Environmental Analysis for Startups

Introduction

Start up business activities need to be planned properly after conducting the environmental analysis. It is mandatory for the entrepreneurs to analyse environment including the political, cultural and other macroeconomic factors that have crucial impacts on the start up business activities (Negara, Damuri and Azali, 2019). The study is a start up guide, where it is possible to demonstrate the purpose of the start up business as well as conduct environmental analysis for the business to be established further in the chosen market. The study also provides a scope to identify the support opportunities and analyse the viability of potential success and challenges of the new firm in the market.

Purpose of the start-up

The entrepreneur aims at developing the ecommerce business to start up the firm and establish it in the central London where the logistics operations are in the UK market to serve the customers across the country. This is a new and innovative business idea, where the organisation would be developed to sell the cosmetics and other health and beauty products in the market. The ecommerce platform is growing at a rapid rate and it is one do the creative business idea where the firm would be able to retain the customers in near future.

The major purpose of the business is to maximise the sales volume and generate high profitability through strengthening their customer’s base. The business mainly focuses on operating in the retail industry of the UK and serves the high quality products including health and beauty products, branded cosmetics and other necessities. The target market of the business would be both male and female members where there would be a huge variety of products which can attract the customers across the UK. The customers can compare the product as per their needs and budget constraint in the ecommerce website and make effective purchase decision easily (Negara, Damuri and Azali, 2019). This is hereby one of the innovative way to grab the ecommerce opportunities in the market and retain the customers for long run. In the recent era of globalisation, the customers prefer online shopping and the entrepreneurs focus on maximising the experience of online shopping creatively to meet the customer’s demand. The purpose of this start up guide is to analyse the environmental factors in the fashion retail industry of the UK and it is possible of the business entrepreneurs to evaluate the market condition and acknowledge the tactics to grab the future market opportunities. Environmental analysis will be conducted in this start up guide, which would be beneficial for the entrepreneurs to establish the business efficiently by developing suitable plan for financing, marketing and operational activities.

Environmental analysis for start-up activities

As per the analysis, the political stability, economic growth and social development further influence the entrepreneurship skill and creativity of the entrepreneurs to design the new ecommerce business by utilising latest technology and IT infrastructure so that the business would be established creatively (Qasim, Mohammed and Liñán, 2018).

Analysis of networking, funding and support opportunities

The market place for the start up business of ecommerce is central London where across the UK there is increasing opportunities to establish the new business. Networking, funding and support opportunities are there for the entrepreneurs to start up the business in the UK and among them government support is one of that, where the government supports the small and medium sized entrepreneurs to start up their business efficiently (Gupta, 2020). There are suitable tactics of establishing the ecommerce business which are identifying the high potential product, identifying the manufacturers, setting good and catchy brand name and present the online store, developing the company website for the ecommerce business, managing the fulfilment and shipping activities, establishing the revenue goals, designing the marketing plan, strengthening supply chain and distribution network and launching the business. Additionally, there is also different options funding and among them venture capital and taking business loan from the banking institutions are appropriate (Alyoubi et al., 2020). Venture capitalists are present in the UK who prefers to invest their capital in the companies for generating high volume of return on investment. On the other hand, the entrepreneurs also take business loans from the banking institutions by applying for loans and managing the legal documentations for taking the loan. On the other hand, the firm incubators in the UK are also active and supportive to provide help to the entrepreneurs to set the new business venture by solving their problems, arranging funds, appropriate capital investment, budget plan, and marketing tactics so that the business can be established through a systematic process. On the other hand, crowd sourcing and alternative financial strategy also provides a scope where the entrepreneurs can raise fund from a vast numbers of people arranging through internet (Antari, and Wulandari, 2019). These are the major support initiatives, which are appropriate for the entrepreneurs to develop new business venture in the central London, where the place is suitable for the new business entrepreneurs with high cooperation from the government, legal documentations of the business and funding activities.

Analysis of viability of creating a start up

The viability of the start up business can be analysed through conducting market research and identifying the success factors and challenges to run the business in the UK market. As per the market analysis, the B2C business in the UK is flourishing over the period of time and the online business and ecommerce activities is the one which contributes high sales volume and profitability leading to high National Income to the country (Chin, 2020). The business activities through the ecommerce is also growing at a rapid rate and thus the new start up business video is great and innovative for the entrepreneurs to retain the long run buyers and make the business efficient to handle the customers and expand it creatively across the UK. As per the figure below, the ecommerce turnover growth in the last year was 14% and it is estimated that it would be growing further in the upcoming years with the increasing activities of online business.

The retail sales growth in terms of amount spent and quality bought is also growing at an increasing rate where the customers prefer to purchase through ecommerce service and they are satisfied with the service of the ecommerce business firms. Hence, the major success factors for the new business venture are such as growing ecommerce activities, strong supply chain and distribution network across the UK retail industry (Chaffey, Hemphill and Edmundson-Bird, 2019). Growing the customers demand for the quality and variety of products in the retail health and beauty market, technological innovation and firm’s creativity which further boost the performance of the new firm where the entrepreneurs would be successful to establish the business efficiently.

On the other hand, the major risk factors in starting up the new business in London are such as lack of funding initiatives taken by the entrepreneurs, poor research and development activities, time constraint and budget constraint as well as proper management which may deteriorate the performance of the entrepreneurs in long run to start up the business in a systematic process (Vasilkova, 2019).

Conclusion

It can be concluded that, the entrepreneurs can utilise the business environment of the UK market and get government support and funding options to set up the ecommerce business and make it successful in near future. Hence, the entrepreneur can develop proper business through utilising the support activities in the market of the UK and mitigating the risk factors in long run which would be beneficial to retain the long run buyers and deliver them high quality products and services.

Reference List

Alyoubi, B.A., Alharbi, I.M., Alyoubi, A.A., Qaffas, A.A. and Almazmomi, N.K., 2020. Management of E-Commerce: Impact on Start-Up Ecosystem.

Antari, N.N.W. and Wulandari, R., 2019. START-UP DIGITAL: TRANSFORMATION OF LOCAL ECONOMIC BEHAVIOR IN GLOBAL WORLD. Journal of Research in Business, Economics, and Education, 1(2).

Gupta, D., 2020. Digital Platforms and E-Commerce in India–Challenges and Opportunities. Available at SSRN 3577285.

Negara, S.D., Damuri, Y.R. and Azali, K., 2019. E-COMMERCE DEVELOPMENT IN INDONESIA Challenges and Prospects. E-Commerce, Competition & ASEAN Economic Integration, p.119.

Qasim, D., Mohammed, A.B. and Liñán, F., 2018. The role of culture and gender in e-commerce entrepreneurship: Three Jordanian Case studies. In Entrepreneurship Ecosystem in the Middle East and North Africa (MENA) (pp. 419-432). Springer, Cham.

Vasilkova, V., 2019. Identifying a digital marketing strategy for a start-up entering the UK entertainment sector. Case study: Evenses.