Gcse business studies
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Published: Mon, 5 Dec 2016
GCSE Business studies
Unit Two: People and business
The role and importance of stakeholders
The Company I have chosen to investigate is Sainsbury’s. Sainsbury’s was founded by a man called
John James Sainsbury and his wife Mary Ann in 1969 In London. The business started to grow and
expand until it became the largest grocery retailer in 1922.
Sainsbury’s store is known as the third largest chain of supermarkets in the UK. Sainsbury’s is
in the Retail industry, the tertiary sector. Sainsbury employ up to 150,000 people and have 792 stores.
These stores include 502 Sainsbury’s supermarkets and 290 Sainsbury’s convenience stores.
Sainsbury’s headquarters is in Holborn Circus, London, England.
The reason I picked Sainsbury’s as the business I want to investigate is because it’s one of the
fastest growing retailers and has many stores within the Uk. It’s also one of the most commercialized
My Local Sainsbury’s is Sainsbury’s Superstore Dalston Cross Shopping Centre London
The role and importance of stakeholders
A stakeholder is any group or individual which is affected by the activities of the business.
- Internal stakeholders: are inside the business.
- External stakeholders: are outside the business.
Shareholders also known as stockholder own parts of the business.
Stakeholders have an interest in the business but do not own it.
Interest of different stakeholders
Good return on investment.
High pay. Safe and healthy working conditions.
Fair price for good quality products.
Regular business and on time payment.
- LOCAL COMMUNITY
Jobs and minimum disruption.
Employment for the local community and taxes.
- PRESSURE GROUPS
Care for environment and no pollutions.
Loans back on time.
Owners and Shareholders
Shareholder: is a person or organization owning shares in the company.
Owner: is someone who owns (is legal possessor of) a business.
Shareholders and Owners are stakeholders with a financial interest in the business.
They also want to receive a large proportion of the company’s profits. This is also known as a dividend.
Shareholders hope that share prices will rise.
There are four different types of shares there’s the:
- Ordinary shares, they have no specific rights or restrictions. If the business wound up these types
of shareholders are the last to get paid.
- Preference shares. In this category the shares have a fixed value. This means that the shareholders
will not benefit from an increase in profits. If the business is in trouble they have the rights to
their dividends ahead of the Ordinary shares.
- Cumulative preference shares give holders the right that, if a dividend cannot be paid one year,
it will be carried forward to successful years. Dividends on cumulative preference shares must be paid,
despite the earning levels of the business.
- Redeemable share. This is when the shareholder gets back the money he has paid for his redeemable shares.
Owners and Shareholders of Sainsbury’s
Sainsbury’s supermarket is a private limited company, which is also known as an Ltd.
Although the parent of Sainsbury’s supermarkets is J Sainsbury’s a public limited company
which is also known as a PLC. The chairman of J Sainsbury’s PLC is Phillip Hampton as Justin King
is the chief executive officer. Public limited companies are often much larger than private limited
companies. They are able to advertise their shares and their shares could be sold on stock exchange.
They have to publish financial information each year.
Is a person who works for another person or Business.
They will want to see how much profit the business has made. If the business has made high levels of profits,
employees may look for wage increases. Also high profits may also mean that he employee’s job is secure.
A person appointed by the shareholders of a company to take part in day to day management of the business.
Someone who plans and co-ordinates activities within a business and has authority over more junior
Someone who has day to day responsibilities for operatives, ensuring that they work effectively and
dealing with problems as and when they arise.
Is someone who carries out the basic functions of the business.
All employees whether part time or full time are very important stakeholders. They are closely involved
in a business and they are strong influences on the way the way the business is run. Employees want
to be able to see how much profit the business has made. If the business has made high levels of profits,
employees may ask for wage increases. High profits may lead to also meaning that the employee’s job
is secure. An employee will want to work in a clean and healthy environment and flexible working.
They want to be treated fairly and want their work to be recognized by their supervisors.
Employees of Sainsbury’s
- They have responsibilities for aspects of the business. They are under the guidance of a director.
- They plan activities and look after employees.
- Manage finance and attempt to meet targets set by directors.
