Internal business environment is inclusive of the factors within organization that has an impact on the success of the operations. The external factors comprises of factors outside the company that affect the growth of an organization. An organization has the ability to make changes based on the premise of internal along with external factors so that the performance of the organization can be augmented. The main purpose of this report is to discuss the internal and external factors that affect the business structure of Sharp Retail Limited. It also discusses the business recommendations that can lead to the growth of the company.
The internal business environment consists of factors that can result in the success of operations of an organisation. Company leadership can affect the organizational culture and strength of the employees is another important factor that can influence the organization (Price, Bailey & Pyman, 2014). The retail industry is ever evolving and it is important to provide the employees with proper training so that they can be of great service for the customer. The employees should collaborate with the departments on different ideas for the efficient working of an organization.
Funding and investment opportunity are important factors that can be of merit for the organization. Banks and credit unions can be approached and they can help in offering loan options for the retail industry. The financial institutions are very conservative and one can find it difficult to get qualified for the loans (Stewart & Gapp, 2014) An organization should have strong track record and valuable assets that can help in securing the loans. The location of the company should be strategic that can help in drawing a large number of customers. It is found that if the retail outlet is positioned in a busy location then it can help in earning revenues for the company.The retail store manager should oversee the running of the retail store and should be able to maximise the shopping experience by focussing on the aspect of cost control in relation to the operations, payroll management and that of inventory management (Golhar & Alex, 2017).
The external factors that affect the retail business are that of changes in population, usage of social media along with concern for environment. Retailers want to adapt themselves in the way in which the customers prefer to shop so they are making use of creative ways for marketing the products. The rise of environmental awareness compels the retail industry to manufacture products in a manner that can make the customers feel good about the purchase. Retailers want to offer products that are made of recycled materials. Some retail giants like Nike take back the used items and also recycle them so that they can be used for other products. Reputed computer companies like that of Dell offer recycle programs in order to make itself a coveted brand among the customer.
Another factor influencing the retail trade is that the number of people who belong to the senior population is increasing in number. Retailers should be able to market to the senior population because almost 22 percent of the Australian population will become of the age of 60 and above by the end of the year 2030 (Narayan & Chandra, 2015). Good customer service is appreciated by the customer and user friendly website can be of great help for the people belonging to the senior population. High quality of the product is appreciated by this good and so the major retailers want to keep stock of reliable goods (Naidu & Babu, 2016).
Social media is affecting the trends in retail business and social media sites can greatly help the retailers in reaching the target audience. Retailers are making use of the social media sites so that they can advertise sales and launch new product lines. Traditional methods of advertising reach the customers but advertisement on the platform of social media is easy and less expensive (Singh, 2017).
Online shopping has not rendered shopping malls obsolete but it has an impact on the way in which retailers sell products. The retailers operate websites and customers can buy products from there. Online retailing can help in adding customer support to the website by using the facility of online chat (Kandachar & Halme, 2017). Online retailers can provide the customers facility for tracking the past purchase and make recommendations on the basis of the past purchase.
Organized retail system can help in increasing the efficiency of value chain. The farmer can get a better price and produce better quality of product. Value chain gets truncated because the intermediate layers get pruned. This gives rise to an organised structure that can greatly benefit the retail industry ( Mendling et al., 2017). The consumer can purchase from these outlets because they can buy products of right quality at low price. This organized retail system can thus be of great boon for Sharp Retail Limited and can help in reducing the cost of the products.
Regional partnership agreement can be of great benefit for the retail industry and can bring economic benefits from a large number of customers. Regional trade agreements and customs union can help in elimination of the trade barriers and helps in adopting an external trade policy that is common. Retail is greatly competitive at all kinds of level- local, national and global. The retail industry is largely affected by a large number of government policy that impacts the industry more than that of any other sector. The traditional model of business that was bricks and mortar is evolving and retailers are moving to that of multichannel operation. E-commerce and mobile commerce have greatly changed the scope of the retail business (Bello-Orgaz, Jung & Camacho, 2016). Re-engineering the retail business can help in integration of different kinds of sales channels in order to provide a seamless experience. The different option that a customer gets in relation to browsing and purchasing is increasing at a rapid pace in the modern age. These new channels have a great impact on the shopping center and this is leading to reduction in the number of physical stores. It has created the need for new kind of retail job role. Customer experience is of vital importance for the retail industry and good customer experience can lead to increase in sales (Spieth, Schneckenberg & Ricart, 2014). The retailers should be flexible and prepared so that they can adapt to the changing times.
