of maintaining the ethics for which it ensures that employees working in the company should work in good as well as ethical environment (Valentinov, 2015). Company focuses on CSR which includes:

  • Public Sector (National Health Services NHS): Vision statement of the company is to develop a healthy community, mission statement is to provide sustainable and healthy environment to the people by taking the help of joint ownership with other organizations working for providing health services in UK.
  • Charity (British Red Cross): Vision statement of the company is to support the people in need in the emergency situation. Company provides advice to the people on how to overcome from the dilemma and fight with the emergency situation.
  • Cooperative (Daily Bread Cooperative): It has the specialisation in packaging and selling whole foods, company holds the responsibility of fair trade with the companies working in the area of whole food (Treiger, 2015).

1.2 Describe the extent to which Primark meets the objectives of its different stakeholders.

Stakeholders are the interested parties who are directly or indirectly remain associated with the company. Stakeholders are one of the most important parts of the organization; Primark has both internal as well as external stakeholders. Stakeholders of Primark are owner and employees, customers, shareholders, suppliers and manufacturers (Everaert, et. al., 2015). For a company it becomes necessary that objectives of the stakeholders should get fulfilled for the smooth flow of the business.





Employees are one of the most important stakeholders of the Primark. They manage all the works of the company and ensure that all the products and services could be delivered on time in the market.  

Objective of Primark is to provide job security as well as job satisfaction to the employees. Pay of the employees is also being taken into consideration by Primark which is provided according to their performance.


Suppliers are the stakeholders who manage the supplies of goods and services to Primark. Primark do not manufacture own goods and services so it becomes necessary to take care of the needs and requirements of the suppliers.

Primark ensures that fair deal could be provided to the suppliers. It takes care of the contract that is formed between the supplier and the company and provides the deal accordingly (Kim, et. al., 2016).


Customers are the stakeholders for whom company works and by whom company is being run. Fulfilling the needs and requirements of the customers is one of the most important aspects for Primark.

To fulfill the objectives of customers Primark ensures that they should get quality product at fair price so that they could remain satisfied and prefer to choose the products of the company.


Workers are the key players of the company as they work with the suppliers as well as with the manufacturers to fulfill the requirements of the company (Wood, et. al., 2016).

To meet the objectives of the workers Primark introduced CSR policies which include policies regarding health and safety of the workers as well as managing the standard of the living of the same.

1.2Explain the responsibilities of Primark as an organization and the strategies employed to meet them.

Primark has various set of responsibilities which should be followed by it as an organization. Helping the stakeholders in achieving their objectives is not only the responsibility that is being managed by the company but it has to consider the society as a whole and should try to develop the strategies to work towards the interest of the society. Certain responsibilities of an organization in general are managing the conflicts at workplace, helping the stakeholders to meet their targeted objectives and protecting the interest of the stakeholders. There are certain legal responsibilities also such as maintaining the health and safety to ensure that employees working in the organization could remain safe, reducing discrimination, adopting fair practices, conducting CSR activities and dealing fairly in the market.

Primark’s Responsibilities

  • There are certain set of responsibilities that Primark has towards it stakeholders. It is necessary that Primark should fulfil the needs and wants of the stakeholders attached with the company. Primark has the responsibility to pay the return to the stakeholders according to the capital that company share. Organisation is also responsible for providing fair pay and job satisfaction to the workforce.
  • Another responsibility of Primark is to develop the policies which are concerned with the legislation. It should ensure to work on the illegal activities and try to bring the policies which could help in reducing these activities (Jurigová, 2016). Organisation should try to adopt fair practices because any fraud is a punishable offence by the judiciary.
  • Another responsibility that should be taken care of by Primark is responsibility towards the society. Organisation should try to contribute in the development of the society in which it is doing the business. Organisation will have to adopt the CSR activities to protect the interest of the society and to help it to grow in the market.

Primark’s Strategies
To maintain the value of the conduct many programs were introduced by the company. Company developed the policies which include that all the employees as well as workers should be treated equally, and should get fair pay as well as wages.

