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Unit 1 Business Environment Primark Assignment copy 2
Diploma in Business
Unit Number and Title
Unit 1 – Business Environment
Business environment is a vast area where the organization works. The business environment consists of internal environment as well as external environment where the business operates. The internal environment of organization includes the management and the employees and the external environment includes the society, in which the organization works, customers for whom the business works and the stakeholders to whom the business is liable to. The stakeholders are the most important part of business strategy and the organization should keep the stakeholders interested in the business for the betterment of the organization. In this Unit 1 Business Environment Primark Assignment copy 2, various organizations of different categories and their purpose of operations have been discussed. Primark is one of the organizations, situated at UK and the primary business of the company is dealing in the retail industry operating its business in Australia, Belgium, Germany, France, Spain and Ireland. The report presents the purpose of the organization and study has been conducted about the stakeholders and the business environmentin which it operates. The report also focuses on how the businesses understand the external environment full of challenges and the impacts of the factors on the operation of the business. In the present world where the businesses have become global, the Business Environment Primark Assignment copy 2 also explains the global factors that affect the working of the organizations. The report includes the explanation of the economic systems which are followed in the countries like Cuba, UK and China. The different market situations such as monopoly, oligopoly is also explained concerning the factors of price determination and the outcome decisions of the organizations.
1.1 Identify what type of organization is Primark and discuss its purpose. In addition identify and discuss the purpose of one organization within the following categories.
Primark is an organization which launched in the year 1969 and situated in UK. Primark is a subsidiary company of Associated British Foods group and deals in the retail industry of fashion garments. Primark runs around 238 branches across the countries like UK, Europe and Ireland. Primark’s head office is situated at Ireland. The company indulges in the business of manufacturing of clothing. The purpose of the organization is customers oriented business as it not the manufacturer of its own goods rather it gets the goods manufactured and got supplied as per the needs and demands of the customers. It has the pricing policy which offers the product at low prices and focuses on the target customers.
Charity organizations: The charity organizations are the non-profit organizations which are the focused on the well-being of the society and with the goal of providing several services for the society. NSPCC is a non-profit charity organization working in UK for the benefits of children. The organization helps the parents and the families through counseling for the safeguards of the children. NSPCC works across the whole UK and operates around 40n service centers. The core purpose of the organization is to helping the children and parents with the issues related to mental health. The purpose of NSPCC being a charity organization,
- The organization fights for child abuse.
- To write a safeguard policy regarding security for disabled children.
- To fight against children sexual exploitation.
- To aware the community for the protection of the interest of children
- To take steps to provide education for every child.
- To organize various campaigns for the awareness of safety of children
- Tackle the cases of mental health of children and of depression and suicidal cases in children (Longhi, et., al., 2016)
1.2 Describe the extent to which Primark meet the objectives of its different stakeholders.
Stakeholders hold the important position in the development of the business and economic growth of the company. The stakeholders are the people who are responsible for building the sustainable position of the organization in the market. There are two types of stakeholders in an organization like Primark which are the internal stakeholders consisting the employees, management of Primark as well as external stakeholders which are the customers, government policies, society and the investors of the company. The stakeholders have an impact on the operations of the company and for the betterment of the business, company need to understand these stakeholders and satisfy them considering their needs. The extent to which Primark meet the objectives of its different stakeholders are;
Internal stakeholders of Primark
- Primark keep the employees of the organization motivated through the adoption of providing the intrinsic and the extrinsic rewards to them. Primark give the employees the opportunities to participate in the decision making processes of the company and make the employees feel like they are valuable asset for the company.
- Primark provides the management an environment where the managers can take their own decisions in the direction of the organizational goals.
Customers:Primark has the policy of customer centric approach. The company gets the manufacturing of the clothing done from the suppliers after analyzing the preferences, needs and demands of the customers. After sales services are also provided by the company to make the customers satisfy with the company.
External Stakeholders of Primark
- Primark always pay off the taxes and the duties on time and hence follow all the rules and regulations.
