Name: Aadesh Sharma

Sec: A BBA
College: ISMT
Examination of Business and Business Environment

Executive Summary
This case study will consider all the major purposes of establishing a private business or a small
scale business organization with its legal structures and relate this to the requirement of case
study. Also, this case study will cover the relationship between different organizational functions
leading towards achievement of organizational goal. This case study will also consider some of
the major macro environment factors that has positive and negative impacts on private business
considering the pandemic situation currently being faced by the world and lastly this study is
going to consider some strengths and weaknesses of private business organization.

Introduction
This case study is related to Kajiman Gurung who has recently returned to Nepal after working
in different companies in Dubai for nearly twenty years. As working for different companies
there, he is able to save some money from which he wants to open his own small scale business.
Now the real deal is he has very little knowledge about operating a business and has no idea
about how it functions in existing business environment. Now he asked us to help him to make
him understand how the business operates and its functioning and now it’s our responsibility to
help him.

Discussion
Business organizations differ in terms of types, sizes and scopes which has distinctive set of legal
structure along with the objectives. Various organizations formed through different legal
structure has differing goals and objectives in the industry which have different consequences in
the business operations and performances (Begg, 2013). Public firm or organizations are owned
and controlled by the government which has general purpose of supplying desired goods and
services to the general people.The management and control of the firm is done by the
government or governmental agencies which does not have the purpose of profit maximization
but the greater benefit and value creation for the community’s people. Public limited company
structure is commonly followed for this type of organizations where required finances are
delivered by the governments along with the owners or stockholders (Daniels et al, 2012).
Besides, public organizations can also be formed through governmental act or regulations. For
example, BBC is the public organization which is controlled by the British government.

Private organization has the general purpose of profit and wealth maximization where the firms
are controlled by the stockholders. A set of stockholders delivers finances to the firms who are
the owners and take fundamental decisions of the company. The owners gets the dividend along
with other benefits periodically. The company structure is followed for this type of organizations
where company act 2006 is strictly followed (Palmer and Hartley, 2011). For example, Virgin is
the private organization which has the purpose of profit maximization and controlled by the
stockholders. Voluntary organizations has the common purpose of supporting and helping the
people of the community for the higher standard of living. The support may include assistance to
the animal, endangered groups of the community, children etc. National trust is the example of
voluntary organization which is formed by the charity structure where companies tries to break
even instead of profit maximization.

Organizations may differ based on various sizes and scopes which is very significant in the
business perspectives. There are more or less four basic types of organizations if one considers
size aspect such as micro business, SME business, transnational business and global business
which have different scopes in their own set of industry environment (Mullins, 2014).Micro
businesses are the type of business unit which is very small in sizes. Those type of businesses has
the lowest number of employees and turnover compared to the rest. For example, sole trader is
the type of micro business because it has less than 10 staffs with smaller scope of revenues and
customers base.

Small and Medium Enterprises are the businesses which are moderate in sizes which has medium
percentage of revenues and customers. The number of employees varies from 200 to 300 here
who focus moderate level of customers for the value creation and profit maximization.
Transnational business is the entity which has international operations in more than one country
(Brown, 2013). This type of firm has higher level of employees for the enhanced international
operation. AstraZeneca is the example of transnational firm which realizes higher level of
revenues from various markets in world. Global business has extensive operations in almost all
countries of the world which possesses the highest level of employees and revenues along with
the profitability and customer base.

The size, scope and structures of various organizations in the market has clear implications over
the business purposes and products and services. The relationships among them is clear which
helps the managers to take effective decisions regarding this issue which can enhance the
business efficiencies (Burnes, 2014).A public limited firm has large size with enhanced scope in
the market. It has large customer base to serve that have clear implications over the products and
services offered along with the business objectives. A large firm like Virgin which is a private
sector business has really huge and dynamic business objectives which drives the firm forward in
the future. Besides, the large size and scope of the firm can enable the business to develop and
market large number of products and services. Besides, organizations with larger sizes and scope
enjoys economies of scale, learning benefit and other competitive edges through which cost can
be reduced, benefits can be enhanced and values can be created for the customers (Fritz, 2013).
On the other side, a sole trader business for example, has a smaller size and scope which deters it
to offer extensive and improved products and services.Besides, their objectives are created based
on the short term period which serves the firm poorly in terms of long term period.