To maintain the dignity of the company organizations values all the ethical practices, it is necessary that Primark should adopt the CSR programs so that it could apply the ethical practices at workplace. To match up with the ethical objectives it is necessary Primark should work on HER project. In Bangladesh project is launched to educate the women workers about the importance of health and hygiene in life. Such type of activity helps in spreading awareness regarding the health and hygiene which helps in transferring the knowledge to the family of workers which finally reaches to the society.

Task 2

2.1 Different countries operate different economic systems to attempt to allocate resources effectively. Research and explain the type of system operated in the following countries and reasons why you think they follow these systems.

a. Cuba

b. United Kingdom

c. China

Majorly there are three types of economic systems that can be adopted by the countries to allocate the resources in a proper manner. Adopting the economic system helps in providing proper set of framework which helps the organization in allocation of resources according to their requirements. Different economic systems are used by different companies which suits their market conditions and the business position in world economy. Some of the main economic systems are planned economy, free market economic system and mixed economy (Zirra, 2015).

There are certain questions which are answered by these economic systems they are what goods and services should be produced, how they should be produced, and for whom those goods and services should be produced. Gaining information with the countries falling in different economies will help in developing better understanding various economic systems:

  • Cuba: Planned economic system is being followed by Cuba. Planned economic system has the involvement of the government. It is the system in which most of the businesses are governed by the government of the country. In this major decision related with the production, exports and imports are taken by the government. Reason behind Cuba is following the planned system is that business of the country is dominated by the state organisation (Jovanovic, 2015). There are various industries in Cuba that are owned and run by the government. With the comparison between public sector and private sectors of Cuba it was being observed that Cuba has 71% of the public sectors businesses.
  • UK: UK has the mixed economy, which means it is the economy which has almost same number of public as well as private sectors. Economy of UK is partially governed by the government, it means that government has very limited interference in business decision making. In UK although there are huge number of private companies but somewhere there are certain government policies that are followed by the private organizations doing business in the market. Companies like TESCO and Thomas Cook have very limited interference in the business processing on the other hand organisations like NHS are owned by the government and have full influence over the organisations.
  • China: Market economic system is followed by the economy of China. It is the free economic system which is being governed by the market preferences. This is the economic system in which allocation of the resources is done according to the requirements of the market, which mean production of the goods and services is dependent upon the needs and requirements of the customers and producers producing the product (Treiger, 2015). In China private firms makes 70% contribution in the GDP. Banking, lending and credits are the aspects that are taken under control of the states or the market.

2.2 In the UK the Chancellor of the Exchequer and the Bank of England plays a significant role in regulating the economy. The tools used by them are referred to as Fiscal and Monetary policies respectively.

The policies which are developed to maintain the tax rates and overall spending of the country are known as fiscal policies. Economy is being balanced by the government by making the changes in the composition of taxes and spending to manage the equilibrium. Fiscal policies are the tools prepared to maintain the balance of payment of the country.
The policies which monitor the flow of money of the country are known as monetary policies. Interest rates, borrowings and money lending are managed by the monetary policies because these are the aspects that affect the supply as well as flow of money in the market.
There are many businesses in UK on which these policies have a great impact. Reason behind it is that UK is a mixed economy in which restrictions are created due to these policies and businesses have to adopt the changes according to these policies (Coker, et. al., 2016).

Impact of Fiscal Policies: Fiscal policies could bring changes in two ways in which one is expansion of the fiscal policies. This policy leads to fewer intakes of taxes and depend more upon spending of the government. Applying this fiscal policies result in increasing investment by the businesses like farming and housing.  It could also be said that more investment will help the business in increasing the earning. On the other hand contraction of fiscal policies results in increasing the intakes of the taxes and reduces the spending. Investment of the businesses gets restricted due to these policies.
Impact of Monetary Policies: Relaxation and contractions are the two variants of monetary policies. Relaxation leads to reduce the tax rates and increase the inflow of the money. It helps in increasing the purchasing power of the customers which provide benefits to the businesses like farming and housing. Contraction is another variant which reduces the purchasing power of the customers with the effect of which demand in the market gets reduced and so affects the market of housing and farming.

2.3 Evaluate the impact of competition policy and other regulatory mechanisms on the activities of a selected organization.