- Primark takes regular initiatives towards the corporate social responsibility and the company takes into consideration the interest of the society and provides the products as per the needs of the society and which do not harm the interest of the people. The steps are taken by the company with regards to the pollution control and the proper systems are established for the collection and dissemination of the waste elements of the company.
- the investors of the company are the basis for all the operations of the company as they provide the required funds to the company. Primark provides timely and accurate financial statements of the company which depicts the true picture of the financial position of the company so that the investors can take the right decision regarding investment. The statements regarding the company’s financial policies are also provided to the investors (McCarthy & Muthuri, 2016).
1.3 Explain the responsibilities of Primark as an organization and the strategies employed to meet them.
The organization runs in society and for the society, thus the major responsibility of an organization is to operate in an ethical environment considering all the factors of the internal as well as external environment of the organization. The organization has to keep the interest of all of its stakeholders and should be responsible for its every action. Primark being an organization surrounded with the business environment has to fulfill certain responsibilities towards the society and the people associated with the organization. Some of the responsibilities of the company are;
- The company should consider the interest of the employees working for the organization and should reward them on the basis of their performance.
- Customer satisfaction is one of the major responsibilities of Primark.
- Steps to be taken by the company to protect the environment and proper arrangements are to be made for the pollution control and waste emissions.
- The responsibility of Primark towards the government is to pay all the taxes on time.
- To provide the workers the safe and healthy environment in the organization.
- To follow the rules and regulations of law and avoid the violation of any kind of law (Luukkanen, 2014)
For the fulfillment of these responsibilities, Primark has taken several steps and formulated various strategies. Some of the strategies of Primark in meeting its responsibilities are;
- Motivation strategy: Primark has establishes policies where the management and the employees are given the intrinsic and the extrinsic benefits for keeping the employees motivated for work and retention of the valuable employees in the company.
- Pricing and product strategy: the company adopts the low pricing strategy to make the products affordable foe customers and develop products as per the needs of the customers.
- Corporate social responsibility: the policies are prepared to protect the environment and the steps are taken for the safeguard of the society.
- Strategies for workers heath: Primark in order to fulfill the responsibility of the security of workers, health and safety strategy is being adopted by the company in which measures are taken for insurance of workers against any hazards.
- Law: The Company makes the strategies to avoid the consequences of the non-compliance of any law and the rules and regulations applied on the company (Dinu, 2014).
3.1 Explain how pricing and output decisions of businesses is determined in the following market structures
- Perfect competition:A perfect competition is a market scenario where the competition is on its highest level. The market is filled with the similar kind of products and the customers of the products have the wide range of the availability of the products to choose from. The companies are allowed to enter the market and exit the market at any time. The price in the perfect competition market is determined on the basis of the equilibrium between the demand and supply. The prices are determined by the industry as a whole and are not controlled by the individual firms. The equilibrium is the point where the demand and supply intersects each other and the market price of the product is determined (McDermott, 2015)
- Monopoly:Monopoly is a scenario where the market is being controlled by the single seller of the particular commodity. There are no direct competitors of the products of the firm and the situation makes the sellers able to influence the prices of the commodities. The number of independent sellers is more and they change the prices according to their benefits. The price under the monopoly is determined by the equilibrium when the marginal cost intersects the marginal profit. It is a point of maximum profit.
- Oligopoly: Oligopoly is the situation of the market where there are lesser number of sellers in the market and this result in the less competition. The price is determined by the firms altogether and there are fewer chances of the changes in the prices. There are two kinds of situations that prevail in this kind of market that are the pure oligopoly and imperfect oligopoly(Ghosh & Sarkar, 2016).
- Duopoly:In the market where there is duopoly are the markets where only two firms operate. The prices are controlled by these two firms only. The firms can change the prices any time.
3.2 Illustrate the way in which market forces (Demand and supply) shape organizational responses using a range of examples.
