Business & Business Environment of Iceland Food Limited

University: Regent College London

  • Unit No: 8
  • Level: Undergraduate/College
  • Pages: 20 / Words 5068
  • Paper Type: Assignment
  • Course Code: L/508/0485
  • Downloads: 3162
Question :
As all the students are required to maintain the types of business with their functions and the ways through which it is being operated in all contemporary and business environments. As relationship in all different stakeholders that are examined as along with the determination of how all the external environmental factors can influence in decision making.Elaborate the businesses with different types, sizes, and scopes.What is the relation of different business functions which is performed at Iceland Food Limited with a link to organization structure?What are the positive and negative influences in the macro-environment factors in the operations of Iceland Food Limited?Explain the internal strengths and weaknesses in the business with link external environment factors.
Answer :
Organization Selected : Iceland Food Limited


Business environment refers to the combination of internal and external environment of an organisation which may or may not affect the survival and profitability of an enterprise. These factors affects the operations and decision making of the company (Business Environment. 2018). Iceland Food Limited is an supermarket retailer chain based in United Kingdom, the seller of frozen foods including prepared meal and vegetables. It operates 900 stores through out UK. This report describes various type of organisation with their legal structures, size and scope (Asif, Garvare and Ahmad, 2011). In addition to this, project also contains PESTEL &amp SWOT analysis of Iceland Food Limited along with strength &amp weaknesses of macro environmental factor present in external environment of company. This analysis help Iceland Food Limited in formulating strategies to get success and in achieving competitive advantages within marketplace.


P1 Various types and purpose of organisation with legal structure

Business organisation refers to the group of people who works together in order to accomplish similar objective. It is a legal framework which defines the profit dispersal, company's structure and liability risk. Business structure are of three types such as private, public and voluntary organisation that are explained below.


Profit organisation

Non-profit organisation

Non-government organisation


Profit corporation is a company which work for earning profit and is concerned with its own interest.

Organisation which is setup with an agreement that revenue, profit or any other amount which is earn generated by business will stay within the organisation and is not shared by any member.

NGO is an non-governmental organisation which is created by ordinary citizens that operates its function autonomously.


Its main aim is to generate maximum profit from its operations.

Main aim is to promote art, research, commerce or any other useful purpose.

Main objective of NGO is to work for the betterment of society as well as bringing awareness in society for human right, women empowerment etc.

Here are discussed some other forms of organisation on the grounds of its size that include small, medium and micro organisations elaborated as below:

Micro enterprise:- A micro enterprise is a small business unit started with a small investment and generally operate with less than 10 people (Gharajedaghi, 2011).

Small enterprise:- A business which are privately owned and managed by sole proprietorship or partnerships which comprise employees more than 50 employee.

Medium-sized enterprise:- A business having strength of its employees not more than 250 is considered as medium scale enterprise.

Private enterprise:

Business organisation which is managed by private individual instead of being managed and controlled by government is known as private enterprise. It carry out its operations for earning profit and company can issue stocks but are not eligible to trade in public exchange. Iceland Food Limited, a British supermarket retailing chain store situated in UK is suitable example of private enterprise (Bhaduri and Ha-Brookshire, 2011).

Purpose:- Its main purpose is to offer frozen food, value, innovation and convenience to its customers to achieve long term profitable growth.

Legal Structure of private organisation:

  • Partnership: A partnership is a formal agreement between two or more parties in which partners come up with their capital, skills and resources to operate business activities with a common goal. Under this, parties shares profit as well as losses, partners have unlimited liabilities.
  • Sole proprietorship: A sole trade or sole proprietorship refers to a business which is owned and managed by one individual, having no legal restriction in between individual and business entity. Owner is liable to bear all the profit and loss incurred in business.
  • Limited company: It is another type of private enterprise which are of two types that is limited by guarantee and limited by shares.

Public Organisation: These Public sector company refers to the organisation which is owned and managed by the government, which put more emphasis on providing services to its citizens (Cavusgil and et. al., 2014). Crown Prosecution Services is a good example of public sector company which work toward criminal indictment and for reducing the crime offense that are present in community.

Purpose:- Main purpose of CPS is to work with police and investigative agencies during criminal investigation and support them with legal advices which help them to decide the type of punishment for the criminal.