Now basically private business is that type of businesses which is privately owned and has no
external interference like government, etc. This type of business is generally formed by a small
number of shareholders who came together for social cause or profit motive. The main reason
why private companies are called private is because their shares do not trade in public exchanges
as a result they are not issued to Initial Public Offering (IPO). Most of the companies like to be
private to prevent them from the cost of IPO. Hence, private companies do not meet the
Securities and Exchange Commission’s strict filing requirements that a public company has to
meet.

Some of the basic types of private companies are listed below:

 Sole proprietorships
 Partnerships
 Limited companies

Sole Proprietorships: A sole proprietorship is a business owned and managed by one person,
and the owner bears unlimited personal liability on the debts incurred by the business. All of its
assets, liabilities, and the obligations are the responsibility of the business owner. If the business
goes into debt, the owner may be required to sell personal assets to settle the debt. The owner can
decide to either run the business on his own or employ other people to help run the business.
They do not have a separate legal personality and the liability of the proprietor is unlimited.
These type of firms are mostly used by individuals undertaking trading activities such as
retailers, shops, importers of particular goods and professional service providers like lawyers and
accountants. In Nepal, Individuals can register sole proprietorship firms under the Private Firm
Registration Act 1957, which provides the firm with a trading name. Its advantages and
disadvantages are:

Advantages:

 Easy to establish, control and dissolve

 Prompt and flexible decision making
 Higher secrecy

Disadvantages:

 Periodic renewal
 No separate legal entity

The sole proprietorship, according to section 3 of the private firm registration act 2014, requires
the proprietor to register the business either in Department of Cottage and Rural Industry in case
of cottage and rural industry or Department of Commerce in case of commerce related firm or in
Department of Industry for any kind of industry.

The person who wants to establish a proprietorship firm to set up a business, it must be registered
by submitting a application to the concerned department in a manner as prescribed by department
paying prescribed fees. The application should contain the following information:

1. Name of the firm to be registered

2. Address of the firm
3. Owner’s complete information
4. Objectives, functions, features and also the goods or commodities transacted by the firm
5. Citizenship certificate
6. Other essential documents

Registration Fee
100000 or less-600

Above 100000 below 300000-2000

Above 300000 below 500000-4000

Above 500000 below 1000000-7500

Above 1000000 below 500000-10000

Above 5000000-15000

Renewal of the firm

A sole proprietor needs to be renewed with the duration of 3 years.

100000 or less- 300

More than 100000 and less than 300000- 500

Above 300000 less than 500000- 800

Above 500000 below 1000000- 1200

Above 1000000 below 5000000- 1700

Above 5000000- 2300

Partnerships: A partnership firm is similar to sole proprietorship but it is managed by two or

more than two people who agree to work together with the motive of making profit. The partners
bear unlimited personal liabilities on any debt incurred by the business. Some of the major type
of partnerships is general partnerships, limited partners and limited liability partners. These firms
can be registered under the Partnership Act 1963. There is no restriction on the maximum
number of partners in a partnership firm.

Advantages:

 Larger resources compared to sole proprietorship

 Flexibility in operations and decision making

Disadvantages:

 Periodic Renewal
 No separate legal entity

Registration
A firm needs to be registered in the record of the concerned department within six months from
the date when the partners enter into agreement of partnership.

