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Leading supermarket in the UK

University: UK College of Business and Computing

  • Unit No: 3
  • Level: High school
  • Pages: 9 / Words 2201
  • Paper Type: Assignment
  • Course Code: N/A
  • Downloads: 252
Question :

This sample will let you know about:

  • What is PESTLE model?
  • Explain Environmental factor.
  • What is Economic factor?
Answer :
Organization Selected : ASDA

INTRODUCTION

Enterprise management is term which is used for modern examples of ERP. That is allowed to businesses for managing day to day processes like inventory management accounting, human activities and customer relationship management. In respect of analysing the business environment,ASDA is chosen for present report, which is a British supermarket retailer company, founded in 1949. Company deals in various products and services which they are provided to customers. The report will cover a brief summary of current position of ASDA company. This will explain PESTLE model related to assess the general business environment. This will also highlight the application of model in retail industry.

Overview of current position of ASDA.

ASDA is the British supermarket retail company that is associate dairies company of Yorkshire. The company have 165000 number of employees with 633 number of location. The company deals in various products like Grocery, General Merchandise and financial services of business. Company marketing promotion usually based on price like its parent company. The company is recently promoted slogan which is œSave money, Live better. In the 2018, company is announced a merger plan which have combined supermarket an estimated 30% share of UK. The current position of company is better and have loyal customers. Need Assignment Examples?Talk to our Experts!

In 2019, CMA blocked the proposed merger by suggesting which it increases price for customers and make competition unfair for the other retails of UK. ASDA sales increase 0.1% in the 12 weeks which is taking share to 15.4%. But other companies are falls their business which means their market share are dropped. This is the main reason ASDA has overtake Sainsbury to become UK second largest supermarket to suggested for business. Current ASDA is the largest stores which is offers extended range across food, George and non-food. Recently company is make their complete focus on food and conveniences and offers essential non-food items.

PESTLE model

PESTLE analysis is very useful tool which is helps to business strategies for understand the impact of macro environmental factors on their businesses. This help to them for making strategic direction and decision-making process (SHTAL and et.al., 2018). This refers with 6 elements and factors which are affect and assess with the general business environment.  

  • Political factor: It is one of the most important factors which is imposed by the government norm and also companies had to work according to the set directions. It mainly carries the government policy which is implemented on companies regarding working in set guidance and not violating any of the norms or laws which is imposed for securing the right of the persons (Zhao and Dou, 2019). It covers taxes and laws which secures the rights of nation regarding taking initiative to bring changes in their working management. 
  • Economic factor: This factor mainly carries the aspects which results in affecting the economy of the country through facing issues regarding variances in rate. It mainly includes the interest rate, inflation rate, foreign rates in respect of expanding business iboth domestic and overseas market . If any company dealing in carrying foreign trade I.e. importing and exporting the business, then in respect of imposing the exchanges rates, the growth of business is fluctuated (Thompson and McLarney, 2017). The external economic factors which affects the growth of business to sustain in market for longer way is relating to inflation rate. In this the prices of the products are increased and decreased due to changes in market trends which results in arising competitors in market. 
  • Social factor: The major impact which arises in business due to external factors is relating to the cultural aspects. As every person belong to different culture so, preferences of availing the products is also different. Thus, it indicates that the impact arise regarding adapting such changes and working according to the set directions. Consumer taste depends upon the changes in time and also they mainly focus on preferring the organic products (Düerkop and Huth, 2017). Thus, the impact raised in respect of producing such products which fulfil their needs and demands in better way. In such manner, the impact is raised regarding changing in market trends and also people are focusing more on preferring the healthier products which resulting in sustaining their interest in longer way.  
  • Technological factor: The impact is examined regarding choosing the advanced technology to promote the business in market and distracting customer towards preferring their own products (Policy, 2016). The issues are raised regarding promoting the business through digital marketing by undertaking the innovative advertisement concept or any other promotional activities to retain the customer interest. As due to changes in time customer are attracting more towards the company innovative websites or fastest technology in respect of getting order within the set time limit (Walsh, Bhagavatheeswaran and Roma, 2019). Thus, by adapting such changes resulting in getting high sales and also increases the promotion of the products through preferring the innovative promotional concepts.  
  • Legal factor: The laws such as health and safety law, employment legislation, consumer laws which cause impact to the company through not following it with the said rules (Gheibi and et.al., 2018). As the impact upon the company arise through not taking care of the employees when they are working under the hazardous places or also they are negligences in performing their duty regarding providing quality products to customer (What is PESTLE Analysis? A Tool for Business Analysis, 2020). In such aspects, though external factors, they affect their integrity regarding maintaining reputation in market for longer way.  
  • Environmental factor: The major impact through this factor is raised regarding changes in climatic condition or destroyed of products through natural calamities. It also affects due to facing changes in demand of the people regarding preferring the eco friendly products (Perera, 2017). In such aspect to reduce the impact, company mainly deal in producing such products which results in eco-friendly environment or also providing such products with the set quality within the set time limit.