Legal structure of public enterprise:

  • Central government: A central government is the government of nation-state which enjoys power at various level delegated to it through its state members. At this level , rules and regulations are formulated for state as well as local government.
  • State government: State government is the government at a level below central government and support them in implementing various legal practices. Under this the the legislative, fiscal and executive authorities of government is limit to particular state (Chetwood and et. Al, 2014).
  • Local government: This unit is the lowest tier of government which manages the public administration of cities, towns, districts etc. of a country. Local government handles day to day operations of public firm.

Voluntary organisation:- A voluntary organisation consists of a group or union who get associated to form a body or organisation. These organisations are flexible, independent, secular and non-profit who generally work for the welfare of the society. Save The Children is the example of voluntary organisation which work for improving the lives of children by providing health care, better education as well as by providing first aid at the time of natural disasters.

Purpose: Main purpose of this organisation is to improve the food and healthcare access of children, providing them better education and helping the children who get separated from their parents because of extreme poverty, natural disaster and exploitation.

Legal structure of voluntary organisation:

  • Unincorporated associations:- This association consists of a group which work for the benefit of the society and they are not recognised as a legal entity and are managed by management committee.
  • Incorporated organisation:- This organisation is recognised in law and is considered as an separate entity from its director and trustee (Crane and Matten, 2013). The directors are considered as an agent for the company and is not personally liable for company's debt.
  • Charitable company:- It is a limited company formed for achieving the charitable aim. These companies are controlled and managed by charity commission, limited by guarantee and not by share.

P2. Scope and size of various type of enterprise

There are different kinds of firm that operates in business environment. It is very necessary to understand their purpose which helps in achieving their set goals or objectives. Every organisation has their own size and scope which are as follows:

Iceland Limited

  • Products and services: This is a private firm which offers variety of food products that are frozen goods, prepared meals &amp vegetables and non frozen items which includes meat, dry goods and dairy products.
  • Mission and vision: Company's vision is providing quality, safe and ethically sourced food. Mission of Iceland limited is to provide good quality of food.
  • Size and objectives: It has more than 900 stores over the United Kingdom and also 40 franchise and own stores across Europe.

Crown prosecution services

  • Products and services: This is a public organisation which provide services related to criminal cases i.e. investigated and examined by police &amp other investigation company (Gilboy , 2016).
  • Mission and vision: The mission of the company is to provide prosecution by witness. Vision of Crown prosecution service is to help investigation company and police to solve criminal cases.
  • Size and objectives: Objective of this company is to punish the person who does misconduct and give justice to right person.

Save the children

  • Products and services: It is non government organisation that works for children's right by providing them good education, economic opportunities, health care and also give emergency aids in natural disaster &amp wars.
  • Mission and vision: Vision of the company is world where every child survives, learns and is protected. Mission of Save the children is to provide basic facilities to all children.
  • Size and objectives: It is a global non profit company which saves children more than 120 countries across the world.

Difference between large, medium and small organisation


Large organisation

Medium-sized organisation

Small organisation

Objectives and goals

The objective of large scale industry is to provide marketing facilities to small scale company. The goal of this organisation is to sale various type of raw material such as imported and indigenous for supply to small scale units.

The main objective of medium scale industry is expansion and growth of the business by satisfy demand of their customers.

Objective of small scale organisation is to maximize their profitability and productivity.

Market share

The market share of large scale industry is to operates on international level. There are huge number of stores that are located across the world.

There is less market share as compared to large scale industry. Its functioning of operations is more than small scale industry.

Small scale industry has very less market share as it operates in small level.

Profit share

The profit sharing of large scale industry is very high.

Medium scale industry has profit sharing ratio less than the large scale organisation.

The profit sharing ratio of small scale industry is very less. They have only sufficient amount by which they can operates there day to day activities.

Here is mentioned distinction between joint venture, Licensing and Franchising techniques which is mentioned as below:



Joint venture



A contract in which one party give another right to use its name and trademark to operate business practices.

Joint venture is an agreement between parties which pool their resources for achieving a particular objective

An arrangement in which company sell right to use its intellectual property or product to another person.

