Part 1

LO 1
Explanation of different type, size and scope of the organization:
P1: Different types and purposes of organization
There are different types of organizations are:

 Sole trading organization: As opined by Shetzeret al. (2014), the sole

trading organization is that kind of organization that is entirely privately owned
and maintained by a single person and that person is liable for all of the loss
and profit.
 Partnership organization: Two or more people own partnership
organization, and they shared all of the loss and profit. For example, FAB.
 Limited organization: A limited organization is that kind of organization in
which the ownership can be easily transferred, and it is owned by the board of
directors (Schiffer and Weder, 2010). For example, Associated British Foods
Plc. To complete this assignment, the learner has selected one sole trader
organization and one Limited organization. Name of the sole trader
organization is Zaffirson food and name of the limited organization is
Associated British Foods Plc related with the food safety.
Purpose of the Zaffirson food (sole trading) is:

 Increase profitability
 Provide good quality and fresh food to the customers
 Maximize the sales revenue
On the other hand, the purpose of Associated British Foods Plc. is:

 Strong and sustainable leadership position in the market

 Serve customers by providing fresh food items at low costs
 Offer different types of food items to the customers
P2: Size and scope of various types of organizations
The size of Associated British Foods Plc. is built with more than 10000
employees. Along with that, their revenue is £12,800 million and operating
income is £947 million. The scopeof their work is to serve nationally as well as
international customers with their different business segments like Grocery,
sugar, ingredients, retail and agriculture (www.abf.co.uk, 2016). The size of
Zaffirson food is built with only ten employees. Their revenue is £17000, and
their operating income is £950. Their scope of work is to serve different type
of food and beverages items to the national customers and earn a huge profit
from them.
M1: Analyzing how structure, size, and scope of various types of
organization are linking with business objectives and the products and
services offered by organization:
Structure, size, and extent of any organization are connecting with the goal of
the business organization. It is seen that any organization set a huge target as
their objective only when they have a good organizational structure. If the
organization have few people in their organizational structure and no one has
knowledge regarding their role and subordinate then it is not possible for them
to reach the target because then it is impossible to achieve this because of
less clarity in the role. On the other hand, any business organization set their
objective based on theirsize. If the size of the organization is enormous and
invests huge money, then they set the big target as their business objective
(Wardet al. 2011). However, every organization has some common objective
that is serving customers and earns profit, but the profit level differs with the
size. For example, Zaffirson food will set a small target as their objective but
Associated British Foods Plc. will set the huge target as their objective.
Organization set their business objective by reviewing their business scope. If
the scope of any organization is to serve national customers, then they will set
business objective accordingly. On the other hand, if they see that they serve
international customers then they will set their business objective accordingly.
According to the product and service, an organization set their structure, size,
and scope. If any business organization seesthat, their product does not
require massive organizational structure; then they do not set that. On the
other hand, if the scope of business of any product or services is vast only
then an organization creates massive organization size and creates a scope,
otherwise, they create small sized organization.

LO 2
Interrelationship between different functions within organization:
P3: Relationship between various organizational functions and their
linking with the structure and objectives
As stated by Alanet al. (2013),organizational structures are dependent upon
the business function of the organization because organizationalways makes
their organization structure and objective based on the role they serve to the
customers. Associated British Foods Plc. Generatesobjectives so they can
increase productivity in the organization, and they create an effective
organizational assembly so they can maintain a respectablemovement of
 command in their organization. Business function of Associated British Foods
Plc. is to serve customers with their product and services and upholda
uniformity as well as control in the organization. Consistency can be
maintained in the Associated British Foods Plc. through actual amount of
control and organization can monitor their business doings through their
structural structure (Ayyagariet al. 2012). Associated British Foods Plc. can
achieve a better functionality if everyone connected with any project has a
good knowledge regarding his or her role. Therefore, effectiveness in the
setting of real objective and organizational structure can help Associated
British Foods Plc. to achieve organizational functions because it helps
employees to know regarding their role with effectiveness.
M2: Advantages and disadvantages of the interrelationships between
various organizational functions and its impact on the organizational
structure:
Advantages:

 Inter employee relationship amongst different organizational function

assistances any organization to maintain cooperation
 It also upsurgesassociation among employees and increases effectiveness in
business
 It escalationsthe profit level because every employee of various functional
departments shares their information.
Disadvantages:

 Every employee from various branch knows the others job responsibility and
operations of others branch so they can utilize those information to harm that
branch
 It increases competition among different functional branch.

