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Business and Markets

Extracts from this document...

Introduction

Introduction This assignment requires me to select a business and to investigate the business and the market in which it operates. I have decided to use Sainsbury's for this assignment and I will be investigating the business and its market in which it operates. I must also write a report addressing the following tasks Definition of Markets: Market is any place or process that brings together buyers and sellers with a view to agreeing a price. Task 1 Identify and describe the market in which your chosen business operates, highlighting its responsiveness to customer demand Sainsbury plc is the parent company of Sainsbury's Supermarkets Ltd, commonly known as Sainsbury's, a chain of supermarkets in the United Kingdom. The group also has interests in property and banking. The group has an estate worth about �8.6 billion (March 2007) For much of the 20th century Sainsbury's was the market leader in the UK supermarket sector, but in 1995 it lost its place as the UK's largest grocer to Tesco and in 2003 was pushed into third by ASDA. The company's fortunes have improved since the launch of a recovery programme by CEO Justin King in 2004, with it reporting its 12th consecutive quarter of sales growth in January 2008.[2] Despite predictions that Sainsbury's would regain second position, Taylor Nelson Sofres data released in January 2008 shows Asda's share as 16.7% compared to Sainsbury's at 16.4%.[3] Sainsbury's has 127, 235 shareholders and has issue shares of 1,734,239,672 in 2007 compares to 1,710,516,638 in 2006. Sainsbury's is the number three UK supermarkets with a market share of 14.9%. Their issued share capital as at 11 July was 1,741,318,851 ordinary shares at 284/7 pence each. Sainsbury's is a tertiary sector of economy, and that means they manufacturing their goods before selling it and it is also a public sector of economy, which means that it has shares sold and bought on the stock exchange. ...read more.

Middle

Organisations should be aware of the importance of customers and release that marketing activities begin and end with the customer. Many businesses since the beginning have always competed against each other. On the basis of competition, different types of market exist because of their products and services they offer. The market competes, when a firms compete against each others, by looking at the price of their rivals for example if ASDA sells bread for 45p, and Sainsbury's sells bread for 35p. This can actually make ASDA and Sainsbury's compete against each other according to the prices of a bread, not only that. An oligopoly's can also act as a rational player when setting prices by using game theory to predict their rivals' behaviour. In short, in an oligopolistic market, firms set prices according to the reactions and behaviour of the rival firms. The firms are interdependent, i.e. rely on each other when making such rational moves. In perfect competition, there are many firms and they compete on prices. They use mark up pricing, which involves adding a profit mark-up. The size of this mark-up depends on the firm's objectives, i.e. profit maximisation. Prices are closely related to costs of production, i.e. if the costs of production are high, a firm will increase the price in order to maximize the profit it earns. Costs can however, only be crudely estimated therefore the firm has to rely on the uncertainty of demand or the behaviour of its rival firms to set the mark up price. Sainsbury's also need to maintain their market share, because if they don't do this, this will affect the business by losing their shares in term of a not accuracy market share. Sainsbury's compete for customers by trying to offer better value than their competitors do so that the customer will get use to Sainsbury's products. In this situation, products will keep improving or even get cheaper so that its helps the business to attract more customer into their business. ...read more.

Conclusion

The banks are increasing the security of the debit/credit cards of the user. To purchase an item online the user need to key in the password and the date of birth. Achieving a responsive integrated supply chain A supply chain contains every single business that is involved in the eventual supply of a product or service. But there are problems associated with the supply chain. If the chain is long the price to the customer may be high and the chain is usually slow to respond to a rapid change. To combat these problems businesses tried to change the supply chain to shorten it, this is done by cutting out or by passing as many intermediaries, and to integrate it, to speed the things by changing the information in one stage to another. Other benefit is the opportunity for buying the products online. Businesses can improve the product delivery and reduce the time between the order and supply. Customers can check stocks online. If an item is currently out of stock many businesses put a note on the site and email the customer when stocks are replenished. Online order tracking is another benefit. It enables the customers to check every stage of their order from the supplier's website. The system sends automatically email to customer informing about tracking order. In other systems customers can check at any time the progress of the order Businesses can reduce overheads and labour costs. A business that has a short and an integrated supply chain has more possibilities to process the orders more cheaply. This is because there is likely to be fewer staff required to process paperwork relating to customer orders, fewer shops required if the business deals directly to the customer, fewer intermediaries required and fewer staff needed to deal with the customer. ?? ?? ?? ?? Laura Awofisayo BTEC National Diploma in business 21044229-1 Unit 29- Business and Markets Geoffrey sell 1 ...read more.

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