Market forces are the factors which determine the profit generated by the organization. There are two prominent factors of market and they are demand of the commodity and the supply of the commodity. Demand refers to the willingness of the customers to buy a commodity at a given price and in a particular time frame. Supply, on the other hand, refers to the quantity of goods which the producer is willing to sell at a given price in a given time frame. The market forces have an impact on the shaping of the organizational responses to the demand and supply. The organizations keep on changing the policies and strategies according to the business environment. The increase in demand and supply, decrease in demand and supply relates directly to the change in the pricing policies of the organization. when the market is flooded with the demand of the commodity then the organization can bring changes to its pricing policies and increase the prices of the products so that the organization can gain greater revenue and also to control the demand in the market. Similarly, when there is increase in the supply of the goods in the market as compared to the demand then the organization may decrease the prices so that more sales can be generated. The organization may also bring changes in the production process as in high demand it can increase the production level and with the increase in supply it can control on the production. On the other hand, if the demands are decreasing in the market then the organization may lower the prices to attract more customers and increase the supply. When supply decreases then it will increase the production of the commodity. An example can be taken of a commodity like new brand of protein drink has been launched by the organization and the demand of the drink has increased tremendously, then it may impact the responses of the organization to hike the price of the commodity as a result of increased demand (Stockemer, 2012).
3.3 Judge how the business and cultural environment shape the behavior of a selected organization.
The organizations are surrounded with several factors and these factors are the external as well as internal factors of the organizations. The cultural environment of the organizations shapes the behavior of the workplace. In the organizations present in the global world, various cultures are found and people from different backgrounds are coming together in the same organizations. The cultural diversity which is seen in the organizations affects the behavior of the organization and the responses of the company towards the environment. The coming of people from various backgrounds and cultures brings the diversity in skills, capabilities and the innovations in the business of the organizations. The production capacities can be increased and the connection of the business to the outer world on a global platform can become possible. The language barriers with the international clients of the company can come to an end and with the help of wider business connections the reputation of the company is built up in the market. The advancement in the technology can also be achieved with the cultural diversity and advanced services can be provided to the customers. The organizations like Primark, which have its business in different countries can be benefitted with this kind of cultural environment ion the organization. The customers of different countries can be entertained with the diverse staff of the organization. The communication becomes possible and the barriers in communication can be put at bay. With the culture of having interpersonal communication in the organization the work environment can be benefitted with better understanding of the policies and goals of the organization. The cultural environment in the organization brings lots of opportunities for the business and the efficiency and the effectiveness of the business increases on a rapid phase. The behavior of the organization largely depends on the ethical practices of the organization. If the cultural environment of the organization is healthy, then it results in the high level of performance of the employees and which increases the productivity. Strong leadership also motivates the employees to work in the direction of the organizational goals and promotes the environment of the teamwork. The cultural environment also focuses on the accountability of the members of the staff and the roles and responsibilities are distributed in the organization in order to make the policies clear to all (Brewer, 2014).
The organizations operate its businesses in the business environments which can be the internal business including the employees and the management of the company as well as external environment which may include the customers, suppliers, government, investors, trade unions etc. These factors form the part of the stakeholders of the company who are the most important asset for the company and the success of the business is dependent on these stakeholders. The company need to focus their efforts on the fulfillment of the interest of these stakeholders and strategies should be prepared in order to satisfy the stakeholders. The report has explained the purpose of the organizations. Study has been conducted on an organization named as Primark, a company having a business of retail in clothing and with the head office in Ireland. The purpose of Primark has been explained, responsibilities and the strategies which the company has made for the stakeholders are discussed in the report. The report also explained the economic systems operating in the countries like Cuba, UK and China. Fiscal and monetary policies have also been described and the impact of these policies is shown on farming and the housing businesses in this report. The report also consist the study of various types of markets situations, namely perfect competition, monopoly, oligopoly and duopoly and how these markets effects on pricing. Demand and supply also plays major role in the organizational policies and the shape of behavior of the organization from the cultural environment in organization. report also focuses on the international marketing trade related to the UK business organizations and impacts of global factors on UK. The impacts of European Union on the business of UK business organizations.
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