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Business Environment Assignment: Woolsworths


Context: Contemporary businesses cannot afford to ignore the environments in which they operate. To navigate this vast and ever-changing landscape, businesses must keep a keen eye on the external factors that influence it. Customer behaviour, government regulatory and economic policy, competitor strategy and public opinion all impact on a firm’s success. The environmental scan report is an effort to identify these factors and propose solutions to the risks they pose.


Executive summary
Is business environment assignment has shed light over the contemporary business environment with concern to the organisation of Woolworths. Within the first portion, the content has been dealing with the critical evaluation of the firm with the enacting external forces. Apart from such, an analysis has been procured favouring such. Moving further, there has been mentioned the theoretical frameworks complying with SWOT, PESTLE and that of industrial analysis favouring Woolworths. Within the final portion of this business environment assignment, a recommendation against the issues and with a conclusion has been procured.

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The aspects of business environments over contemporary basis are subjective to comply with competitive along with dynamics of the business nature. To comply with such aspects, the requirements of fresher concepts over accounting control are needed to be developed for coping with changes over contemporary environment. Favouring the context of this business environment assignment, the problem statement would be dealing with management issues for example through politics or of contemporary business environment for Woolworths concerning critical evaluation of external factors. Apart from such, there would be application of theoretical framework such as PESTLE and SWOT to comply with the challenges that are faced by the chosen organisation of Retail. Lastly in this business environment assignment there would be produced suitable recommendations along with an ending conclusion.

Critical evaluation of effect of external environment on the firm
Effective evaluation of external organisational parameters in the context of the company is necessary to predict the future transactions of the company. In order to critically evaluate the extrinsic factors that can influence organisational environment, Schaltegger & Burritt (2017) state it is essential to utilise a PEST appraisal. This analysis in this business environment assignment is done in consideration of the major factors that are capable to induce changes in company potential in a target market. These factors are behaviour of the consumers, government regulations, economic policies and strategic devices of the competitive brands.

Government regulations (Political factors)
Legal frameworks of Australian Commonwealth strive to protect rights of intellectual property of the company or its stakeholders. Food Standards Australia New Zealand Act 1991 mandates the production and sales of safe, consumable and fresh supplies to be sold by the food retailers (Food Standards, 2018). Similarly, Anti-Discrimination Act 1996 compels the companies operating in its territory to provide equal facilities to its workers, irrespective of the caste, colour, age, gender and sexuality.

Economic policies (Economical factors)
Woolworths can use growth rate of Food & Staples Retailing Industry in Australia to forecast growth trajectories in the retail sector. The rates of national economic stability has stabilised host currency and exchange rates. The LTIFR score of 6.76 can provide competitive advantages to the company (Committee for Economic Development, 2017). Skilled labour can also mandate increments in workforce maintenance costs in various business cycle stages.

Behaviour of the consumers (Social factors)
The behaviour exhibited by consumers can impact organisational culture of Woolworths. Indigenous beliefs can affect buying habits of the customers belonging from rural or ethnic groups. The wide range of products has successfully catered to different socio-economic categories in Australian society. As noted by Leonidou et al. (2015), the buying behaviours of the customers are often influenced by pricing strategies in lower economic groups. On contrary, people from higher economic groups depend on quality to make their purchasing behaviours.

Competitor strategies (Technological factors)
Organisations are driven by innovative technologies in their external environment. Lawrence & Weber (2014) comment in addition to maintaining efficient working processes, technology also impacts cognitive brand image in the market. Deresky (2017) states lack of customer relationship management databases can render the company unable to provide better quality products and services as per the needs of its customers. Competitors of Woolworths like Tesco, LIDL and Wal-Mart use extensive consumer management databases to track and manage the changes in their preferences.

PEST Analysis of Woolworths

Figure 1: PEST Analysis of Woolworths
(Source: Given by Researcher)

Analysis: The above PEST analysis in this business environment assignment has shed light on the issues that can hinder organisational progress of Woolworths. A prominent challenge that has been highlighted in this scenario is the stringent legislation of Australian Commonwealth. These regulations mandate Woolworths to abide by the ethical standards of business that can elevate its internal costs in segments of labour and workplace health and safety. Another issue is that Woolworths has yet to implement a methodical and collaborative database management system to facilitate understanding of market and customer needs.