- Their jobs are usually secure due to a permanent full time contract.
- Making decisions and solving problems is central to them.
Managers often have a professional qualification in accountancy or marketing. Managers need to have
good communicational skills, good IT skills and able to control finance. Managers pay varies.
- Also known as team leaders.
- Monitor work of junior employees.
- They ensure that production and quality targets set by managers are met as soon as possible.
- They advise managers of any difficulties as they arise.
- They are the most junior employees.
- Responsible for their work only.
- Usually carry out routine tasks.
- They have little job security. When their contact runs out they may end up unemployed.
Operatives are usually unskilled. This leads to low pay.
Customers: are individuals or organizations that buy products from businesses.
Businesses are mainly customer focused. They play in big part in fulfilling the customer’s needs
and expectations. These include good quality products for fair prices. Customers want to get products
that are worth. They don’t want to be paying for products which are no use for high prices. After sales
service and support. Customers also want to know if a business is financially sound. They will not want
to place orders, or pay deposits, to a business that might not be able to continue trading.
In order for Sainsbury’s to gain more customers and please the ones they have they need to consider
Value for money. If Sainsbury’s does not offer this there is a high risk that they will lose customers.
This is a reason why supermarkets such as Sainsbury’s and Tesco like to keep an eye on competitor’s prices.
To make their prices more competitive. Sainsbury’s are very popular for the stating clear information
that is needed on the label. This information consists of the price and other relevant information such
as the ingredients.
By Sainsbury’s offering specialist advice about their products is a way they are
able to win new customers. Many people prefer to shop online rather than going to a store. Sainsbury’s
have provided their customers with an online shopping website, where customers can order what they want
through the computer and get it delivered to their house. By queues being very long in supermarkets,
many customers may get put off, leading to Sainsbury’s losing customer. So Sainsbury’s put in place a
self check out when customer with a basket are able to do a self check up instead of queuing up.
This is a fast and easy way for customers to purchase products. This is something else that attracts
Sainsbury’s are encouraging customers to make healthier choices and provide a broad range of products.
”To deliver an ever improving quality shopping experience for our customers with great products at
fair prices. We will exceed customer expectations for healthy, safe, fresh and tasty food, making their
lives easier every day.“
Suppliers expect to be paid on time and receive regular orders from customers. They are interested
in any developments that might affect the number and size of orders being placed.
Sainsbury’s want to deliver their greatest all the time. In order for Sainsbury’s to achieve this
they need to work closely with their suppliers. Sainsbury’s have roughly around 1,400 direct suppliers.
Supplier need to make sure the products are in good conditions and correct. If this is not the case
Sainsbury will end up with many customer complaints. The tension that can be present between Sainsbury’s
and their suppliers may include prices. How much the products are going to go for. Sainsbury’s make sure
all payments are paid on time unless any errors occur in order to keep the relationship with their
The local community
Many businesses are very involved with the local communities. The local community will want Companies
to provide employment for the people within that community. They don’t expect any business in their
local community to cause disruption and, environmental issues or any other problems which may cause
damage or disruption to the local community.
Sainsbury’s local community
Sainsbury’s play an important role in their community. Sainsbury’s does not only provide items from
their store they also provide different activities for their community. Sainsbury’s is the only retail
partner of comic relief, where they helped raise 7 million for comic relief. Active kids are a programme
which proves their aim which is to be the number one supermarket for health. Active kid is an activity
run to increase fitness levels, to keep you children fit, active and healthy. Sainsbury’s has proven
to be environmentally friendly and that the local community has a say. This is due to the local
community being the main customers of Sainsbury’s and without them Sainsbury’s will not be profitable.
Sainsbury’s take into account the customers need and wants in order to keep them happy.
The government is interested in every business for a variety of reasons which include the collection
of taxes by the Inland Revenue. They are very interested in the finance of the business. Also customs
and excise which is another tax collector (VAT) value added tax. Businesses are obliged to respond to
any of the government’s request and have to pay taxes to Inland Revenue and customs and excise.
These are organization to promote causes. An example of this group is Green peace and friends of the
earth which look to protect the environment. They campaign against the export of live animals.
