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Unit 1 - exploring business - Assignment 1 (completed to distinction standard)
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Unit 1 - exploring business - Assignment 1 (completed to distinction standard)
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Jamal AhmedUnit 1 – Features of business
P1: Explaining the features of two contrasting companies.
The 2 companies I will be using to compare are Sainsbury, which is the profitable
organisation, and water aid which is going to be my non-profitable organisation.
Business 1 (profit making)/ Purpose:
The profit-making business I have chosen is Sainsbury. Sainsburys is a UK based supermarket
which sells products which range from food to technologies to their customers. The purpose
of Sainsburys is that they want to help customers to be able to shop comfortably and also
purchase affordable products. When coming to the financial aspects of the supermarket, 1 J
Sainsbury annual revenue for 2020 was $36.862B, a 3.2% decline from 2019. J Sainsbury
annual revenue for 2019 was $38.08B, a 0.87% increase from 2018. J Sainsbury annual
revenue for 2018 was $37.753B’ however, Sainsburys still remain one of the most profitable
supermarkets in the UK. In addition, Sainsburys have around 116,400 employees that are
working in the business helping them achieve their targets.
Ownership:
The ownership type for Sainsbury is public limited company (PLC). One advantage of the
company being a PLC is that people can publicly buy and sell shares from a variety of stock
exchanges as it is publicly available. A disadvantage of having a public limited company is
that if multiple shareholders decide to buy the entire company which can lead to many
changes in the company. Since Sainsbury is a public limited company, they have limited
liability which means shareholders only lose the value of investment. This means that the
shareholders personal wealth is not affected or liable to cover the debt that Sainsburys
faces. Sainsbury being a public limited company has enabled the company to be successful
because they are opened up to an opportunity where they will be able to grow and expand
their business. Finally, Sainsburys being a public limited company will help this business be
successful because they are able to give the company a respected amount of attention.
Size and scope:
Sainsburys is one of the 2UK’s largest food retailers with over 600 supermarkets and 800
convenience stores. As of 2019 the amount of sales/ revenue Sainsbury has made was
£29.01billion which placed them 2nd in the UK marketing industry below Tesco who has
made £63.91 billion as of last year. Additionally, Sainsburys also has a large number of
employees working for the company which consists of 111,900 however; the numbers of
employees reduced from last year due to the pandemic.
1
https://www.macrotrends.net/stocks/charts/JSAIY/j-sainsbury/revenue#:~:text= J%20Sainsbury%20annual
%20revenue%20for%202020%20was%20%2436.862B%2C ,increase%20from%202017.%20Compare%20JSAIY
%20With%20Other%20Stocks
2
https://help.sainsburys.co.uk/help/terms-and-conditions/how-many-stores
,Jamal Ahmed
Unit 1 – Features of business
In addition, Sainsburys has also been owned by Walmart along with ASDA which shows that
Sainsburys has gained recognition from the bigger American market industry they have
merged together because it will benefit them from being overtaken from other
supermarkets in the UK. Moreover, this has helped them come up with better ideas on how
they can improve on sales, meet the annual goals and also be able to make a decent amount
of profit. Sainsburys has been recognised 3to provide great food at a fair price. We believe in
being fair to our suppliers and our environment, and don't cut corners for short term gain.
Evidently, this summarises that Sainsburys is a very unbiased organisation therefore; they
will attract more customers
Sectors:
Sainsburys in part of the tertiary sector, which means to provide, for consumers and
businesses, the final product that has been manufactured. Sainsbury produce the already
made/ raw products to their customers. For example, Sainsbury products ranges from food
products, clothing and technology enabling the customers to decide on what they want to
purchase. Additionally, Sainsburys fall under the public sector as they sell these products to
the public so they can make more profit which they can use to invest in different products
which will help them develop the business.
Aims and objectives:
These SMART goals apply to the purpose and size of the business because it will help them
develop and expand. For example, on the Sainsburys about us page it says 4Our purpose is
to help our customers live well for less. In other words, it also can be seen as a target or an
objective they want to achieve. Since Sainsburys is a very large company the store managers
for all the branches in different locations may have different aims and objective this is
because it helps the business as a whole to meet the criteria and be able to finish their work
on time. Since Sainsburys is a very popular supermarket they will have many competitors in
the market. However, the competitors will have different aims and objectives therefore
Sainsburys will need to find different types of approach for them to be leading in the
market. Having aims and objectives will help the business become successful because it will
bring positive changes which will gain more public attention. For example, by having an aim
to increase profit Sainsburys will have to list down objectives which will help them achieve
that goal. For them to achieve the goal they will need to decrease the price for everyday
items so customers stay loyal to the business however they can increase the price for
products which aren’t needed every day so that customers can make more purchases.
Reasons for business success:
Throughout the years Sainsburys have been using strategic planning for them to be able to
out-perform other supermarkets who are competing for the 1 st position on the market
industry. An example of how they were able to become such a successful company is that
3
https://www.about.sainsburys.co.uk/about-us/our-business-strategy#:~:text=Our%20core%20purpose%20is
%20to,corners%20for%20short%20term%20gain.