Application of frameworks for resolving challenges faced
Five forces and industry analysis

Five forces analysis in business environment assignment

Figure 2: Five forces analysis
(Source created by author)

The business of Woolworths concerning mainly to their Safeway market channel, are with lower dependencies over their suppliers, suggesting weaker bargaining power from the supplier (Woolworths 2018). Reason for such aspect sustains to be the considerable retail amount share of 3% within Australia and that of more production being made within the retail industry. On the contrary, the substitute product threat exists to a favourable extent (Saleh & Watson, 2016). The presence of Coles as a competitor acts as a provider of substitutes through procuring similar offerings such as rewind pricing strategy to their consumers. Hence they are considered higher threats of substitutes for the products of Woolworths. Apart from such, there is copy of products through other smaller firm present within the Australian context, such as TESCO PLC.

Moving to the buyer’s bargaining power in this business environment assignment, the factual and devised demands of customers are taken to be the one of the major aspects to produce higher bargaining power for the buyers. Sch aspects are responsible for its presence under the fact of having lower customer base, increasing the buyer’s bargaining power (Kalyanaraman, 2016). Relating to such, the major competitors or rivals for Woolworths are taken to be Coles and ALDI. The rivalry exists within the retail giants are regarding the offers and other product facilitations. As mentioned above, there are similar offers from Coles and Woolworths regarding the rewind pricing strategy. Also the new entrant threat for Woolworths is taken to be lower due to having larger number of stores and maintenance of sufficient quality factor for their products (Verma, 2014). For such, the presence of any new entrant stays less concerned for Woolworths.

SWOT analysis:

Woolworths-SWOT analysis

Figure 3: SWOT analysis
(Source created by author)

SWOT analysis


Market leadership

Annual revenue of $58.9B (Refer to appendix 1)

Perception management through having 55% increment within middle class segment penetrations (Woolworths 2018)


Unfavourable position

impartial behaviour towards other market segment

Pricing wars


Use of social media being a tool for customer engagement (Zirra, 2015)

New stores management with other geographies


Competitors threat from LIDL, ALDI and Coles group

Rising material costs by 3% for both non-food and food materials

Economic recession factor

Table 1: SWOT analysis
(Source: created by author)

Concerning to that of strengths, the company is with higher market leadership with nearly 100000+ employees with higher market segmentations within the mediocre class. Through such, the global presence issue can be taken into consideration as well as to procure the positioning aspect (Ionascu et al. 2014). Through use of social media as an opportunistic tool, brand endorsement can be taken to further levels to eliminate the competitive threats from present LIDL, ALDI and Coles group. Apart from such, the implementation of stores within new geographical areas are cater to reduce the aspect of material cost rises. Furthermore, the presence of international players from other portions of the globe can hinder the aspect of business management for Woolworths.

Competitive analysis: Competitors are mainly taken to be ALDI, Coles and LIDL. Concerning to that of employee strengths, LIDL, ALDI and Coles are with employee strengths are of 92653, 100000 against Woolworths with 100000+ employees (Woolworths 2018). In this situation, Woolworths is with competitive advantage over the employee strength. ALDI is subjected to have 25% of the market share over the retail market with Coles and Woolworths having 23% and 32% market share. In case of stores procurement, Woolworths is taken to have higher stores for about 900+ complying to that of nearly 800 stores for ALDI and Coles. This enhances the competitive advantage for Woolworths against the present competitors (Gorostidi-Martinez & Zhao 2017).

There are also differentiations within promotional strategies for the present competitors for Woolworths. In case of Coles, the promotional strategy is taken to be use of patriotic slogans. Apart from such, the slogans are taken to have framings for price consciousness for their buyers. Against such, the social media usage by the Woolworths is taken to be a major advantage. Through use of social media, the concept stays evident for a detailed approach for the products of Woolworths along with having customer appreciation and demand (Arabska & terziev, 2016).

