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Unit 1 Business Environment Primark Assignment
Diploma in Business
Unit Number and Title
Unit 1 – Business Environment
1.1 Identify type of organisation of Primark and discuss its purpose along with the other types of the organisation
Primark is the renowned fashion designing company offering the innovative fashion products at a lower cost with the help of the supply of their required materials and products from the suppliers from India, Bangladesh, China, and Turkey(Primark, 2015). Based on the functions and the business operations, it can be stated that Primark is the Private limited company. It has the shareholders with the limited liability. The purpose of the business is to offer the requirement of the market in terms of the finished goods or products and to gain the profit from the market to be shared the profit among the limited number of the shareholders. The profit is not shared among the public. Thus, it is recognised as the private limited company.
Out of the three sectors such as Public sector, charity, and the cooperative, it can be stated that the public sector company is the company which use to offer the various governmental services to the entire population of UK(Laegreid & Christensen, 2013). The purpose of the public sector is completely dependent on the offering of the services to the entire population even those are non-tax payers of that received services such as street lights, smooth roads and others. One of the example of the Public sector Company in UK is the Audit commission in UK(Ball, et al., 2014). The Audit commission use to appoint the auditors to all the local authorities in England, and in Wales covering the local government, housing, health community safety, and the criminal justice. Thus, the basic purpose of the public sector Audit commission is to offer the non-discriminated services to be offered to the entire population of UK in an effective manner.
Thus the basic difference between the public sector and the private sector company is the offering of the services for the non-payers / payers and only to the payers for the services or the goods respectively. The profiteared by the public sector company is shared among all bit this does not happen for the private sectorcompany(Mazzucato, 2015).
1.2 Describe the extent to which Primark meets the objectives of its different stakeholders
The key stakeholders of Primark are the Trade Unions- Civil society group, Workers and communities, and the customer groups. The extents that Primark use to meet the objectives of its different stakeholders are as below:
- Trade Unions: The objective of the Trade Unions and the civil society is to ensure that the international standard is maintained through business operations and the offerings by Primark. To maintain the standard, Primark works with a number of the civil society groups and the trade unions across the world. The two organisations such as: Ethical Trading initiative, and the International labour organisations are the partners of Primark to improve the ethical code of conduct and the improvement of the bur practices respectively. The ban on the usage of the child labour and the limiting the number of working hours are strongly monitored with thee collaborations with Primark(Primark, 2015).
- Workers and communities: Working for the better working environment is the objective to be meet for the workers and the communities. In 2010, Primark got engaged with the long term program so that they can offer the fair wage and the fair working hours to the workers of China. In India as well, Primark works with NGO to look after the interests of the workers of India. The NGO use to offer the education on the right power offering to the woman along with the labour laws and the prevention from HIV / AODS(Primark, 2015). In Bangladesh, they are working with Awaj Foundation to offer the health care initiative for the women.
- Customer group: Primark is continuously engaged to bring the innovation in fashion with the lower cost base to attract the huge customer base. Thus, the objective here is to meet the requirement of the customers at the reasonable cost with the quality product. The suppliers from India Bangladesh, China, and Turkey use to help the business to meet the objective for the customers by offering the various designs at the lower cost(Primark, 2015). That is the reason, Primark is famous for responding to the needs of the customers.
1.3 Explain the responsibilities of Primark as an organisation and the strategies employed to meet them
The core responsibilities of Primark are as below:
- To offer the equal opportunities to the employees based on the merits: The strong membership with the ETI is enough to offer the best and non-discriminated treatment to the employees and the workers (Primark, 2016).
- To offer the fair treatment to their suppliers: The collaboration with the NGOs and the local authorities use to offer the fair treatment and the support to the local workers. The strong labour laws are maintained so that the child labour can be excluded for their checklist of the business operations.
- Offering the support to the local communities: The membership with the ETI and the civil society groups, Primark is able to meet the objective to offer the support to the local communities in terms of the education, and the health care services. Primark also use to work with the Job centre plus which use to offer the advice on jobs and training for those who can work and the financial management help those who can no wok (Primark, 2016).
- Offering the respect to the environment: with the help of the recycling of the 76 percent of the waste product of Primark, 50 percent usage of the energy from the renewable resources, and the 96 percent of the sites without the environmental complaints have proved that Primark is maintaining their environmental aspect in a serious manner (Primark, 2015). Controlling of the greenhouse gas emission, and the water management have become the priority fact by Primark in an effective manner. Along with that the Packaging based on thewaste regulations is given importance by Primark. They also have replaced the plastic bags with the paper bags so that they can be reused (Primark, 2016).
Thus, the responsibilities such as offering the fair price to the customers, becoming a green organisation, doing the ethical marketing, and maintaining the CSR approaches are properly met by the Primark through their initiatives and activities in an effective manner.
4.1 Discuss the significance of international trade to UK business organisations
As per the view of Dunning (2012), the international trade is the exchange of the capital, goods, and the services across the cross border countries in the form of the import and the export of the gods and services for the mutual benefit of the cross border nations in an effective manner. On the other hand, the globalization use to reflect the trends of the firms in expanding their global business with the help of the perfect distribution of their offered products and the services to the other markets in the global market along with their local market. Thus, the international trade use to help the organisations in the globalization fact and also use to increase the opportunities by bringing the competiveness for the organisations in a positive manner.
Based on the case scenario, the Britain’s trade with Europe will be affected by Brexit. Thus, as Britain use to export 40 percent of their goods to EU(Theguardian, 2016). Thus, they must have to reach a new trade agreement with the European Union. There are few issues as below:
- Post Brexit, UK will need a new trade agreement with EU under the article 50 of the Lisbon Treaty. It will set the two year renegotiable relationship between Britain and EU. The negotiation should be based on the expansion of the goods along with covering the custom procedures, passport control and the environmental consideration in a large manner.