Training and support

In case of licensing training is not provided to licensee

In joint venture training is necessary for the employees to understand working environment and culture of one another

Franchisor provide training to franchises to maintain their quality of services.


P3 Relationship between various organisational functions and link with organisational objectives

An organisation consists of number of functional unit that perform functions differently but all units work toward the achievement of organisational objective (Kian Chong, Shafaghi and Leing Tan, 2011). Relationship between different organisational function are as follows:

  • Marketing:- This unit work toward the promotion, sale and delivering of goods &amp services to the customer in more efficient manner in order to fulfil their need. Marketing unit is highly depend on operational division for delivering product as per the customers requirement and on HR department for recruiting right candidate that can best present the product of Iceland Food Ltd. It also help in promoting and making people aware about the quality services that company offers which in turn will attract more and more customers.
  • Finance:- This is another department of an organisation which help in preparing budget and allocating finance to other units for the execution of various operations.This department help Iceland Food Ltd in minimizing the cost of company by managing fund with the help of budget statement which in turn will maximize the profit of the company.
  • Human-resource-management:- HRM is the most essential part of an organisation as its main function is to manage human resource of an organisation. Various operations performed by HR manager are recruitment, selection, training &amp development, payrolls etc. It help Iceland Food Ltd in selecting eligible candidate for their company that contribute toward the growth and success of the company (Li, and et. al., 2011).
  • Operational:- This unit word toward managing the business practices in order to bring possible efficiency within an organisation. Its main aim is to convert material and labour into finish goods in an more efficient manner for maximizing profit of an organisation. It can help Iceland Food Ltd company in managing inventory as per the demand of customers.

Various organisational structure are explained below:

  • Bureaucratic and post-bureaucratic:- Bureaucratic structure is used by large organisations that have more levels and department and the authority of decision making has to pass from various layers. In Post-bureaucratic organisation decisions are taken on the basis of consensus rather than authorities and responsibilities are shared under this structure.
  • Strategic business unit:- SBU is an autonomous organisational unit which is flexible and has its own vision and missions which are different from its parent enterprise and exercise control over factors that affect its long term performance (L&oacutepez-Gamero, Molina-Azor&iacuten and Claver-Cort&eacutes, 2011).
  • Matrix:- Under this type of structure, reporting relations are set in the form of grid rather than hierarchical. Iceland Food Limited follows matrix structure in which employees have to follow dual reporting relationship i.e. functional managers and product manager.
  • Functional Level:- In this structure company group its employees as per their area of specialisation or on the basis of common tasks. In functional organisational structure employees report to their functional manager.


P.4 Positive and negative impact of macro environment on business operations

Company creates many effective and efficient policies so that it can adopt the external macro factors. These factors can affect the company in a positive and negative manner (Meiners, Ringleb and Edwards, 2014). This helps firm in expand their operations in minimum time. Positive or negative impact of macro factors on Iceland Food limited are:

Political factors: These are the rules and regulations which are created by the Govt. Hence as a result Iceland Food Limited have to follow the rules and regulations which is created by Govt. Positive and negative impact is described below:

  • Positive impact: If Govt. has created a rule that there must be high promotion of food , organisation must use good quality of products which leads to positive and motivating factor for enterprise . Thus, it can run all operations and activities in proper manner.
  • Negative impact: Sometimes Govt. ban some products which are used by company. Through this, it cannot maintain good image in market and so they cannot enhance their reputation. This also results in reducing the profits of firm (Sekaran and Bougie, 2016).

Economic environment: Enterprise has to follow all rules and regulations which is created by Govt. Hence, company has to follow the rules and regulations. Positive and negative impact are:

  • Positive impact: If there is deflation then business has to sell products at a lower rate. This helps the Iceland food limited to earn more revenues and they can also enhance the market share.
  • Negative impact: If there is a situation where is more demand of good as compared to supply of products then it reduces the profits of . Hence, it cannot sell the fast foods and snacks to all people.

Social factors: Now-a-days, people's demand is continuously changing. Hence, firm has to create effective policies to deal with the changes. Positive and negative impact are:

  • Positive impact: Iceland food limited creates delicious food and other snacks so it can fulfil the needs and requirements of all people. This results in increasing the profits and they can also expand their operations in minimum time.
  • Negative impact: It cannot fulfil the demand and requirement of all sections of population. Hence, it cannot fulfil the demand and requirement of a particular section of population (Tayur, Ganeshan and Magazine, 2012).