Globalisation is another important factor that had a great impact on the retail industry. Globalization of market is indicative of the merging of distinct national market into that of one global marketplace. The preferences of the consumer converge on the basis of some global norm and this can help in increasing the profitability of the retail business. It can pave the path to lowering the cost structure and improve the functionality of the product so that they can gain competitive advantage (Dentchev et al., 2016). Globalisation can help in declining the barrier of trade and can lead to technological changes. Successful retailers want to expand the market and they search for a new market place where they can sell their products. In order to be successful global retailers spend a large amount of time in learning about the local market and in understanding the customs of the clients. Local managerial talent can be made use of along with that of expatriate managers in order to expand the retail industry. The global retailer should be able to understand the image of the market in which they are investing.
Cultural differences exist between people belonging to different countries and employers can bring their values to the workplace. A retailer who wants to maintain the image abroad has to make sure about the fact that their image has been correctly propagated by that of the local employees who can communicate it to that of local population. Standardized transfer of the image from that of home to that of host country can prove to be quite difficult (Holsapple, Hsiao & Pakath, 2014). Customer service can prove to be the most difficult arena in relation to establishing a new market on account of cultural differences. In the scenario of a host market, exposure to the retail format can be completely new. Customers expect the personnel to oppose their emotions by making use of those which either enhance or mirror that of their own.
Conclusion:
Funding along with investment opportunity can help an organization to prosper. Bank and credit unions can help to a great extent in offering loans that can be of great help for the retail industry. Recycle programs are offered by the companies so that they can become popular among the customers. Social media sites can help the customers to reach the target audience and thus reach a large number of people. They can launch the new product in the website and thus make the consumers aware about their innovative product. Organized retail system can contribute to a great extent in increasing efficiency of value chain.
References:
Bello-Orgaz, G., Jung, J. J., & Camacho, D. (2016). Social big data: Recent achievements and new challenges. Information Fusion, 28, 45-59.
Dentchev, N., Baumgartner, R., Dieleman, H., Jóhannsdóttir, L., Jonker, J., Nyberg, T., … & van Hoof, B. (2016). Embracing the variety of sustainable business models: social entrepreneurship, corporate intrapreneurship, creativity, innovation, and other approaches to sustainability challenges. Journal of Cleaner Production, 113.
Golhar, D., & Alex, A. (2017). Training and Development: Role of Organized Retail Organization in Bridging the Skill Gap. International Journal of Research in Organizational Behavior and Human Resource Management, 5(2), 25-33.
Holsapple, C., Hsiao, S. H., & Pakath, R. (2014). Business social media analytics: definition, benefits, and challenges.
Kandachar, P., & Halme, M. (Eds.). (2017). Sustainability challenges and solutions at the base of the pyramid: Business, technology and the poor. Routledge.
Mendling, J., Baesens, B., Bernstein, A., & Fellmann, M. (2017). Challenges of smart business process management: an introduction to the special issue.
Naidu, G. R., & Babu, R. H. (2016). Clint relationships through mobile CRM in organized retail outlets. IJSEAT, 4(2), 100-104.
Narayan, G., & Chandra, R. (2015). Factors Affecting the Purchase of Food and Grocery Products from Modern Retail Stores: An Empirical Study. IUP Journal of Management Research, 14(2), 7.
Price, R., Bailey, J., & Pyman, A. (2014). Varieties of collaboration: the case of an Australian retail union. The International Journal of Human Resource Management, 25(6), 748-761.
Singh, M. (2017). A study of factors influencing customers’ Buying patterns towards organized retail outlets. Asian Journal of Multidimensional Research (AJMR), 6(7), 62-69.
Spieth, P., Schneckenberg, D., & Ricart, J. E. (2014). Business model innovation–state of the art and future challenges for the field. R&D Management, 44(3), 237-247.
Stewart, H., & Gapp, R. (2014). Achieving effective sustainable management: A small?medium enterprise case study. Corporate Social Responsibility and Environmental Management, 21(1), 52-64.
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