In order to register a firm, an application in the prescribed legal format shall be submitted before
the concerned Department, stating the details as follows, along with the official fees and a copy
of the agreement concluded between partners, if any,
(a) Full Name of the firm
(b) The Principal place of business of the firm,
(c) The objectives of the firm including the short description of the nature of the goods or
services, as the case may be, which the firm intends to run the business,
(d) The full name, surname and permanent address of the partners,
(e) The matter of restriction imposed on the power of a partner, if any,
(f) The types of partnership and the capital subscribed by each partner,
(g) The name of a partner or partners, who represent the firm,
(h) The mode to share the profit and loss between /among partners,
(i) The mode to calculate the profit of a firm.

Registration Fee
100000 or below- Rs.600

Above 100000 below 300000- 2000

Above 300000 below 500000- 4000

Above 500000 below 1000000- 7500

Above 1000000 below 5000000- 10000

Above 5000000- 15000

Renewal Fee
A partnership firm should be renewed each year, within a period of 35 days of expiry of fiscal
year.

100000 or below- 100

Above 100000 below 300000- 125

Above 300000 below 500000-150

Above 500000 below 1000000-200

Above 1000000 below 5000000-250

Above 5000000-300

Limited Companies: These companies often have multiple owners who share ownership and
liability. It is a general form of incorporation that limits the amount of liability undertaken by the
company’s shareholders. Its legal structures ensure that the liability of company members is
limited to their stake in the company by way of investments or commitments. There are several
variations of limited companies existing around the world and are followed by the standard
abbreviations including Ltd., PLC, LLC, AG, etc. These are incorporated under the Companies
Act 2006. The Companies Act provides the incorporation of:

 Private Limited Companies

 Public Limited Companies
 Non- profit companies

Private Limited Companies: These companies require only one shareholder or promoter for
establishment in Nepal. There are not any minimum capital requirements for establishment.

Public Limited Companies: It requires at least seven shareholders. A minimum paid up capital of
10 million Nepalese rupees is required to register as a public limited companies.

Non-profit organizations: It requires at least five members for establishment. As it does not have
any shareholders, it does not require any form of minimum capital.
Documents required for registration
 Memorandum of association of proposed company
 Articles of association of proposed company
 Copy of the agreement such as Joint Venture Agreement or Memorandum of
Understanding (if any)
 Approval license if a company is intending to operate a business regulated under
Industrial Business Act
 Incorporation decision of its board of directors and other major documents if the
promoter is a company
 Approval under the Foreign Investment and Technology Transfer Act if the promoter is a
foreign national or foreign company
 In addition Powers of Attorney are required if promoters want to send a representative
rather than appear in the Office of the Companies Registrar themselves.

Government Fees
The government fees are based on Authorized Capital and are charged are as follows:
• Up to NPR 100,000 (authorized capital): NRS 1,000.
• NRS 100,001 to NRS 500,000: NRS 4,500.
• NRS 500,001 to NRS 2,500,000: NRS 9,500.
• NRS 2,500,001 to NRS 10,000,000: NRS 16,000.
• NRS 10,000,001 to NRS 20,000,000: NRS 19,000.
• NRS 20,000,001 to NRS 30,000,000: NRS 22,000.
• NRS 30,000,001 to NRS 40,000,000: NRS 25,000.
• NRS 40,000,001 to NRS 50,000,000: NRS 28,000.
• NRS 50,000,001 to NRS 60,000,000: NRS 31,000.
• NRS 60,000,001 to NRS 70,000,000: NRS 34,000.
• NRS 70,000,001 to NRS 80,000,000: NRS 37,000.
• NRS 80,000,001 to NRS 90,000,000: NRS 40,000.
• NRS 90,000,001 to NRS 100,000,000: NRS 43,000.
• More than NRS 100,000,000: NRS 43,000 plus NRS 30 for each additional NRS 100,000.