Preesure groups tend to influence many businesses by campaigning against firms which behave in
unacceptable ways. Pressure groups also take direct action against some firms. Businesses tend
to respond to pressure groups for them to gain a good public image.
Gain and retain customers / Gain customers satisfaction and loyalty
In order for a business to gain and retain customers they need to do the following:
- Good value products:
A customer finds value for money very important. In order for customers to gain and retain customers
they need to provide good value product, otherwise they will lose customers. This is why Sainsbury’s
keep prices very competitive.
In Sainsbury’s every product is worth it. They try their best to please their customers with their
products. However If a product does not meet customer’s expectations Sainsbury’s does their best
to solve it, whether by a refund or exchange depending on the circumstances.
- Clear and honest information:
Make sure the customer have a clear sight of the amount they need to pay. This may be stated on the label.
If a customer is told they need to pay more than what is stated on the label may lead to loss of customers.
In Sainsbury’s all products have labeling with clear and simple information. The ingredients are all
stated at the back of the label and if any important information needs to be stated they put it at the
front i.e. contains nuts. Every product has the price either on their label or on the shelf under the
product. The price it states on the label is the price you pay at the counter. Sainsbury’s make sure no
hidden charges are made. This attracts many customers to Sainsbury’s.
- Information about products:
Offering specialist advice on any products attracts customers as well as retains current customers.
This allows individual customers to receive individual help and advice on any products.
Customers like to get attention.
In Sainsbury’s the employees are very kind and helpful. Around the store you get the employees asking
you if they may help with anything and also help with any misunderstanding the customers has from reading
the label. In Sainsbury’s you get told extra information on products that tend to be very helpful.
- Having efficient ordering systems:
Customers like to receive products, not long after they order. Online tracking systems are available
in most Businesses. These state when products are due to receive the customer. In order to keep
customers a business needs to make sure that products are receive on the Receive by date otherwise
it can be a disadvantage to the company.
In Sainsbury’s there is an
Online shopping website which allows the customer to order products online. Sainsbury’s also provides
the customer with any information of when the products will be dispatched and at what time roughly the
customer should receive the products. If Sainsbury’s fails to deliver on time, it will be a great
disadvantage as customers will lose trust in the business.
- After sales Service:
Having a after sales service allows customers which buy guaranteed products to get any feedback on
the product, to make any repairs or replacements on damaged products.
Sainsbury’s has an after sales service which allows any customers with any enquiries to contact the store
and sort it out.
- Dealing quickly with any inquiries:
Business should be very quick when it comes to handling complaints. Telephone numbers and addresses are
available for customer for when necessary.
Sainsbury’s has an in store customer service desk where any customer inquiries may be handled and dealt
with on the spot. If customers are not happy with any products or the way they have been treated they
can solve it at the customer service desk.
- Help with specific products:
Nowadays products can be bought in different ways. Many customers will want to receive information on
a loan and the customer’s service will provide this. Or even provide the customer with the loan themselves.
- Personal attention:
Customers feel more satisfied if they can speak to a member of staff individually, to help sort out
As I stated before Sainsbury’s is very good at this and staff at Sainsbury’s tries their best to get
around to all their customers.
Customer loyalty is created by a strong relationship between the customer and business. This involves
the customer’s feelings, where customers feel important and tend to buy products based on their feeling
toward the business.
Improve the image and reputation of the business
The logo of a business plays and important part in the business so the logo should be used to
demonstrate a business. Within the store it’s very professional and attracted if the business has
their own company uniform. It’s a way of advertising their businesses to all customers. A business
should also keep up to date advertisement through the media in order for the public to know about the
business and any new things that may affect the business or businesses customers. This makes customers
feel the business is very professional and makes the business gain a good image.
By a business providing customers with good products and supplies may lead to satisfied customers
spreading the word to any friend and family which will not only lead to good reputation for the business
but also gains new customers and keeps old customers.
Help business to keep market shares:
Customers which remain loyal to the business and new customers who are won by the business help the
business retain their market share.
