Business environment Assignment
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Business organizations may face various challenges inside and outside the company. Various micro and macro elements impact the organizations which impact the decision-making process of the company. In this report, the impacts of the micro and macro environment on Specsavers have been discussed.
Specsavers Optical Group Ltd is a global optical retailer with locations in Ireland, the UK, the Nordic countries, and Australia. The chain offers eye exams, spectacles, sunglasses, and contact lenses, as well as optometry and optician services. Hearing aids are also available for purchase (Scepsavers, 2022). In 2012, it held the single largest market share among the four major opticians in the United Kingdom, accounting for 42 percent of the market. The company had annual revenues of more than 250 billion in 2018 and 2019 with around 2,000 locations across the United Kingdom, New Zealand, Guernsey, Norway, Ireland, Sweden, Denmark, Finland, the Netherlands, Australia, Spain, and Canada (Scepsavers, 2022).
Strong brand image
The company provides the customers with the best quality and cost-effective eye wares that has increased a huge customer base for the company (Scepsavers, 2022). It has also improved the brand awareness of the company. With the strong customer base, it has been enabled to develop a significant brand value of the company.
Specsavers also has a workforce in which all the employees are highly skilled and talented. Their expertise and skilled activities help in developing the best quality eye care products. This is crucial for developing the brand image and value of the company. The skills and talents of the employees can also help in providing a good quality service to the customers (Stindt et al., 2017). It has therefore increased customer satisfaction. With the help of high technology-based machines and equipment, skilled opticians can carry out eye tests and thus it becomes easy to make necessary decisions.
Variety of products
There are multiple products in a wide range of specifications which have become crucial roles for developing the company (Cooper, 2019). The customers can choose among a multitude of eye wares. This is one of the main factors for developing a robust customer base.
The company also uses advanced technology-based machines and equipment for product development and eye testing. Using the high tech-based system has enabled the chances of advancing the production process (Grewal et al., 2020). It has become another strength for the company.
The HR department is very skilled and qualified. The Human resource department provides necessary training and skill development courses for the employees to upgrade their knowledge and experience. With the help of the recruitment and selection process, the company recruits the most suitable candidates for the company (Banfield, Kay, and Royles, 2018). The HR managers also provide enough remuneration, health, and safety-related schemes and policies for the employees to increase their motivation and satisfaction. It has thereby increased employee engagement and retention.
The main weakness is that the company does not provide same-day service to the customers like its rival companies.
Customers may want to buy designing products (Leninkumar, 2017). The demands of the customers for designing products have decreased the sales of Specsavers. Most importantly, the company also has many competitors in the marketplace providing similar services.
Another weakness is that many customers complain about the quality of the Products of Specsavers. It can reduce the sales of the company. It can also hamper customer satisfaction and loyalty. Moreover, the brand value of the company can also be hampered by this (Shabbir, Khan, and Khan, 2017). It is therefore a huge weakness for the company.
Marketing and advertising strategies are also poor in the company. The managers need to improve the marketing and promotional activities. Social media and digital media platforms can be used to reach out to customers at a wide range for promoting the products. It can increase the brand image of Specsavers (Shabbir, Khan, and Khan, 2017). Using social media platforms, the managers can identify the needs and requirements of the customers and thereby can improve the products as per the requirements of the customers. Lack of marketing and promotional strategies, the customers are not informed about the products and their benefits. It is the major weak point for any company. Without having any promotional activities, the company cannot reach out to customers.
Another weakness is that the company does not have a stock of high-quality based products. The rivals like Bebe or D&G keep high-quality stock of eye wares which attracts many customers (Scepsavers, 2022). The company needs to develop innovative products to attract customers and increase its sales.
By developing innovative products and services in the company, Specsavers can enhance its brand value. The competitive advantage can also increase with Innovative product development (Gao et al., 2017).
Globalization can also be enhanced which significantly can enhance the brand image of the company (Rizescu, and Tileag?, 2017). International stores can assist Specsavers to increase its market share and thereby reputation, brand image and awareness of the company will be boosted. Technological advancement is also required to understand the customers’ requirements. It will help the company expand in the international market (Grewal et al., 2020).
