Business Environment Assignment Sample

Introduction Of Business Environment: Sectors & Market Structures Assignment

Business environment refers to the external and internal factors that affect the operations of a business (Hamilton and Webster, 2018). Businesses can operate within the public, private or third sector, with each sector having its own unique characteristics and challenges. The report will begin by defining each sector and providing examples of businesses that operate within them. Study will also consist of different types of E-Commerce marketplaces and various types of marketplace structures.

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Global, Local and National businesses refer to the scope of operations of a firm and the geographic region where it primarily conducts its business activities. The meanings are as follows:

Local Business: A local business is a company that operates within a particular geographic region, usually within a specific city, town, or community. The company's target market is the local population, and it provides products or services to meet the needs of the community. Examples of local businesses include small mom-and-pop shops, local restaurants, and small service providers (Williams, 2023). Here is a example of local business:

The Great Yorkshire Shop in Leeds is a perfect example of local business because it is located in Leeds, West Yorkshire, and specialises in promoting and selling locally made products. The store is focused on displaying the work of over 70 independent Yorkshire-based artisans and producers (thegreatyorkshireshop.co.UK, 2023). By sourcing products from local producers, The Great Yorkshire Shop is helping to support the local economy and promote the work of local businesses. The store's commitment to promoting the unique products and culture of Yorkshire also contributes to the local community's sense of identity and pride. Furthermore, the shop's physical location in Leeds means it is accessible to local customers who can easily visit the store and support the local businesses featured there. Overall, The Great Yorkshire Shop's focus on promoting local artisans, producers, and businesses, and its contribution to the local economy, make it a quintessential example of a local business in Leeds.

Figure 1: The Great Yorkshire Shop

(Source: thegreatyorkshireshop.co.UK, 2023)

National Business: Is a company that works in multiple regions inside a country. These companies have a broader customer base than local businesses and may have multiple locations or franchises throughout the country. National businesses often have a national marketing and advertising strategy to promote their brand and products. Examples of national businesses include fast-food chains, retail chains, and service providers that operate in multiple states (Williams, 2023). Here is a example of National Business:

BP plc, also known as British Petroleum, is often referred to as a national business because it is headquartered in the United Kingdom and has significant operations and assets in the country. BP was founded in 1909 as the Anglo-Persian Oil Company and played a major role in the development of the oil industry in the Middle East (bp.com, 2023). Over the years, BP has expanded its operations internationally and has become one of the world's largest oil and gas companies. However, its roots and headquarters remain in the UK and the company is listed on an Exchange. BP is also a major employer in the UK, with thousands of people working for the company in various roles.

Figure 2: British Petroleum

(Source: bp.com, 2023)

Global Business: A global business is a company that is functioning in numerous countries and has a worldwide presence. These companies have a global customer base and may have offices, factories, or distribution centres in multiple countries. Global businesses often have a strong brand presence, and their products or services are recognisable worldwide (Williams, 2023). Here is a example of a Global Business:

Coca-Cola is a global business because it operates in many countries around the world and has a dynamic presence in the international marketplace. The company is one of the world's major beverage manufacturers, generating and distributing a vast range of non-alcoholic beverages, including Coca-Cola, Fanta, Sprite, and many others (Coca-colacompany, 2023). Coca-Cola was first introduced in the United States in 1886 and has since expanded its operations globally. Today, the company operates in over 200 countries, with a distribution network that reaches over 1.9 billion customers every day. Coca Cola’s global success can be attributed to several factors, including its iconic brand image, strong marketing campaigns, and innovative product development. The company has adapted its products to meet the unique tastes and preferences of local markets, leading to the introduction of different flavours and variations of its beverages in different countries.

Figure 3: Coca Cola

(Source: Arun, 2023)

The terms public, private and third sector are used to describe different types of organisations based on their ownership and the purpose for which they are established. The meanings of these sectors are as follows:

Public Sector: The public sector consists of administration that belongs and is conducted by the government. The primary objective of the public sector is to offer core assistance and utilities to the public, such as healthcare, education, public safety, and transportation. Taxpayers fund the public sector, and the government is responsible for their management and oversight (bbc.co.UK, 2023). Here is a example of a Public Sector:

The National Health Service (NHS) is a public sector organisation in the UK because it is owned and funded by the government and provides healthcare services to all UK residents regardless of their ability to pay (GOV.UK, 2023). The NHS was established in 1948 with the aim of providing universal health care access to everyone in the country, regardless of their social or economic status. It is a publicly funded system, which means that it is funded through taxation and national insurance contributions, and the services provided are free at the point of use. As a public sector organisation, the NHS is accountable to the government and the public, and its operations and finances are subject to scrutiny and regulation. The government sets policies and provides funding for the NHS, while the NHS is responsible for delivering healthcare services in line with government priorities and objectives.