Competition is one of the driving forces that help the organisation to perform better in the market. With the help of competition capability as well as productivity of the organisation gets enhanced. Competition policies were introduced aiming to maintain the decorum of the market of UK and to ensure that companies should indulge in the fair practices (Valentinov, 2015). Competition policies give rise to bring innovative ideas and help the companies to sustain in the market. There are certain competition policies that have a great impact on the business process of Primark:

  • De- regulation:It is the competition policy that is being adopted to reduce monopoly from the market. Merger and acquisitions are regulated by these kinds of policies aiming to reduce the monopoly from the market.
  • Privatisation: Privatisation is the policy adopted to develop the economy. This economy supports the transfer of ownership.
  • Laws on anti- competitive behaviour:This competition policy is developed to introduce fair deals in the market. There are certain legislations that are introduced to ensure that price fixing and other type of unethical practices could get reduced from the market. Breaching the law in UK by the companies leads them to pay 10% of the world turnover and imprisonment to the senior executives.
  • Import tariff reduction:It helps the businesses to import the products and services on lower price rates as taxes get reduced to help the companies to grow in the market.
  • Market Liberalisation:Market liberalisations are the competitive policy in which industries facing monopoly are being managed.

Example: Monopoly is being faced by the supermarkets of UK. Due to some of the big firms like TESCO, ASDA and Sainsbury industry was feeling dominated. Small retailers available in the market were getting affected because these firms are regulating the businesses since 2012. Monopoly started getting reduced after emergence of Aldi and Lidl. With the help of OFT monopoly got reduced which helped other retailer in the market (Everaert, et. al., 2015).

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Task 3

3.1 Explain how pricing and output decisions of businesses is determined in the following market structures.

One of the most important aspect which directly affects the pricing as well as outcome decisions of the businesses is market structure. Levels of competitions help in categorizing the levels of competition in the market. There are certain forces available in the market which affects the decision of the businesses. Number of firms and the barriers to entry in the market are the two factors on which the structure of the market relies. Some of the market structures that exist in the market are:

  • Perfect Competition: It is the market where there are large number of buyers and large number of sellers selling similar products. In this market all the organizations remain equally capable and no organization dominates the industry for long period of time. Similar products are produced by all the organizations having very less variation in the quality and price of the products. Perfect competition could be seen majorly in agricultural firms. Reason behind it is that agricultural products cannot be differentiated by the buyers and are of standard nature. Brand value does not much impact on the sale of agricultural products (Chase, 2016). Reason behind no company dominate the industry is because entry and exit of the company is free in perfect competition.
  • Monopoly: It is the market in which there is a single seller selling the product and large number of buyers. In monopoly market top players of the industry restricts the entry of other companies. Industries selling differentiated products get affected due to the monopoly in the market. Price of the products and services are decided by the firm leading in the market in which prices are kept slightly lower than the average cost of the new entries so that entries could get restricted in the market. Organizations which patent their product fall in this industry because by patenting the product they restrict the entry of the other firms in the same industry. Example for the company falling in monopoly market is Linux as it owns UNIX and has the copyright on that which restricts other software developing companies to avail similar product in the market.
  • Oligopoly: The market in which very few firms dominate the industry is oligopoly. Partial competition occurs in this type of market because there are very few sellers and very few buyers of the product. Coming to the grocery market of UK there are very few organizations like ASDA, Sainsbury and TESCO that dominates the industry. There are certain small scale organizations that provide same products and services but the companies having strong value in the market are not letting these companies grow ("McDonald's Corp., 2016).
  • Duopoly: The market in which two companies dominates the industry is known as duopoly. Competition between two organizations only exists. Competition is held between the organizations either on the basis of the quality and quantity of the product in the same prices. One of the best examples for duopoly is Pizza Hut and Dominos. Both the firms are delivering similar products to the market i.e. pizza for which they compete on the quantity as well as quality of the product. Larger market share is covered by both the players present in the industry. In the same industry market share of other small companies have least affect on the top leading companies.

3.2 Illustrate the way in which market forces (demand and supply) shape organizational responses using a range of examples.