There is also an opportunity that the company supplies various designing frames from the fashion companies to make the products vary as per the customer's taste (Leninkumar, 2017). Understanding the tastes and purchasing behavior of the customers, and using that information for product improvement will help in enhancing customer satisfaction.
Workforce diversity can be enhanced by employing employees from different backgrounds and possessing various knowledge. It will help in the exchange of information and knowledge among the employees (Cho, Kim, and Mor Barak, 2017). The employees can share their creative ideas and thoughts with one another. It will thereby help in developing a productive workforce resulting in the product development process. Moreover, it is also crucial for product innovation. This is how the company can increase its competitive advantage and thus the development and growth will be generated.
The main threat is related to the competition level. New rival companies can acquire a huge portion of the market which can significantly reduce the market share of Specsavers. The high competition in the market can also reduce the customer base of the company (Scepsavers, 2022). When the customers get more designing and better quality products in other companies, they can shift to the other companies. It will thus impact the profitability of Specsavers. Another threat is associated with poor marketing strategies. The company needs to develop its marketing strategies for enticing the customers and clients.
Political factors are significantly a crucial factor that can impact the external environment of an organization. The operations of a firm are influenced by political issues (Mudany, Letting, and Gituro, 2020). Government rules, limits, taxation policies, and other criteria must be followed in order for the organization's products to succeed. Political decisions include changes in business income tax in the United Kingdom and other countries. While conducting business in Europe and around the world, it's also necessary to assess whether the political environment is conducive to international investment.
Carbon pricing could put Specsavers in a jeopardy in the future. The tax policies regarding carbon consumption also impact organizational decision making, before making any significant decisions for the organizational functions, the company needs to adhere to all the policies and guidelines set by the government (Kotlikoff et al., 2021).
Depending on the population rate, unemployment rate, per capita income, changes in the economic development of the country become the measurable areas for any organization. Specsavers also need to consider these aspects. These are traits that affect the future of the company in both the long and short term. When the inflation rate increases, the company may face huge difficulty in tackling the operational costs, and the prices of the products are also thereby affected to make decisions (Habib, Mileva, and Stracca, 2017). Expected inflation might affect how Specsavers sets prices for specialty items. It could also affect consumer purchasing power and behavior. Inflation and interest rates, currency risk, and economic growth criteria are just a few of the economic factors to think about when starting a business (Habib, Mileva, and Stracca, 2017). Changes in the GDP of the country are another area that the company needs to follow before setting the pricing strategy.
Moreover, the global Covid-19 pandemic has caused huge economic pressure on all the business fields and Specsavers is no exception to this. Due to the loss, the company has been greatly affected (Yoosefi Lebni et al., 2021). The revenue collection and sales have also been hugely affected. Now, at this moment, the operational activities, pricing, and other cost-related areas will be considered by Specsavers.
The corporation must take into account the client's expectations, preferences, and interests. Societal attitudes, demography, socioeconomic conditions, and the sociocultural sector are among the parameters investigated (Mudany, Letting, and Gituro, 2020). Customer preferences, likes, and needs present both possibilities and problems for the eye care market. The benefits of fashion branded ocular wear, as well as the burgeoning trend in eyeglasses as a wardrobe component, is widely trendy boosted by rising socioeconomic groupings (Leninkumar, 2017). The market for optometric goods and services will be driven by the aging population in the UK and around the world. Alternative vision correction procedures, such as laser, are also obstacles, as is a shortage of skilled personnel.
Changes in purchase techniques, such as digital spec sales and internet booking registration, with patients receiving a message confirming their reservation details and booking information when making an online reservation. The company's leadership and administration are carried out utilizing IT solutions accessible via a private server, allowing for better versatility in corporate operations (Grewal et al., 2020). Specsavers has developed the new generation one system for record-keeping in order to create an integrated accounting procedure for its 800 UK and European locations (Scepsavers, 2022). The creation of next-generation spectacles will also open up novel lens cost-cutting and development opportunities.