It is recommended in this business environment assignment some of the major challenges faced by the company of Woolworth are taken to be unfavourable market positioning along with industry rivalry, substitution threat and weaker supplier bargaining power. For avoiding the substitution threat, an analysis can be done regarding the market products and their uniqueness (Albescu, 2014). Complying with such, the product differentiation can be entailed. For procuring favourable market position, output and input cost are to be balanced through procuring pricing strategies. Through such, a sufficient positive extent can be achieved (Abu Farha, 2016). Apart from such, to procure lower bargaining strength of suppliers, the aspects of cost switching along with forward integration aspect can be catered.

From the above content, various conclusions can be derived. From the external analysis, issues such as stringent legislation of Australian Commonwealth are found. There are also found issues of methodical and collaborative database management system to facilitate understanding of market and customer needs. Apart from that from the SWOT analysis, the company has been found with major strengths that can be catered to remove the weaknesses and to entail the opportunities. In this business environment assignment the company is also seen with issues of the higher supplier bargaining facts with unfavourable positioning within the market. Such factors are effective to hamper cost and revenue generation for the company of Woolworths. Further, the competitive analysis subtended the company to be with favourable positive outcome in terms of the employee strength and brand promotion while having drawbacks in cases of product substitution. Business environment assignments are being prepared by our business assignment help experts from top universities which let us to provide you a reliable assignment help online service.

Reference list
Deresky, H. (2017). International management: Managing across borders and cultures. London, United Kingdom: Pearson Education.

Lawrence, A. T., & Weber, J. (2014). Business and society: Stakeholders, ethics, public policy. , New York, United States: McGraw-Hill Education.

Schaltegger, S., & Burritt, R. (2017). Contemporary environmental accounting: issues, concepts and practice. Abingdon, United Kingdom: Routledge.

Abu Farha, A. (2016). Matching organizational frame of reference and business strategy with contemporary marketing practices. International Journal of Emerging Markets, 11(4), 533-549. Retrieved from Albescu, O. (2014). THE EUROPEAN MODEL OF HONORABLE MERCHANT AND ITS RELEVANCE FOR THE CONTEMPORARY BUSINESS ETHICS*. Studia Universitatis Babes-Bolyai.Studia Europaea, 59(3), 197-211. Retrieved from

Arabska, e., & terziev, v. (2016). Organic production business model and the concept of corporate social responsibility. Journal of Economic Development, Environment and People, 5(2), 23-30. Retrieved from

Gorostidi-Martinez, H., & Zhao, X. (2017). Corporate political strategies: A contemporary literature review. Journal of Advances in Management Research, 14(3), 375-404. Retrieved from

Ionascu, V., Lepadatu, G., Bârladeanu, D., & Mersoiu, I. (2014). THE GENERALIZATION OF THE APPLICATION OF INTERNATIONAL ACCOUNTING STANDARDS IN THE CONTEMPORARY BUSINESS ENVIRONMENT. Knowledge Horizons.Economics, 6(3), 62-65. Retrieved from

Kalyanaraman, S. (2016). Situating self-employed urban women conducting business through contemporary social media. Journal of Entrepreneurship and Management, 5(2) Retrieved from

Leonidou, L. C., Fotiadis, T. A., Christodoulides, P., Spyropoulou, S., & Katsikeas, C. S. (2015). Environmentally friendly export business strategy: Its determinants and effects on competitive advantage and performance. International Business Review, 24(5), 798-811.

Saleh, A., & Watson, R. (2017). Business excellence in a volatile, uncertain, complex and ambiguous environment (BEVUCA). TQM Journal, 29(5), 705-724. Retrieved from

Verma, H. V., & Duggal, E. (2014). Business and business orientation: A perception study of insiders and outsiders. International Journal of Business Ethics in Developing Economies, 3(1) Retrieved from

Zirra, A. (2015). RECENT DEVELOPMENTS OF INTERNATIONAL BUSINESS ENVIRONMENT. Romanian Economic and Business Review, 10(4), 69-80. Retrieved from

Committee for Economic Development (2017) Regulation & the Economy The Relationship & How to Improve It, Retrieved from: [Accessed 5/9/2018]

Food Standards (2018) About FSANZ , Retrieved from: [Accessed 5/9/2018] (2018) Woolworths Retrieved from: [Accessed 5/9/2018]

Appendix 1: Revenue of Woolworth

Revenue of Woolworth

(Source:, 2018)


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