Legal Fee
Other costs for registration, the main one being legal fees, vary with the type of businesses,
complexity of the relationship between the shareholders, and on many other factors. For a small
company for Nepali nationals with no complications and where no additional services such as
drafting extra contracts (labor contracts, lease contracts) and tax registration and planning are
being offered, it should not cost more than NRS 20,000-30,000 per Company.
When complex issues are involved, and the needs of multiple investors have to be balanced,
legal fees charged by specialized corporate lawyers can be more expensive, but mistakes in the
initial stages may cost you more in the future. Therefore, it is advised not to compromise on the
quality of legal advice if you are a serious investor.

Purposes of establishing private companies

Profit Maximization: If there is one area where public and private companies overlap, it is in
their desire to maximize profits for their shareholders. In a private company, these profits are
restricted to the company's core set of owners, which may be just one person or a small group
of interested stakeholders who have invested in the company. Often these owners also have a
direct impact on the day-to-day management of the company, so the desire to increase profits is
even more of a concern than in many public companies, where the goals of the management
and stockholders may differ.

Transparency in Reporting: Another objective for private companies is transparency in

financial reporting and annual reports, but the transparency is typically restricted to the key
stakeholders in the organization and may not extend to the public at large. Whereas public
companies have a responsibility to reveal financial data and performance metrics to the stock
exchange and to their many shareholders, private companies are not required by law to publish
their financial statements. This means that transparency in reporting is limited to those in "the
know" who have a direct say over how the organization does business. While transparency is
important in making accurate business decisions in private companies, this transparency should
not be confused with an open-door policy common in publicly traded companies.

Choosing the Correct Organizational Structure: Private companies are also keenly interested in
securing the right kind of organizational structure for their particular business interests. Private
companies can be organized as corporations, limited liability companies, partnerships or sole
proprietorships. Each of these organizational structures has different benefits for the company
and for the individual stakeholders. Choosing the correct organizational structure is therefore a
key objective of private companies because of their interest in limiting individual liability and
maximizing profits for the core group of owners.

Restricting Access: An objective of private companies is restricting access to the company's

policies, competitive strategies and marketing plans. As with the limits on financial
transparency, restricting access to the business's policies and procedures helps to ensure that
knowledge of the company's private data is kept out of the public eye. Private companies
consider this an advantage to edging out competition and keeping trade secrets safe. In fact,
many private companies resist going public for this very reason -- they do not want to be
forced into revealing the inner workings of the company's strategies for fear that a competitor
will come along and seize on these plans.

Hence these were some of the purposes and legal structures of private companies.

Business structures are the ways through which different types of organizations are formed.
Various functions are conducted in every types of firm with different structures. But the nature of
those structures and their interrelations are different from one another which makes their
business and operational implications significant. Micro firm has most simple business structure
because of the simple nature of the business scope, sizes, staffs and objectives. Those firms has
various business functions but are performed easily and collectively (Pugh and Hickson, 2011).
For example, a small coffee shop produce coffee and sell it right way to the customers where
distribution, customer service are ensured. So, the interrelations among the functions of the
micro business is more direct and simple in nature which simplifies the business model and
overall operations and performance. Besides, the complexities of the SME business structure are
moderate where it is formed as company or partnership business. The functions of those firms
are little bit separate and distinctive where organizational efficiency can be enhanced through
ensuring more interrelations among the functions.

In the transnational business, the business structure is complex enough which maintains various
separate functions of the firm. For example, AstraZeneca directly participate the decision making
related to the production, marketing and R&D in various countries directly where the
interrelations among the various functions must be ensured (Palmer and Hartley, 2011). Global
business has the most complex business structure where decisions are taken by the regional
operations. The business functions must be standardised and interrelated for the greater
performance. Virgin for example, takes decisions globally to form better interrelations among the
various business functions such as marketing, production, finance, services etc.

There is a close interrelation among the organizational functions, objectives and structure. The
organizational functions are based and operated based on the organizational objectives and
structures. On the other hand, organizational structures influence the overall nature and span of
the organizational functions (Slack et al, 2010). Organizational functions do not work alone
rather they work collectively and generate superior values and perform better within the firm. A
well-organized organizational functions works better hence better operational efficiency,
revenues and performances which benefits the stakeholders.