The legal factors are another significant area that also cast their influence on the organization. The company has to maintain the government rules and regulations, consumer protection act, employment act, and other legal rules for operating the organizational functions and operations. Without maintaining the legal areas the company cannot operate the services (Ahsany, Alamsyah, and Al-Fatih, 2020). When the legal processes change, the company also needs to change its functions as per the requirements. Moreover, the safety and security of the employees are also required to be controlled as per the legal structure. Employee health and safety rules are also important to be maintained for organizational growth and development (Ahsany, Alamsyah, and Al-Fatih, 2020). When the company is legally structured and follows all the rules and restrictions, it can enhance its brand value and image.
Environment protection act is also important to be maintained within the workplace. The managers of the company need to obey all the rules set by the government of the country to safeguard the environment (Ramanathan et al., 2017). By maintaining corporate social responsibility to safeguard and protect the environment, the company can increase customer satisfaction and loyalty. The use of plastic packaging needs to be reduced for improving the environment's health and well-being. The energy sources that are used for the organization for example oil sources have a huge impact on the organizational operations. It directly impacts the environment. It also increases the chances of tax, fines, and a rapid increase in the cost of raw materials.
Moreover, the carbon taxation policy has also been imposed in many organizations. It has therefore posed a great threat to the company. Based on these rules and regulations, the prices of the products, product development, operational management, and functions of the company change (Kotlikoff et al., 2021). It is important to use products that have minimal or no environmentally adverse effects. Eco-friendly products can be used in the packaging system for reducing environmental effects.
As per the SWOT, and PESTEL analysis studied, the eye care industry is moving in the direction of being more socially responsible and customer-focused (Gao et al., 2017). Specsavers should view environmental changes as an opportunity rather than a threat. Specsavers must regard personnel as a key to achieving a competitive edge in a fast-paced industry if it wants to thrive in the long run.
At the same time, both human resource and company strategies are developed. Human resources must be a driving force in Specsavers' long-term business strategy (Banfield, Kay, and Royles, 2018). It is critical to place a strong emphasis on improving optometrists' skills through intensive training and continued investments.
The implementation of a carbon tax would have a significant influence on the future of Specsavers, jeopardizing the company's ability to continue offering low-cost eyeglasses (Kotlikoff et al., 2021).
The internet will continue to have an impact on how Specsavers conducts business. It is currently primarily utilized for online appointment booking, but as societal norms evolve, clients with busy lifestyles will prefer to purchase frames and contact lenses electronically (Grewal et al., 2020). Specsavers has built a digital framework to track the payment of purchase orders in a methodical manner. Significant time and operating expenses have been saved as a result of the increased effectiveness and storage capacity.
According to the company's SWOT analysis, its strengths include a wide range of goods and a reputation for high-quality optometrists, as well as advances in cutting-edge vision and hearing-aid innovation and global impact. Specsavers is a brand with a lot of brand image and recognition for providing cheap eye care, with operations in a range of nations in Europe as well as around the world (Grewal et al., 2020). Furthermore, the company usually supplies several designer optical products to its big merchants. As an outcome, it may be able to join the e-commerce business by taking orders online for creative pictures.
More money should be raised, and business relationships should indeed be established. Existing and future competitors, the financial meltdown, and prospective takeover proposals all pose threats to the organization due to its low brand equity in the innovative market (Shabbir, Khan, and Khan, 2017).
Depending on the environmental policies the organization needs to improve the functions that can increase the firm’s performance. Maintaining all the environmental regulations, the company can enhance boost corporate social responsibility (Khan et al., 2020). It is therefore very significant for organizational development. For overcoming the threats of the new companies, the company needs to make decisions for bringing innovation in the eye wares frames, collections, and styles. Product innovation can help the company in boosting customer engagement. Product innovation can also help in enhancing brand image (Gao et al., 2017).
It can be stated that the micro and macro elements can help the organization identify the main weak and strong areas. By identifying the major internal and external impacts the company can make effective decisions to overcome those impacts. It can also highlight the crucial areas for helping the organization cope with the various challenges. The analysis of the micro and macro environment has helped in developing strategies for dealing with the external barriers. Innovation in product development is very important to increase the competitive advantage of the company.
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