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Part 2
LO 3
Positive and negative impact of the macro environment factor on the
operation of any business:
P4: identification of the negative and positive impact of macro
environment on business operation:
As stated by Childand Möllering (2013), in the macro environment, new risks
are always appearing, and it became harder to identify for any organization. In
the case of retail, it is not possible for any organization to reject the change as
theyraise and they have to adapt those changes. Macro environments include
economic, societal, technological, and governmental influences. Technology
has several active and negative impacts on the business operations.
Technological
Advancements can provide different business opportunities to the Associated
British Foods Plc. if they can take it. Technology opens home shopping
networks, new retail markets, web-based retailer and other online market and
provides extra online market to any organization (Craigand Campbell,
2012).Therefore, it increases point-of-sale to increasesales by allowing any
organization to process cash, debit and credit card system. However, these
technological advancements have one negative impact i.e. online customer’s
only selects those organizationsthat have real technological proficiencies. If
Associated British Foods Plc. cannot apply effective technological
advancements then they can lose their competitiveadvancements. Law,
policies, and different governmentalregulation have a positive and negative
impact on the business. If governments help any Associated British Foods
Plc. by providingdifferentgovernmental assistance, loan, and subsidiaries and
assist them to establish their organization then it can positively help any
organization. On the other hand, tax rates on any corporate organization may
negatively affect any organization.
A robust economy canincreasethe disposal income of customers, increase
their sales and help them to sell more goods and services (Demirguc-Kuntet
al. 2011). On the other hand, on the lethargic economy may decrease the
disposal income and causes less amount of spending in the market. Afterthat,
it leads to declining level of sales and forces retailers to lower their pricing
strategy. The retail industry is always under pressure to become a socially
responsible organizationas if they must sell environment-friendly products,
removing controversial products from the market, placing warranties in the
market, etc. However, there are several cases where social factors and
government overlap each other in different areas and may harm different
organizations.
M3: PESTLE Analysis:
 As Associated British Foods Plc. is operating around the globe
(they are operating in Europe, Africa, China, UK, Portugal,
Spain, Belgium, US and many more countries) so the
performance of them are highly influenced by the politics and
legislations of those countries.
To employ labors, governments encourage organizations to
Political factor hire employees by providing them a flexible, locally based and
average paid jobs (Fogel, 2011). Along with that, UK
government has recently developed a tax that affects the
operation of Associated British Foods Plc. In the year of 2011,
the VAT rate of Associated British Foods Plc. Became 20%
from 17.5% that increases the revenue of 13 billion pounds but
decreases the profit of the differentorganization.
UK economy is now showing the positive signs from the
inflation and economical crisis. In the recent times, their GDP
was estimated to be the 2.7% higher than the previous.
Economical factor Therefore, this growth results in a growth of Associated British
Foods Plc. However, it will take sometimes to increase the
monthly disposal income of the citizens so it will take time to
increase a growth in their revenue.
In the recent times, the demand of the customers has also
changed, and they started to buy more fresh and organic food.
Therefore, it is important for them to fill their storewith organic
products (Gabrieland Rosenthal, 2013). Recently, the number
of elderly people is growing and due to their mobility issues;
Socio-cultural factors
they like to buy groceries online so it will be better for
Associated British Foods Plc. to have a good online strategy to
meet the need of them and earn huge amount of profit. Along
with that, they can develop a good catalog with their diverse
range of products.
Customers give more value to the present technology, so it is
important for Associated British Foods Plc. to give their
attention to the efficient technologies. Due to the
Technological factors increasingnumber of e-shopper, it is important to develop
some effective internet activity so thosetechnologies can
attract customers. They should utilize different technologies
like wireless devices, RFID, self-checkout machines, etc.
There are several legislative factors that directly affects the
operation of Associated British Foods Plc. Like food retailing
Commission has implemented a policy that suggests one code
Legal factors
of practice that bans different activity in food retailing
(Keininghamet al. 2013). Therefore, this law directly harms the
organization.
To be environmentally responsible, Associated British Foods
Environmental factors Plc. Must reduce carbon footprint, ejection of different
greenhouse gasses etc.

LO 4
Internal strength and weaknesses of business and their relationship with
external macro factors:
 P5: Internal andexternal analysis of the specific organization for the
identification of its strength and weaknesses:
According to Mohamedand Lashine (2012), internal and external analysis of
any organization highlights different factors that affect any organization. It is
seen from the external and internal analysis of the organization that one of
core strength of Associated British Foods Plc. is their diverse range of
products. Internal and external analysis can help Associated British Foods
Plc. to identify their strength and weaknesses o they can reduce their
weaknesses by developing different effective strategy.
Strengths:

 They are the leading market player with diversified product range
 They have geographic diversification
 The company has a good corporate culture that increases the loyalty of both
the customers and employees towards their organization
 They have the huge loyal customer base.
Weaknesses:

 They invest huge money on their one business allied bakeries, but due to less
amount of investments in other business they may suffer
 They are suffering from limited liquidity position
 They are facing some problems to implement some common norms and
standards because they do not follow national culture
P6: Interrelation of strength and weaknesses with the external macro
factors:
Strength and weaknesses of the Associated British Foods Plc. have direct
contact with the business and it can directly affect their business. On the other
hand, macro environmental factors affect the performances, decisions
making, strategy and working on the business. Strength and
weaknessesaffectthe nearby environment in which organization operates, but
macro factors affect in the entire geographic region in which a firm operates
(Montazemi, 2010). Therefore, if any firm does not perform well in the home
country and they have different weaknesses then they may face several
difficulties to achieve globally. Therefore, the organization must make their
internationalize strategy by reviewing their strength and weaknesses.
If Associated British Foods Plc. has strength in the national market, then
themanagement of the organization can take the immediate decision
regarding their business-based in that strength. On the other hand, if
Associated British Foods Plc. has several weaknesses, then the
 managementshould be alert to implement different business strategy, and for
this reason, they may face difficulties to perform well (Schiffer. and Weder,
2010).
M4: Application of SWOT/TOWS analysis and justification of it in
decision-making:
SWOT analysis of Associated British Foods Plc.:
Strengths:

1. They are very prevalent brands, Weaknesses:

so they now have high customer
loyalty 1. They have some problem with
the limited liquidity position
2. They have wide assortment of
business operations 2. Heavy investments in the allied
bakeries reduce the investments
3. One of the leading market player
in other business subdivision of
4. They have geographic them.
diversification
3. They have some problem to
5. This business has a strong implement the common ethics as
tradition that helps the well as norms that mainly
organization to silhouette the ascends due to the lack of
commercial culture of the national cultures in different
organization and develops the geographical areas.
loyalty of both the customers and
employees.
Opportunities: Threat:

1. They can capitalize for their 1. Enlarged level of consolidation

future growth 2. Changing demand of the
2. They can invests in the biofuel customers and financial crisis
production because there 3.is Cut in the sugar production of
enough possibility for growth European Union.
3. There is numerous growth in the4. Faces a threat due to the
new markets growing level of rivalry because
4. Entering in the new market can due to the international
help them to enlarge their market developments they are facing
share globally and upsurge the threats from different
steadiness in their sales and multinationalorganizations
revenues 5. They are facing threats regarding
5. They can get a steady galloping prices for foods that
enlargement in their brand
through merger and acquisition diminution their performances in
strategy and products or service the market.
diversification
SWOT analysis is one of the subjective methods that are involved in trying for
attaining an objective. SWOT analysis also involves in the specification of the
objective and identification of the external as well as internal factors that are
unfavorable and favorable for the achievement of the objective of Associated
British Foods Plc..SWOT analysis can be utilized as one of the business tools
that can help Associated British Foods Plc.to take advantages of one's
abilities, talents as well as opportunities (Montazemi, 2010). SWOT analysis
can help Associated British Foods Plc. Organization to summarize and clarify
the key issues and opportunities regarding any business and helps the
organization to make decisions so that they can develop new objective
andstrategies. SWOT analysis helpsany business organization to maximize
strength and minimizetheir weaknesses so they can take opportunities from
the market and decreases threats.
D2: Reflection of macro and micro factors on business objectives and
decision-making:
From the external and internal factors, it is clear to me that Associated British
Foods Plc. has a strong strategic position and has a good set of loyal
customers so they can easily enter the new market. Along with that, they also
have loyal employees and switching rate among employees are very less so
they can expand their business in the different geographical region. I have
seen that they are operating in the market with five businesses that are
Grocery, sugar, ingredients, retail and agriculture. Therefore, it is clear that
they have an effective product differentiation strategy and along with that they
follow a p[rice differentiation strategy so they can easily grab the customers
not only from the UK but also from other organization. However, I have seen
that during their operation in different countries, they have faced a wide range
of competition from other organization and along with that; different political
and legislative factors of thosecountries affect their business in greatest
extent.
I have recognized that Associated British Foods Plc. has a good source of
revenue because they have so many businesses but they are suffering so
much during their expansion due to tax rates, FDI of different countries. I
know that in different countries rate of tax is different, in some countries,
corporate tax positively influence any organization and give them handsome
opportunities to do their business. However, in some countries government
charge huge amount of money as the tax so business in that country may
suffer. During the inflation and economic crisis, different countries responded
differently, some of the countries has recovered them, but some of the
countries did not recover themselves. Therefore, I have gained the knowledge
that monthly disposal income is different in different countries. Therefore,
according to my knowledge Associated British Foods Plc. Must invests in a
different country by reviewing the monthly disposal income of the customers in
that country. I have seen that Associated British Foods Plc. have a business
opportunity in the different new market so they can invest money in new
markets but they must consider the culture and society before investments
because different countries have a different culture and different people like
different types of product and pricing strategy. People from some developed
countries wants a high quality product, people from some countries want to
get the product at low pricing strategy. On the other hand, some people want
to get the superior quality product at low costs. It is seen that Associated
British Foods Plc. do not have effectively represents in the web and they do
not have effective technological advancements. Therefore, according to me, it
is important for them to increase technological advancements in the
organizationto grab the e-shoppers. I have recognized from the analysis that,
Associated British Foods Plc. is an ethical and socially responsible
organization but to grab the attention of the ethical customers they can
increase their sensitiveness regarding the environment. According to me,
every organization must follow all of the law implemented by the government
even it incurs some loss. In this case, Associated British Foods Plc. Must
follow all of the law.

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