For example, Virgin is the firm which has rich organizational structure that allows the firm to
maintain an effective set of organizational functions that can generate the higher values for the
target customers (Starr, 2013). Moreover, this firm follows its vast objectives and transform it
into the business through its effective functions. All of the functions of the firm is dependent on
the other such as production is dependent on the demand perceived by the sales functions. Sales
function takes decisions based on R&D and finance and distribution functions.

Interrelations among the organizational function is obvious within the various types of firms
which make it possible to deliver the products and services to the customers. This aspect clarifies
that it is not enough to have all the functions within the firm but proper interrelation among them
along with better control and leadership in those functions can serve a large portion of the
customers and avail competitive edges (Stevenson, 2011). There are various forms of advantages
of these interrelations among the organizational functions along with various disadvantages.
Better interrelation among the business functions can satisfy business objectives more effectively
than any other business strategy. Besides, organizational functions’ cumulative efforts can create
enhanced values along with synergy effects that create extra values and competitive ground for
the firm.

Effective interrelation among the functions can communicate necessary data which can be used
for the decision making purposes. Besides, corporate culture can be enhanced through ensuring
better interrelation among the business function. Virgin’s better corporate culture comes from
one of the sources which is better interrelation of the business functions. In some case, that
interrelation creates some disadvantages for the firm (Summers, 2010). The firm will be less
effective if there is a close interrelation among the sales and production functions where
production function is poor because there is a possibility to reduce the effectiveness of sales
function. The advantages of this interrelation can positively affect the business structure and
enhance its effectiveness and vice versa.
Macro environment of the business consists of various environmental factors which puts positive
or negative impacts on the business operations. Let’s take an example of Unilever. Unilever is
affected by the factors of the macro environment (Waters, 2012). Emergence of the global
growth opportunities powered by the higher market creation and demand can enhance the
business operation. Besides, enhancement of the social technology within the business operation
results higher efficiency in business functions and overall performances. The digital revolution
of the consumption along with the higher production is creating better opportunities for the firm.
Development of the information and communication technology make it possible for the firm to
develop higher utility and quality products and services which make the business operation
effective (Drucker and Maciariello, 2009). Global shift of the economic and social power is
actually creating more demand for the firm’s products in underdeveloped part of the world which
benefits the business operation. Pressure from the ethical and sustainable growth along with the
cyberspace security is creating risks and uncertainties for the business operations of Unilever.

A detailed PESTEL analysis can be conducted in the following for Unilever which will assess
the external environmental aspects that have impacts over the firm’s operation.

a) Political factors: Political stability along with the favorable rules and regulations related
to the international trade and taxations are very positive for Unilever which benefits the
firm in its operation (Drucker, 2012).
b) Economic factors: Unilever is benefitted by the lower interest rate which promote
investment. Besides, low inflation rate, high GDP, savings, higher economic stability
ensures steady demands for the products of the firm.
c) Social factors: The community where the firm operates generally has higher income
followed by the higher employment rate, literacy arte and standard of living. Besides,
positive religious and ethnic scenario benefits the operations (Ansoff, 2010).
d) Technical factors: Overall operations are promoted by the advanced communications
and information system along with the effective innovation and development. Company
product cost can be substantially minimized with the assistance of technical factors.
e) Environmental factors: Physical environmental conditions such as precipitation,
temperature, natural disaster etc are in favor of the firm’s operation. Those factors
actually benefit the firm’s operation (Dess and Miller, 2010).
 f) Legal factors: Environmental legislation, employment regulations along with the issues
of contractual liabilities can create several challenges within the operations of Unilever.

Impact of Pandemic on Private Business operations

Businesses must navigate the financial and operational challenges of corona virus while rapidly
addressing the needs of their people, customers and suppliers.