Application of model in retail sector.

By conducting the PESTLE analysis in business, management of a company like ASDA can identify the factors which may create major opportunities or threats for business at a certain marketplace (PESTEL analysis of ASDA, 2017), in following way - Political factor: The major impact which is faced by the ASDA is relating to changes in government norms relating to the taxation policy. As the norms and regulation of the government are strict in respect of importing and exporting goods in own country or in different country. Thus, the issues arise regarding variation in taxes policy which results in restricting ASDA to expand the business into different countries (Eisenberg, 2019). The positive aspects of government taxes is that it restrict other companies to import the business as it provide chances to other companies to promote such products in market. The negative aspects is that it bounds company to not adapt any innovative concept in business as government norms are strict regarding bring innovative ideas in country in respect of enhancing the profits in business.  

Economic factor: In context of external environment, the major impact lies on the bases of inflation rates regarding expanding the business at global level. As the major inflation which is faced by ASDA is relating to cost of labour. As due to less in demand of the ASDA products, they had to manage the expenses which is incurred in respect of producing the products by labour and also had to bear expenses in respect of purchasing the raw materials (Rapo, 2019). Thus, the impact faced by ASDA is on the bases of pricing strategies which they imposed on dealing in particular products. The positive impact of economic factors on ASDA is that they enjoy the high benefits of purchasing power in respect of providing high quality products. The negative impact lies on the bases of inflation in cost of labour regarding facing less demand on particular products but had to pay money to labour on agreement bases.  

Social factor: In respect of undertaking the social factor in ASDA, it mainly results in causing impact through changing their norms as per the market trends. The culture and taste of the person are fluctuated depending upon the changes in time and environment needs (Ghez, 2019). Thus, the impact which is faced by ASDA is relating to imposing such policies which results in securing the interest of customer towards the business for longer way (Debra Paul and Cadle, 2019). The positive impact arise in respect of increasing the pension scheme for the employees of ASDA so that it results in sustaining in business for longer way. It also results in gaining advantages from social factors through opening the supermarket for longer hours, so that they can fulfil the needs of the customer in better way.  Take Thesis Writing Help  from our experts!

Technological factor: The impact arise due to adapting the advanced technology in business or making continuous improvement of exiting online sites to regain the interest of customer. The impact which is faced by ASDA is relating to enhancing their online networking sites in faster way and also securing the customer details and information after availing the services of ASDA. As ASDA is planning for bringing new strategies in business such as self scanning of the products, once they are taken by the customer (Peace, 2016). Though this manner they re helping customer through saving time by just clicking the requirement of particular products and avail it within the less time limit. The negative impact which arise through adapting the advance technology is that the chances of hacking the company detail and customer information are increased. It also results in increasing the cost of the online sites through making changes in their online websites or the procedure which they are using to reach to customer.  

Legal factor: The legal factors which results in causing impact to business is relating to the health and safety laws, employment legislation laws and consumer laws. The impact on ASDA is faced regarding not paying any less amount to employees as per the amount fixed under the minimum wages act in UK. The positive impact of undertaking the legal factor is that it secure the right of the employees at work place through wearing the equipment if they are working at hazardous places. It also helps ASDA to set some limitation to the employees regarding taking strict action in case of breach committed in not following any of the norms (Bentham, 2018). The negative impact of legal factor in ASDA is that they had top work according to the norms mentioned by the government regarding taking care of employees and if not work according to it, employee carry the right to file suit against the company under the employment tribunal. Order assignment help from our experts! 

Environmental factor: The impact which arises to business is relating to the providing the eco friendly products in market and also deal in organic foods which retain the customer interest in longer way. The positive impact which is faced by ASDA through adapting this external factor is that they retain the customer interest through providing the goods which are eco friendly and also as per customer demands (Evans, 2017). The negative impact arise regarding not providing the company products within the set time period due to changes in climatic condition or issue arises due to natural calamites. As this resulting in causing negative impact upon these factors regarding not fulling the customer needs though providing the products within the set time period.

CONCLUSION

From the above study, the report conclude the matters relating to enterprise management in which they manage the overall activity of the business which they pertain in their day to day operations. The management is to be undertaken regarding controlling the inventories, managing activities of human resources and building the strong relationship with the customers. In this report, the matters is presented for the ASDA company which carries to be the second largest supermarket retailer chain in UK. In this report, the discussion is undertaken on the basis analysis of PESTLE model and its impact upon the business. The matter are also discussed relating to the ASDA which faces external impact regarding sustaining the business in emerging market for longer way.

For more - Conference for The World Association of Travel Agencies

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