Increasing sales revenue and profits: satisfied customers which repeatedly buy from a business can
also encourage others to do so as well. By a company gaining new customer will also increase a company’s
sales revenue which May also lead to increase a business profits.
Different types of customers within a business
There are two types of customers in businesses these include external and internal customers.
- External customers:
These are people outside the business. These are normal, common everyday customers who purchase
products and service from a business.
- Internal customers:
These are people within the organization who need information for an external customer.
Internal customers within Sainsbury’s may be Employees which are having a hard time at work and which
are being treated disrespectfully and have had enough of it. These people will visit the human resources
department to ask for help.
In order for me to carry out important information about Sainsbury’s and their products and services
I conducted some surveys. I went to shepherdess bush and handed my survey out to 12 different people.
This number is very small to get a reliable conclusion from it. The problems we had with the surveys
are that many people did not want to fill them in and wanted to know what they were for. Also Westfield
shopping centre also didn’t grant us permission to hand out our surveys.
Good value products
Many people stated that the prices of their supermarket are something that attracted them to go to that
supermarket. Some people also stated the customer service is really good and there for they repeatedly
visit the store. They said the quality of their products is excellent and they rated the customer
service very high. This suggests that good customer service and valued priced products are strong
factors to a customer and their feeling towards the store.
Clear and honest information
Customers said that the customer service was excellent which will lead to us saying that they get a
lot of information about products and that customers have a clear understanding of the product and
the use of it. The customers get individual attention and information on products.
Information about suitable products
Customers feel they get attention within the store they get any help and information need for
different products. The customers are ensured a clear understand of the product and the terms and
conditions when bought. They are told important information and also warned for dangerous products.
Help with individual or general issues
If a customer has any inquiries or complaints that need dealing with. Sainsbury’s is quick to handle.
They try and sort it out on the spot and make sure that everything is cleared and that the customers
end up happy. Each individual received individual help and attention which makes the customer feel valued.
Following the surveys, the things that Sainsbury’s can improve are little. Price need to be clearly
labeled to the right product as prices may sometimes be misleading to different products.
People want bigger aisles so it is easier for more than 2 trolleys to pass by.
In order for a company to remain competitive it is important that they collect information about
their market. This is called market research and may be done in several ways. This information will
provide the business of what goods and services customers want and need, what the overall view of
customers is about the businesses current products, the strengths and weaknesses of competitors and
the expected future sales of products.
Questions from staff
Employees are able to ask any question to their customers about their views on the business and their
products. Market research is regularly carried out within Sainsbury’s. Regular contact is in place
between the customer and their representative’s in order for questioning to take place.
This a type of market research where customer’s behavior is watched and recorded.
These are sets of questions written to collect information from a large number of customers.
Getting customers to fill this survey out is an easy way to get what customers think. This type
of market research is very cheap to produce. People who tend to receive this Type of market research
by post hardly bother to fill them out.
These are small groups of people who meet up regularly to offer opinions on a business’s product.
They give view on the advertising of a company and any ideas of new products or special offers.
They provide useful and detailed information.
Most businesses have their own websites. These websites are used to advertise products and get customer
Most business websites also has a contact us section where the business provides us with a number,
address and email of the business. This is a way customers are able to get their view across and also
get any complaints across.
Features of customer service
- Communication skills
- Accuracy of information
- Availability of products
- Clear information
After sales care
- Customer care telephone lines
- Dealing with complaints
- Repairing goods
- Exchanging goods
- Range of methods
All products must meet the expectations and needs of the customers. The goods need to be of good quality.
Health and safety information should be in place for any customers who buy a product which it applies to.
Packaging of products should provide information which help customers. The packaging should be easy to
open so customers don’t hesitate to open or need any further equipment to open the packaging.
All employees need to have the skills needed for their job. Training should be in place for employees
in order for them to received detailed information on their business and its customers. This is also
useful for customers which may ask questions. So the employee may give a direct answer. Communication
skills training should also be in place in order to help employees to be polite, patient and able to
give simple answers. This is also very important during telephone conversations. Employees should be
quick with any inquiries, be helpful and also friendly. By employees wearing their business uniform it
makes it easier for them to be pointed out by customers.