Impact on Strategy

Today’s CEOs are faced with overwhelming competing challenges and uncharted waters as they
continue to navigate the impacts of the COVID-19 pandemic. Out of necessity, CEOs have
prioritized the now-supporting their people, customers and suppliers, addressing supply chain
disruption, stabilizing revenues, aligning their businesses with evolving demand and identifying
new growth pathways. Leaders are rapidly turning their attention to the Next, a period of
unpredictable and possibly muted economic recovery with new competitive threats and
opportunities, and quite possibly a decade of the Never Normal, a new era defined by fast
changing shifts in cultural norms, societal values and behaviors, such as increased demand for
responsible business practices and renewed brand purpose. Against this backdrop, leaders face
the urgency and complexity of reopening their businesses. To outmaneuver uncertainty,
reopening also requires a program of reinvention. This presents an opportunity and a need for
many companies to build the competences they wish they’d invested in before to be more digital,
data-driven, and in the cloud to have more variable cost structures, agile operations and
automation; to create stronger capabilities in e-commerce and security.

Impact on Customers

The corona virus outbreak has forced companies to reevaluate how contact centers are leveraged,
how employees deliver relevant customer experiences, where they work, and how digital
channels can be used to support business continuity through the crisis and beyond. The global
COVID-19 pandemic has forever changed our experiences―as customers, employees, citizens,
humans― and our attitudes and behaviors are changing as a result. The crisis is fundamentally
changing how and what consumers buy and is accelerating immense structural changes in the
consumer goods industry, for example. Once the immediate threat of the virus has passed,
companies will need to consider the impact of these changes on the way we design,
communicate, build and run the experiences that people need and want. With these emerging
new behaviors, organizations have an opportunity to accelerate the pivot to digital commerce, by
expanding existing offerings and creating new lines of service, like the retailers rallying to
provide “contactless” delivery and curb-side pick-up services for consumers. This acceleration
will force organizations to reimaging their digital strategies to capture new marketplace
opportunities and digital customer segments.

Impact on Workforce

Organizations globally are experiencing unprecedented workforce disruption. Virtually all

companies are still determining how we will work in the short- and long-term, as workforces and
communities try to function and perform, while struggling to cope with what is happening in
their daily lives. CHROs across industries are rising to the challenge, helping people and
organizations navigate massive workforce shifts, such as the urgent need to shift to a remote
workforce to protect and empower employees, serve customers and to establish business
continuity. For example, the now critical need for virtual care messaging and visits in healthcare.
CHROs’ expertise in developing agile workforce strategies is critical to keeping the global
economy viable and helping people and their families survive financially now and in the future.
Opportunities are emerging as companies and industries work together to keep people working.
For example, Accenture has partnered with CHROs of leading companies to create People +
Work Connect, an analytics-based platform that facilitates continued employment. People,
organizations and communities need fit-for-purpose plans today that can evolve as the global
health and economic environment changes. Businesses, governments, citizens, and non-profits
all play critical roles in establishing a human-centered, systems-minded approach that promotes
shared workforce resilience.
Impact on Operations

With the COVID-19 crisis, fundamental changes in consumer behavior, supply chains, and
routes to market are knocking companies off balance. Responding to the pandemic has
underscored the need for leaders to accelerate the adoption of agile ways of working and value
chain transformation to help outmaneuver uncertainty. Becoming an Intelligent Enterprise means
shifting from top-down decision-making, empowering teams guided by purpose, driven by data,
powered by technology and enabled by cloud for faster speed to market. It calls for razing rigid
structures and creating a porous organization with modules that plug and play. The Intelligent
Enterprise is capable of dynamic self-management and continual adaptation. It is built for agility,
resiliency and growth. Adopting a distributed global services model can also help large
organizations across industries—from oil and gas to communications and media—to diffuse
enterprise risk. Automating routine tasks with human+machine models, where everyone is a
knowledge worker, can also help to serve businesses now, and to position them for growth post-
COVID-19. And now, more than ever, the supply chain is critical.
Companies need to develop a rapid response to address current disruptions and to repurpose and
reshape supply chains for the future by increasing both resilience and responsibility.