4
https://www.about.sainsburys.co.uk/about-us/our-purpose
,Jamal Ahmed
Unit 1 – Features of business
they 5focused on offering customers quality products at affordable prices. This enabled
Sainsburys to gain a lot of attention by customers which helped Sainsburys sell a lot of their
products therefore; they are able to make billions in revenue every year. Additionally,
Sainsburys are expanding their business which also means they will need more staffs to fill
up vacancies this is one aspect Sainsburys are great at doing since they currently have over
116,400 staff members working for them. Moreover, the employees are an important asset
to Sainsburys because not only do they provide great customer service, they are also able to
help the business develop.
Sainsburys are always producing/ expanding the number of products they sell in their
market industry this is because It will encourage customers to buy more products from
them which will financially benefit the business. In addition, the aims and objective
encourage the company to become more successful because it emboldens them thus the
employees can boost their motivation and work extra hard. This allowed the business to
maintain the businesses success rate and develop their brand to adapt further into the
marketing industry. Furthermore, on April 30, 2018 Sainsburys announced that they will be
merging with the American supermarket Walmart, this has helped Sainsburys with their
success because they believe that 6the Combination will create one of the UK’s leading
grocery, general merchandise and clothing retail groups. Bringing together two distinctive
customer propositions will create a more competitive, adaptable and resilient business -
better placed to invest in price, quality, range and more flexible ways for customers to shop.
This meets Sainsburys purpose because they want to help customers shop without having to
worry about spending a lot of money or time.
Business 2 (non-profitable)/ purpose:
Water aid charity is a registered charity which means that they are legally allowed to do
charitable things because of this. WaterAid which raises money to help unfortunate people
from countries that has no access to clean water, decent toilets and are not able to take
care of their hygiene. Water aid uses their money to build wells and toilets closer to
people’s homes this is because it prevents people from travelling long distances just to get
water which could be contaminated. Additionally, the water aid charity workers also help
implement a cleaner toilet system so that the people can take care of their hygiene and
have a cleaner lifestyle.in 2014 – 15 water aid were able to make £90 million just from
donations however, in 2018 – 19 they were able to raise £113 million which is a huge
improvement from 2014 as it impacted the charity a lot more since they were able to reach
closer to their goal. Water aid has many employees which consists of 1000 however; they
also have many volunteers helping out which increases/ decreases depending on the type of
work they do. The purpose of water aid is ensuring that even the poorest living amongst the
people have access to clean water, toilets and great personal hygiene as it is basic human
rights to have access to those. On the other hand, Water-aid are raising money even today
5
https://www.about.sainsburys.co.uk/about-us/our-business-strategy
6
https://corporate.walmart.com/newsroom/2018/04/30/walmart-and-sainsburys-announce-combination-of-
sainsburys-and-asda-walmarts-wholly-owned-uk-business
, Jamal Ahmed
Unit 1 – Features of business
to make sure they reach their goal which is to ensure that all the unfortunate people have
access to these basic needs.
Ownership
Water aid is a charity which means that they are organised by people who are raising money
for good causes and not for selfish reasons. Water aid ensures that their funding goes
towards the government and other important assets that will help them for example, the
donations that people have contributed to water aids will go towards sanitations to help
with the hygiene problem, develop ways for the less fortunate people to have access to
clean water without having to travel a far distance and also toilets to ensure everyone has a
clean lifestyle. In addition, water aid is a charity therefore, they will have government
protection if they do face a financial problem (limited liability).
Sectors
Water aid is a tertiary sector as they provide for the less fortunate people with essentials
every human has access to. Water aid also works with the7governments and local
authorities to change their policies and improve coverage and rights to clean water,
sanitation and hygiene services. Water aid does this so they can encourage the government
to also make changes and work along with water aid to help achieve people’s needs and
wishes.
Size and scope
Water aid is a large charity organisation consisting of 1000 employees and “in 2004, when
there were only 100 volunteers and just one water stand. Since then, I’ve watched the team
swell to over 500 people, with new offerings like the Loo Crew, ShePees and Recyclers”. 8
Majority of the volunteering is done so that water aid is able to achieve their goal an
example of volunteering volunteers might provide is donating fresh clean water to the
people that need it the most. People volunteer because they want other unfortunate people
to have basic human resources as they believe it is wrong to be belittled and not having
access to these basic human resources/ needs. Water aid a global charity however, most of
their volunteering schemes are done in the UK but they operate in the UK, US, Australia,
Canada, Japan and India. “As of 2014/15 Water aid has made a total revenue of £90 million
however, this kept increasing throughout the years and as of 2018/ 19 they have had an
increase of £23million which totals up to £113million. 9
Reasons for success
Water aid is a successful charity because of many reasons. Firstly, the most common
reasoning is that donations have had a massive impact on their charity which meant they
were able to achieve their goals. In addition, they have moral beliefs which is that everyone
7
https://www.wateraid.org/uk/frequently-asked-questions
8
https://www.wateraid.org/uk/blog/why-volunteer-for-charity-wateraid-volunteers-tell-all
9
https://www.wateraid.org/global-annual-report-2018-19#:~:text=In%202018%2D19%2C%20our%20global
%20income%20was%20%C2%A3113.3%20million.&text=From%202014%E2%80%9315%20to%202018,from
%20institutions%20and%20other%20sources.
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