Understanding Retail - identify the competitive factors in the retail environment in a selected organisation

Topics: Management, Economics, Environment Pages: 5 (1619 words) Published: June 2, 2014
Understanding Retail
P4: Identify the competitive factors in the retail environment a selected organisation faces.

Organisations are effected by many different competitive factors that they are forced to face. Organisations will try to strike competitive advantages by marketing using the fours P’s; product, price, place and promotion. The four P’s will influence all organisations to analyse the structure of their marketing as it is vital that they override the competitive factors between all businesses surrounding them. By using strategy (what they are going to do) and tactics (how they are going to do it) the organisation will gain an advantage as it will give them a structured plan. An organisation will be influenced to confront the four P’s in a variety of ways depending on the competitive factor affecting them at that specific time. Competitive factors can and will arise in a variety of situations in both macro and micro environments. A macro environment a big environment which businesses cannot control easily. Businesses have to ‘roll with the waves’ and make compromises in order to control the environment. Marco environment contains principle tools that can help them find solutions. A micro environment is the opposite. It is the immediate environment that surrounds the business therefore a smaller environment that is easier to control. Micro environments use Porters Five Forces as a tool. The tools that are used will depend on what is effecting the organisation. The tools that will be considered for use are PEST, STEEPLE, SPELT and PRESTCOM. All of these are important aspects to consider when competing. Political, Economic, Social cultural and Technological features of the businesses in both the Marco and Micro environments will all have to be reflected upon when in a competitive position. The other tools will also be used by organisations depending on what is effecting them at that specific time. It is vital for organisations to use these tools as they will help the business work on the progression of their ability to compete. These are the tools that businesses may have to consider using:

Social
Technological
Economical
Environment
Political
Legal
Education/ethic

Social
Political
Economical
Legal
Technological

Political
Regulation
Economical
Social
Technological
Competitors
Organisation
Marketing
My chosen organistation; Topshop, can be effected by both Marco and micro environments. A political aspect may affect them. Business loans that the organisation have taken out may be increased due to the bank of England raising the interest rate. This will result in Topshop paying more than they bargained for. This will affect the rest of their business like the amount of stock intake they can manage financially and the speed that the bills get paid at; some may be overdue due to lack of money because of an increase in interest rates. Organisations in both Marco and micro environments will have to take the five forces in to consideration depending on their competitive position and how the five forces are affecting them.

Topshop may have to consider the PEST analysis during competing in order to allow their business to continue to run smoothly. The PEST analysis will encourage them to reflect on the external influences that are important and the significance of any changes for the future of your organisation.

Political refers to anything relating to or performed by the government that affect the supply and demand or business development in general. Government regulations and policies are the main sources that impact the business environment.

Economic refers generally to the macro-environment financial factors. These factors may possibly have a high impact on the business environment which cause the firm to be unable to control it. The worst affect it will have is adaptation. It can only adapt the businesses strategies and financial policies. These economic factors may include the...
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