Demand and supply of the product are the most important factors that drive the response of the organization. It helps in taking the decisions related with the pricing.
Demand: The desire and willingness of the customer to pay the price for specific product or service is known as demand. Demand of the product and services depend upon the needs and wants of the customers available in the market and could vary according to the changes in their needs or purchasing power (Wood, et. al., 2016). According to the law of demand, if all factors remain constant in the market then demand of the product remain inversely proportional to the price and products. Demands curve will help in delivering better understanding with demand curve.

market forces demand

Above figure shows that with the increase on the price of the product demand decreases and vice versa. There are various factors due to which demand of the product could get affected these are:

  • Taste and preferences of the customer
  • Change in the income of the customer
  • Availability of the substitute products in the market
  • Change in the number of buyers in the market

Supply: The fundamental economic concept that describes total availability of the goods and services in the market for the customers is known as supply. Supply depends upon the ability of the producer of how much it could produce and avail to the customers available in the market. There are certain factors that are attached with the supply of products and services these are availability of the resources, demand of the products available in the market, production cost, etc (Jurigová, 2016).

According to the law of supply increase in the demand of the product leads to decline its supply and vice versa, price is directly proportional to the supply. It means that increase in the price of the product leads to increase it supply as it helps the producer to generate more revenue.

market forces supply | HND Assignment

Above figure shows the supply curve in which it could be seen that with the decline in the price of the product, quantity supplied also decreases and vice versa.
market forces supply and demand curve

Supply and Demand Curve

Above fig is showing demand and supply curve in which demand is inversely proportional to supply.
For Example: Dominos increased it profit because organization has recognized the demand of the product and prefer to maintain the supply which leads to reduction in overstocking of the product (BARON, 2012).  It could be analyzed that gaining information related with the market forces helps the organization to respond according to the market conditions which helps it to grow and sustain.

3.3 Judge how the business and cultural environments shape the behaviour of a selected organisation.

Cultural environment is one of the factors that help the business to take a shape. There are various factors that not only impact the internal environment of the company but they also have a great impact on the external factors of the company. There are certain factors that are related with external business environment they are political factors, economical factors, social factors and technological factors. These are some of the factors that have a great impact on the functions as well as behavior of the businesses (Treiger, 2015). TESCO is an organization doing business in a retail market of UK. TESCO deals with the domestic as well as international clients. For such a huge company it becomes necessary to focus on the factors which could affect its functions as well as behavior in the market.

Political environment of UK is pretty stable which allows the business to function smoothly. For TESCO it is necessary to develop the strategies according to the market and political environment so that it could function smoothly.

Economical factors are another factor that should be taken under consideration by TESCO. UK has a mixed economy which allows the private firms to operate their business smoothly. UK has a stable economy which does not affect the price and trade of the product, this is one of the positive aspects which help the businesses to grow and sustain in the market.

Social factors should be taken into consideration by TESCO. For an organization like TESCO which is dealing in such a huge market becomes necessary that it should work towards to help the people available in the society (Coker, et. al., 2016). TESCO should ensure that its process should not affect the people available in the society and should try to provide them support which could help them in growth.

Technological factors should be focused upon because applying the new technology to the workplace will help the organization to manage the work process accordingly (PALMER, et. al., 2011). Adopting the new technology will help the organization to process the work and deliver the products and services within the time. Adopting the up graded technology also helps the organization to attain competitive advantage in the market as TESCO will be able to manage the demand and supply in a more appropriate manner and will be able to fulfill the requirement of the customers available in the market.

Cultural factors should also be taken into consideration by an organization. It is necessary that TESCO should understand the culture of the people present in the market. People of different market have different set of beliefs, values and cultures. Understanding their beliefs and culture will help TESCO to function accordingly (Valentinov, 2015). If TESCO will provide the product and services according to the culture then people will also like to choose the products of the company which will help it to grow in the market.

Considering these aspects will help the organization to sustain in the market. Taking the cultural factors TESCO could fulfill the requirements of the public and could build trust among them which will help the people to remain attached with the company.