Technological: There are advanced technologies which are used in market. Thus, firm has to follow this so that they can easily maintain good image in market. Positive and negative impact is described below:

  • Positive impact: Organisation can adopt the latest and recent technologies through which it can creates variety of products and delivers superior services to all people. Hence it can increase the satisfaction level of all people (T&uumlretken and et. al., 2011, June).
  • Negative impact: Sometimes business cannot adopt the recent technology due to lack of funds. This hampers the work of management. Hence firm cannot operate all activities and tasks in proper manner.

Environmental factors: Iceland food limited use various strategies so that their practices will harm less to environment.

Positive and negative impact is described below:

  • Positive impact: Due to increasing competition, Iceland food limited creates various policies so that they can easily fulfil the needs and demand of all people. Hence, this is positive and motivating factors.
  • Negative impact: Sometimes business cannot fulfil all needs and requirements of people. This results in decreasing of profits of firm.

Legal factors: Govt. creates various rules and regulations so that enterprise can follow it. Positive and negative impact is described below:

  • Positive impact: Iceland food limited must follow the rule thus it treats all staff members in equal manner. Hence, all activities can run in proper manner (Vaiman, Sigurjonsson and Davidsson, 2011).
  • Negative impact: Sometimes Govt. can ban some product and material and hence it cannot operate all activities in proper manner. This results in decreasing of market share of Iceland food limited.


P5 Internal and external analysis to determine strengths and weakness

Company has to identify the strength and remove weakness. It also create various policies so that it can adopt opportunities and can remover the threats (Wack, 2017). Internal environment of business is the elements that are current employees, corporate culture and management that can be manageable and controlled by manager. It is very important to analysis intrinsic environment which helps in achieving the set objectives.

SWOT analysis of Iceland Food is described below:


  • Iceland Food Limited have adopted low price advantage.
  • It has created good marketing strategy related to promotion and pricing.



  • Iceland Food Limited do not create innovative policies and strategies and hence, they cannot maintain good image and position in market.
  • Iceland Food Limited has lack of experience of creating products and there is no research and development in company.


  • Iceland Food Limited have a opportunity to create friendly and stable relations with other companies.
  • There is a positive working environment and company can create policies so that it can adopt the economic conditions.


  • There is negative impact of many import policies.
  • Products can be consumed by all people and there is negative impact of consumption on the company. Hence Iceland food limited has to create effective policies so that they can remove the threats.

P6 Evaluate how strength and weakness interrelate with the external macro factors

Strengths and weakness of Iceland Food Ltd are interrelated with the PESTEL analysis of the company which influence on the business performance and decision making power of the manager. Iceland Foods Ltd company has low price which is good for them to expand their business operations in future (Yu and Ramanathan, 2013). Marketing strategies related to the pricing and promotion of Iceland Food Ltd is also better which help them to attract large number of people who are the part of social factor. Research and development department of the organisation is interrelated with the technological factor that highly effects on its performance and profitability. In this company use advanced technology which support them to save their cost and time (Zeng, Li and Duan, 2012).

PEST Analysis





This factor has certain role and duties in establishment of organisation. In this management have some lawful team to inculcate with different legislation and regulation of firm.

In this, Iceland Foods Ltd capable to keep different legislation and rules in a proper manner.

Iceland Foods Ltd provide their services or products in different countries so it is not simple to understand entire legislation of various nations.


In different nations, there are certain economic situation which effects on the business performance and profitability. There are some nations which accomplish positive effects on business.

In Asia, Iceland Foods Ltd condition is better so it is good for them to accomplish better outcomes in an appropriate and essential way.

Economical factor extremely impacts on business profit and productivity in an adverse manner. It is the main disadvantages which is not good for the future development of company at international level.


The main motive of Iceland Foods Ltd is to to provide effective and better quality of products in order maintain standard of the society.

In this, activities of corporate social responsibility highly support in order to enhance product quality as well as maintain better goodwill and image of Iceland Food Ltd at ma

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