Impact on Finance

In the face of the COVID-19 crisis, leaders have had to act quickly to optimize their company’s
resilience—rebalancing for risk and liquidity, while assessing opportunities for growth coming
out of the downturn. Current and future viability depend on swift C-suite action, including near-
term actions for stability and strategic moves that will create new futures for companies and
industries. Immediate action is needed to address short-term liquidity challenges, but also to
solve for costs and profitability and generate funding to invest in new opportunities, including
M&A. Many CEOs are faced with plummeting sales and revenue and increased costs.
Interventions to adapt may require investments in key technologies, processes and people. For
some, liquidity has become a matter of survival. Actions taken now can have an immediate
impact on the survival of the company, how quickly it rebounds from the global downturn, and
its financial health and sustainability going forward.
Impact on Technology

Even before COVID-19, many organizations faced considerable IT challenges. Now, COVID-19
is pushing companies to rapidly operate in new ways and IT is being tested as never before. As
businesses juggle a range of new systems priorities and challenges― business continuity risks,
sudden changes in volume, real-time decision-making, workforce productivity, security
risks―leaders must act quickly to address immediate systems resilience issues and lay a
foundation for the future. Leaders in the chemicals industry, for example, are recognizing
resilience as a key success factor. Once we reach the other side of this pandemic, it will be
important to establish long-term strategies for greater resilience and to apply lessons learned
from the experience to create a systems and talent roadmap that better prepares your company
for future disruptions.

Impact on Industry

All industries have been impacted by the COVID-19 crisis, with varying degrees of severity.
Some have stronger defenses, while others will struggle to return to a constantly shifting
“normal.” Consumer demand patterns are shifting, global supply chains are disrupted and remain
under pressure, and different regions, markets and governments are responding uniquely to the
COVID-19 crisis. Companies must continuously adapt to new and uncertain market conditions.
Informed by daily conversations with our clients, we offer industry-specific advice on what
leaders should consider doing now and next.

Study of Internal and External strengths and

weaknesses of privately owned business
SWOT analysis is the internal and external analysis tool which is used to assess the business’s
strengths and weaknesses. It is the widely used strategic management tool which assist the
managers to take strategic decisions (Stevenson, 2011). Those decisions can be taken after the
effective assessment of the firm’s strengths, weakness, opportunities and threats. The SWOT
analysis can be done in the following table.

Strengths Opportunities
i. Strong brands i. International growth opportunity
ii. Strong global market presence ii. Higher business diversification
iii. Broad line of product mix iii. Market development
iv. Economies of scale iv. Opportunity of product innovation for
v. Effective value chain the health purposes
vi. Advanced information system v. Sustainable business enhancement

Weaknesses Threats
i. Limited business diversification i. Fierce competitive rivalry in the
ii. Imitable products and services industries
iii. Over dependence on the retailers ii. Emergence of the tough domestic
iv. Over acquisition in the market competitors and their popularity
v. Higher innovation time cycle iii. High imitation of the production
iv. Threats of the global economic
recession
Table - 1: SWOT analysis framework of Unilever Plc.
Source: (Summers, 2010)

The internal and external factors of the strategic environment of the business are very significant
to be discussed. There is a strong interrelation among the internal factors of the business’s
operations such as strengths and weaknesses and the external macro factors of Unilever (Waters,
2012). Both the factors affect each other and influence the decision making of the business
operation of the firm. Positive presence of the strength sallow’s the firm to utilize the
opportunities of the firm for the better competitive edges. Besides, those strengths reduce the
negative impacts of the macro factors such as threats. On the other side, weaknesses within
Unilever such as limited diversification, imitable and failed acquisition reduces the effectiveness
of the business opportunity of the macro environment such as growth opportunity (Drucker and
Maciariello, 2009). The presence of the weaknesses within Unilever intensifies the threats of
economic recession and increased level of competition. This reduces the firm’s capability to
endure the threats from the market that can be harmful for the firm’s operation.

