Unit 7.2 Global Business Strategy with Sainsbury’s (GC0353)

Table of Contents

Introduction.

Activity 1.

1.1 A review of the techniques to analyze the environment and an assessment of their suitability

1.2 An analysis of the micro and macro environments of the business using techniques reviewed in the first part of your report

1.3 An analysis of how the international business environment impacts on your chosen organization

1.4 An assessment of the benefits, opportunities, and challenges of globalization Sainsbury’s.

1.5 The extent of globalization on organizations.

1.6 Structures of different organizations operating in international markets.

Activities 2.

Activity 3. 1

3.1 Sainsbury Current & Prospective Customers.

3.2 Sainsbury Corporate Strategy for Customer Satisfaction.

3.3 Sainsbury Marketing Strategy.

3.3 Electronic Supply Chain of Sainsbury:

3.4 Real-time communications.

3.5 International Scale Economies.

Conclusion.

References.

Introduction

Global Business Strategy can be defined as the business strategies engaged by businesses, companies, or firms operating in a global business environment and serving consumers throughout the world. Global business strategies are closely related to the business developing strategies adopted by businesses to meet their short and long-term objectives. The short term goals of the business would be related to improving the day-to-day operations of the company while the long term objectives are generally targeted towards increment of the profits, sales, and earnings of the company, in the long run, ensuring growth and stability of the business and dominance over the national or regional market.

Activity 1

1.1 A review of the techniques to analyze the environment and an assessment of their suitability

A business environment can be analyzed using PESTLE and SWOT analysis techniques. A PESTEL analysis is a framework or tool used by marketers to analyze and monitor the macro-environmental (external marketing environment) factors that have an impact on an organization. The result of which is used to identify threats and weaknesses which are used in a SWOT analysis.

PESTEL stands for:

• P – Political
• E – Economic
• S – Social
• T – Technological
• E – Environmental
• L – Legal

Let’s look at each of these macro-environmental factors in turn.

Diagram: PESTLE Tool   Source: Palmer (2014)

Political Factors

These are all about how and to what degree a government intervenes in the economy. This can include – government policy, political stability or instability in overseas markets, foreign trade policy, tax policy, labor law, environmental law, trade restrictions, and so on. It is clear from the list above that political factors often have an impact on organizations and how they do business. Organizations need to be able to respond to the current and anticipated future legislation and adjust their marketing policy accordingly.

 Economic Factors

Economic factors have a significant impact on how an organization does business and also how profitable they are. Factors include – economic growth, interest rates, exchange rates, inflation, disposable income of consumers and businesses, and so on. These factors can be further broken down into macro-economical and micro-economical factors. Macro-economical factors deal with the management of demand in any given economy. Governments use interest rate control, taxation policy, and government expenditure as the main mechanisms they use for this. Micro-economic factors are all about the way people spend their incomes. This has a large impact on B2C organizations in particular.

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Social Factors

Also known as socio-cultural factors, are the areas that involve the shared belief and attitudes of the population. These factors include – population growth, age distribution, health consciousness, career attitudes, and so on. These factors are of particular interest as they have a direct effect on how marketers understand customers and what drives them.

Technological Factors

We all know how fast the technological landscape changes and how this impacts the way we market our products. Technological factors affect marketing and the management thereof in three distinct ways

Environmental Factors

These factors have only really come to the forefront in the last fifteen years or so. They have become important due to the increasing scarcity of raw materials, pollution targets, doing business as an ethical and sustainable company, carbon footprint targets set by governments (this is a good example were one factor could be classed as political and environmental at the same time). These are just some of the issues marketers are facing within this factor. More and more consumers are demanding that the products they buy are sourced ethically, and if possible from a sustainable source.

Legal Factors

Legal factors include – health and safety, equal opportunities, advertising standards, consumer rights and laws, product labeling, and product safety. It is clear that companies need to know what is and what is not legal in order to trade successfully. If an organization trades globally this becomes a very tricky area to get right as each country has its own set of rules and regulations.

1.2 An analysis of the micro and macro environments of the business using techniques reviewed in the first part of your report

SWOT analysis of Sainsbury’s

Strengths:

Sainsbury’s is one of the largest retailers in the UK. As mentioned before, Sainsbury’s has a market share of over 16 percent and serves over 90 million customers a week. Sainsbury’s has a wide range of products (over 30,000) which is really convenient for its customers. Because Sainsbury’s has a range of products and services, it means that a lot of its customers can shop for almost everything just by visiting one of the stores. Sainsbury’s is also well known for its good customer service……………

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