- The tariffs will be imposed on the UK goods and services under the new trade deal with EU.
- As per the view of John Forrest, the head of the international trade at Law firm, UK requires the single deal with the 27 EU states but not country to country wise (Theguardian, 2016).
Thus, with the fair trade agreement, the firms will have a chance to expand their business and also to know the taste and the preference of the new market for the introduction of the product or the service innovation in a large manner. It will also facilitate the enhancement of the opportunities and also to attract the new investors for the further expansion(Hamilton & Webster, 2015). With the diversity maintenance, the firms also will be able to upgrade their existing skills with the help of the technology advancements with the fair trade agreement and the globalization. The perfect access to the new resources, and the perfect access to the unique and quality foods and the services that the local market has also will be possible. The wide ranges of designs, price structure and the taste / prefaces will be come into the picture in a clear form. With the import and export within the local market, the steady growth can be achieved. But with the fair trade agreement and the globalised business concept, the firms will be able to face the internationalreputation and the brand acknowledgement with earning of the maximumrevenue(Hamilton & Webster, 2015).The international trade gives the opportunity to exchange the products otherwise there will be scare choice of products and services for each and every nation.
4.2 Analyse the impact of global factors on UK business organisations
Globalization is the most important factor to be focused by the entire UK business house for the perfect development of the economic condition. In the globalized economy, it offers the provision to the UK business to make the different parts of a products in different nations and also to get assembled in different nations to get the quality goods in an effective manner(Forsgren & Johanson, 2014). This globalisation of economy use to influence the fact to sell the similar quality products to the global market instead of selling the different products to the different nations. In this globalization of economy, the intentional trade use to play an important role. It use to boost up the UK economy in a large manner. Many of the UK organisations use to operate their business operations to the other counters for the cheap labour and the resources to earn more profit.
In this aspect, the greater market opportunity along with the Global growth also can be expected in UK due to the impact of the global factors in an effective manner. The UK market has the opportunity with their advancement in the technology to conduct their business in an effective manner all over the world. The international marketing trade duties is another important global factor to have an impact on the business organisations. The countries buying the raw materials for other countries should bear the import duty and those are selling their goods to other counties from UK should bear the export duty(Forsgren & Johanson, 2014). The international trade duty in UK is low after the inflation rate. Thus, they can buy and sell ore products from and to the other nations.
The global financial stability is another important globalization factor to have a string impact in an effective manner. The business organisations use the international financial solutions and the trade agreements to reduce tariff. In UK, due to the stable finical situation, the nations can encourage more to invest their money to the further development of the trade. The impact of the Brexit through the trade and investment channels would have most severe impact in UK. The regulatory divergence would increase and will effect on the trade volumes and will also reduce the attractiveness of UK to attract the investors (Forsgren & Johanson, 2014). The overall impact of the Brexit has been mentioned as below:
- Norwegian Style EEA agreement: Here UK joins the EU and maintains the fullaccess to the single market, but it does not meet the UK politicalconcerns.
- Turkish style customunion: Internal tariffs are avoided and not good for UK trade.
- FTA based approach: good relationship between Uk and EU
- Swiss style approach: may not be attractive for EU
- MFN based approach: no need to agree to common standards and this is the inconsistentapproach(Global-counsel, 2015).
4.3 Evaluate the impact of policies of the European Union on UK business organisations
The EU is a unique economic and the political union between the 28 European countries that together work for the better trade functions the global market (Europa.eu, 2016). To Foster the economic strength, it was created after the Second World War. The EU has delivered peace, the economic development and alsohas raised the livingstandards. The aim of EU was to make the countries economically independent ad more likelyto conflictfree. The policies and the impacts of the EU policies on the UK business are as below:
- Agriculture policy: The food security with the double food production in UK is required. As per this policy, the interests of the UK farmers are protected and they use to receive CAP subsidies of around £ 40 billion each year. This offering is to minimize the three problems that the UK farmers used to face such as: unstable food process, the les in the application of the new technologies, and loss of power to the supermarkets as they did not have the power of selling their foods directly to the market (Economicsonline, 2016).
- Business policy: The freedom of movement of thecapitalgoods and the services have been introduced by EU for the effective trade agreement maintenance and for the betterment of the UK trade. Together EU and UK has developed the concept of doing the business in the singlemarket. The UK trade growth die to the EU business policy has been mentioned as below:
Fig: UK Goods and Services Exports and Imports since 1980
The UK share of the global good exports is as below:
fig: UK Share of Global Goods Exports
- Tax policy: The low taxation imposed by EU on UK is enough to bring the competitive advantage. It has the highly competitive corporate tax system (Gov.UK, 2014). Due to the transparent cooperate tax system, UK is able to attract the foreign investment companies and the other trading counties to build up a strong trade relationships.
- Employment policy: Offering the fair wages so that the employees can fulfil their basic needs is the basic concept of the employment policy set by EU. Thus, the UK is also practicing the technique to offer the fair wage and the no child labour concept to abide by the rules and regulations and also to do the ethical business in an effective manner(Wallace, et al., 2015). Further, it also trigger the fact of ther eduction of the unemployment rate. Based on the policy, the unemployment rate in UK as below:
fig: Unemployment rate in UK
- Health policy: In organisations, the positive steps are taken by EU and UK together regarding the health care policies and the accidental policies to reduce the loss of the economy after the death. At the sae tie, the free treatment plan also is applicable for the population with the below poverty level to minimize the act of the discrimination.
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