TOWS analysis is the analysis of firm’s threats, opportunities, weaknesses and strengths to take
strategic decisions. Unilever has various threats which mainly come from the firm’s external
macro environment such as higher competition, economic recession which may drastically alter
the business performance in a bad day. Besides, various opportunities can positively affect the
firm and enhance the firm’s volume such as high growth opportunities, higher diversification,
cost differentiation, market development and higher innovation (Drucker, 2012). Unilever takes
decisions based on that external macro environment which affect the firm’s operations
positively. On the other hand, firm have several weaknesses such as imitable products and
limited diversification which makes the decision making even tougher. Besides, strengths like
stronger brands, higher economies of scale, broad line of product and higher market presence
help the firm to take effective decision making.

Hence I hope that Mr. Kajiman Gurung understands all the ways to establish a private
organization. This study delivers most of the important things to be considered while opening a
private company or middle scale companies. There are different types of private companies so
Mr. Gurung can easily choose what type of business does he wants to open and this study also
examines how the company operates which I have discussed in this with example of one of the
biggest transnational company Unilever and this study tells us how can we measure the strength
and weaknesses of the company and what impacts the companies are facing in this pandemic
situation.
Refrences
Baron, P. (2012). Business and its Environment. 7th Ed. London: Prentice Hall.

Begg, D., (2013), Foundations of Economics, 5th ed., McGraw-Hill Higher Education.

Daniels, J.D., Radebaugh, L.H. and Sullivan, J.H., (2012), International BusinessEnvironments
and Operations, 14th International ed., Prentice Hall, London.

Palmer, A. and Hartley, B. (2011). The Business Environment. 7th Ed. Maidenhead: McGraw-
Hill.

Mullins, L.J. (2014). Management & Organisational Behaviour, 9th Edition, Harlow: Pearson

Education Ltd.

Brown, A. (2013). Organizational Culture, 2nd Edition, Harlow: Pearson Education Ltd.

Burnes, B. (2014). Managing Change, 5th Edition, Harlow: Pearson Education Ltd.

Fritz, R. (2013). Corporate Tides. San Francisco: Berrett-Koehler Publishers, 1996. Print.

Pugh, D. S. and Hickson, D.J. (2011). Organizational Structure in Its Context. Farnborough,
Hants: Saxon, 1976. Print.

Palmer, A., and Hartley, B., (2011). The Business Environment, 7th ed., London /Boston:
McGraw-Hill Higher Education.

Slack, N., Chambers, S. and Johnston, R. (2010). Operations management. Harlow, England:
Financial Times Prentice Hall.

Starr, M. (2013). Operations management. Englewood Cliffs, N.J.: Prentice-Hall.

Stevenson, W. (2011). Operations management. Boston: McGraw-Hill.

Summers, M. (2010). Analyzing operations in business. Westport, Conn.: Quorum Books.

Waters, C. (2012). Operations management. London: Kogan Page.

Drucker, P. and Maciariello, J. (2009). Management. New York, NY: Collins.

Drucker, P. (2012). Management. New York: Harper & Row.

Ansoff, H. (2010). Strategic management. New York: Wiley.

David, F. (2010). Strategic management. Englewood Cliffs, N.J.: Prentice Hall.

Dess, G. and Miller, A. (2010). Strategic management. New York: McGraw-Hill.

Hitt, M., Ireland, R. and Hoskisson, R. (2010). Strategic management. Cincinnati: South-
Western College Pub.

Hunger, J. and Wheelen, T. (2011). Strategic management. Reading, MA: Addison-Wesley Pub.
Co.