Private Sector: The private sector comprises organisations that belong and run by private individuals or companies. The primary purpose of the private sector is to generate gain by providing goods or services to customers. Private sector organisations are generally funded through investment, loans, and revenue generated from their operations (bbc.co.UK, 2023). Here is a example of Private Sector:

Tesco is a private sector organisation in the UK because it is not owned or funded by the government and operates with the aim of generating profits for its shareholders. As a private company, Tesco is owned by its shareholders, who invest their money in the company with the expectation of receiving a return on their investment. This ownership structure allows Tesco to operate with a degree of independence and flexibility, without direct government involvement or control. Tesco is a British intercontinental grocery and general merchandise vendor, based in Welwyn Garden City, Hertfordshire, UK (Tescoplc.com, 2023). The company was set up in 1919 and has since matured to become one of the main retailers in the world, with operations in Europe and Asia. Tesco manages a range of retailing formats, containing hypermarkets, supermarkets, online retail platforms and convenience stores. The company's primary focus is on selling groceries and household goods, but it also has a range of other products and services, including financial services, clothing and electronics.

Third Sector: The third sector, also known as the voluntary or nonprofit sector, comprises organisations that are neither government nor private sector entities. The primary purpose of the third sector is to address social, environmental, or cultural needs and to promote the public good. Donations, grants or membership fees typically fund third sector organisations (bbc.co.UK, 2023). Here is an example of a Third Sector:

The British Red Cross is a third sector organisation in the UK because it is a non-profit organisation, which operates independently by the government as well as for the benefit of the public. The third sector, also known as the voluntary sector or non-governmental sector, is made up of organisations that are neither public sector nor private sector organisations, and are typically driven by a social or charitable mission. The British Red Cross is a humanitarian organisation that provides a range of services related to health and social care, emergency response, and international humanitarian aid. The organisation was established in 1870 and is part of the International Red Cross and Red Crescent Movement, which is a worldwide network of charitable arrangements. The British Red Cross provides a range of services to people in crisis, including supporting people affected by conflict, natural disasters, health emergencies, and social isolation. The organisation's activities are focused on four main areas: supporting refugees and people seeking asylum, responding to emergencies and disasters, providing first aid training and support, and promoting social inclusion and community resilience.

The various types of E-Commerce marketplaces and their meanings are as follows:

• Business to Consumer (B2C): The term "business to consumer" (B2C) describes a particular sort of commercial transaction in which companies offer their products or services directly to individual customers. B2C refers to businesses that prioritise gratifying the requirements and desires of specific clients over those of other companies or organisations.
• Consumer to Consumer (C2C): Consumer to consumer (C2C) refers to a sort of business transaction in which one individual consumer sells another individual consumer directly. In other terms, C2C entails business dealings between two private parties.
• Business to Business (B2B): Businesses selling their products or services to other companies or organisations are said to be engaging in business-to-business (B2B) transactions. B2B refers to business-to-business transactions between two companies or organisations (Johnson, 2017).
• Consumer to Business (C2B): A sort of commercial transaction known as "consumer to business" (C2B) involves one or more customers offering goods or services to other companies or organisations. In other words, business-to-business (C2B) transactions involve business and consumer interactions.

Meaning of the Various Types of Market structures

The different types of market structures and their meanings are as follows:

• Perfect competition market structure: a large number of small businesses that provide the same goods or services represent a market structure termed as perfect competition. In a market with perfect competition, there are no entry barriers, allowing new businesses to enter or leave the market with ease (Slocum, Aidoo and McMahon, 2020). Moreover, all businesses have equal access to information and technology.
• Monopolistic competition market structure: a large number of businesses that provide comparable but distinct goods and services define a market structure termed as monopolistic competition. Firms have some level of market power in a monopolistically competitive market, which means they have some degree of price setting authority.
• Monopoly market structure: a single producer of an original good or service defines this market structure with no direct competitors. The company has a sizable amount of market power, which gives it the ability to set prices above the level of the competition and limit output. High entry barriers make it demanding for new businesses to join the market and challenge the monopolistic corporation.
• Oligopoly market structure: A small number of large enterprises that control the market make up this market structure. The businesses can affect prices and output thanks to their significant market strength. High entry barriers make it demanding for new businesses to join the market and compete with the market leaders.

Conclusion

The business environment is a complex and dynamic concept that is influenced by a range of internal and external factors. This report has provided an overview of the different types of businesses that operate at the global, local, and national levels, together with the public, private, and third sectors. The report also has identified several classes of E-Commerce marketplaces and various types of marketplace structures.

References

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Tescoplc.com (2023). About TESCO Plc‌[Online] Available at: https://www.tescoplc.com/about/ [Accessed on: 22.02.23]

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