Task 4

4.1 Discuss the significance of international trade to UK business organizations.

International trade is one of the factors that help in the expansion of the business in the market. International trade will help TESCO to enhance its business and to grow in the international market (TESCO, 2016). It is necessary that all products could get availed in every market so as to fulfil the requirement of the products and services international trade is being done. Companies always gets benefited by international trade, it is being analysed that UK is the second largest country in terms of international trade. Reason behind it is the economy as the economy of the country is stable. There are several benefits of international trade such as:

  • International trade provides the scope of covering huge market. Indulging in the international trade will help TESCO to grow and to expand its market. By exporting the products TESCO would be able to attract more customers towards its products which will help in enhancing the brand value in the international market (Everaert, et. al., 2015).
  • Increase in export will lead to increase the production which will reduce the cost of production of the goods and services. When products and services are produced in bulk quantity then the cost of production of that product or service gets reduced which helps the company to manage its revenue and maximising the profit.
  • International trade is not only being done by exporting the products sometimes it is required to import the products and services. It is not necessary that TESCO will get all the products in the domestic market and if it will be available then it would cost a higher price for TESCO (Chase, 2016). Therefore, rather than purchasing the raw material from local market TESCO could import it with the help of international trade at lower rates which will help it in reducing the manufacturing cost as well as cost of the finished product which will help in increasing the sale of the products in domestic as well as international marketing.
  • International trade helps in uniting the world; reason behind it is that import and export of the products and services helps in allowing the countries to communicate which leads to develop healthy relationship between two countries. European Union is the market that allows about 28 countries trade freely and a healthy relationship could be seen among these 28 countries which fall under European Union.

4.2 Analyze the impact of global factors on UK business organisations.

There are various global factors that have a great impact on the UK business organisations. Companies doing trade international should understand the global factors which they could directly affect the business processing.
Trading in the international market helps the business to provide opportunities to the business to enter into the new market. Dealing in the global market helps in enhancing the economy of the country and developing positive relationship with other countries.
New market opportunities can be developed by trading in the global market. Dealing in the global market helps in enhancing the availability of the resources which creates the opportunity to trade in various markets and grow ("McDonald's Corp., 2016).
Global factors ensure that company could grow globally which helps in growing the business and building brand image in the market. Companies could attain competitive advantage by indulging in the global market.

Global factors also include protectionism which is the policy developed to support fair trade between the countries which are indulged in the export and import practices.
Global factors include World Trade Organisation which regulates the international trade and ensures that fair trade in the international market between the countries.
Analysing all the aspects related with international trade it was evaluated that volume of import of UK is more than the volume of export. Reason behind the import is that China and India has cheaper labour which produces more and prefer to export the products and services to other countries (Kane, 2016). A count of 13% international trade between UK and USA is being observed due to which fluctuations in the economy of US affects the business of UK (WEATHERLEY, et. al., 2014).

4.3 Evaluate the impact of policies of the European Union on UK business organisations.

European Union plays a very vital role in managing international trade and the activities of the businesses in the European market. It involved 29 countries that are being allowed to trade freely between each other (orthington, et. al., 2014). Although countries are free to trade freely in the market but there are certain rules and regulations that are bound to be followed by every organisation trading in the market. These rules and regulations have a great impact on the activity of the businesses. According to European Union, it is necessary that businesses should trade in one currency i.e. Euro.  There are certain policies of European Union that have a great impact on UK business organisation they are:

Environment policy of European Union ensures that the companies should work towards protecting environment and helping in environmental sustainability. European Union allows the businesses to function in the standardised environment which provides fair trading environment to the businesses of UK (Kim, et. al., 2016).

Free movement labour legislation is another policy that is governed by European Union. According to the policy migrants from European Union should be provided equal opportunities to work in UK, local government will not interfere in providing equal opportunities to the migrants.

BREXIT is the term which was formed when UK argued for the withdrawal from European Union because companies were facing issues while working according to European Union. It was one of the most negative impacts on the companies as there are many of the companies were getting their businesses from the countries which were involved in European Union. This decision of withdrawal from European Union affected many of the companies because it restricted the free trade of the companies of UK with the countries of European Union (Wood, et. al., 2016).

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Business environment is one of the most important aspects that should be focused upon by the businesses of UK. Change in the business environment could directly impact the functioning of the business. It is important the organisations should analyse the market and should make decisions accordingly, such type of activities will help in the smooth functioning of the business and will help them to grow in the competitive market. It could be suggested that organisations should try to expand their business and enter into the international market. This will help the organisation to grow and sustain in the highly competitive market.


Business Environment Primark references