After sales care
Good after sales care is when the business deals quickly and fairly with complaints, exchange goods
that are faulty or do not meet the customer’s needs, when they repair guaranteed or paid for goods and
when the business is able to offer advice and support to customers.
Products are expected to be delivered on time. Speed is also important in some circumstances where
some foods may go off.
Many businesses give the choice of how the customer decides to pay for its goods or services. In terms
of expensive items a credit by the business should be offered.
Modern technology has helped many businesses update and improve their services.
A business website offers customers with up to date information with businesses products and answered
questions. Products may be purchased over the internet giving the customer the chance to shop at anytime.
Also any inquiries or complaints may get across to the business by email.
In the UK there are a number of laws to protect the health and safety of consumers.
Health and safety
Health and safety Act, 1974:
This one of the main laws in the UK. This law handles the interests of its employees and consumers.
(Labeling dangerous substances)
Food and Drug Act,1984:
This law states the things that may and may not be added to foods. It is illegal to sell foods from
dirty and unhygienic premises.
Food Safety Act, 1990:
This law states it is illegal to sell consumers food of poor standard. Applies to farmers, restaurants
Consumer’s protection Act, 1987:
This law covers dangerous products and the safety of consumers. The businesses are liable for any
harm caused to consumers by their products.
The sales of products
This law looks after customers when they are buying goods and services.
Sales of goods act, 1979:
When products are sold they must be undamaged and in good working condition. They are expected to work
and perform as they are described.
Consumer credit act, 1974:
Some customers when purchasing products and services borrow money. This act prevents businesses to
charge high rates of interest and gives the customers the change to change the mind on whether to borrow
the money or not.
The labeling of products
Much information is given to customers through the label. This act prevents the customers from being
given false information about products.
Labeling food regulations, 1970:
Pre packed food must contain a list of ingredients on the label. Foods
within the UK having more than 1% or more of genetically modified ingredients must be labeled to make
Weights and measures act, 1986:
It stated the weights and measures that are used in trading. Weights and measures must be accurate and
must be as shown on the labels.
Trade description act, 1968:
Act which makes it illegal to give a misleading description of products on the packaging or advertisements.
The misuse of information
Businesses collect a lot of information about their customers. This law prevents the misuse of this
Computer misuse act, 1990:
It is illegal for people without authority to have a look or use your confidential information.
The data protection act, 1998:
Businesses are required to store personal information to maintain data securely. Individuals have the
right to ask for any changes to be made to it. The business has not got the right to share your
information with anyone else.
Investigating job roles and working arrangements
Organisations are structures in a number of ways. The structure of an organization will determine the
performance of the organization. Organisational structures allow the different responsibilities for
different functions to be clearly allocated. Organisation structures aim to increase efficiency and
success of an organization. A businesses organization is usually presented in an organizational chart.
This is a plan that shows the division within a workplace between employees. Organisational charts help
employees to see how they fit into the business. They present different job roles and a short description.
The five main job roles within a business are the chief executive, the directors, the manager,
the supervisors and the operatives.
A chief executive is one of the highest ranking officers which have total control over all management.
They create an effective organization to increase chances of delivering excellence within a business.
They manage professional staff to enable them to maximize their contributions. They need to keep
constant reviews of the company’s progress in order to meet and set new targets. Have responsibilities
for setting budgets and in most company’s they have to have day to day responsibilities to finance.
The chief has a leading role to all the other workers and get the last word in any decision making.
They decide how a store is going to be set out and which employees are going to be sent to which trainings.
Have you noticed that all Sainsbury’s look the same and everything is laid out in similar places to other
stores, well that’s a decision which is made by the chief executive and that the workers need to do.
Managers have an important role within a business. They work under the guidance of the directors.
They plan any activities. Look after employees, manage finance and try meet targets set by directors.
A manage usually has a secure job as they have a full time contracts. They have the duty to make decisions,
i.e. How many new employees are needed? They need professional qualifications such as accounting and
marketing. They need to have good communication and IT skills. They draw up plans; look after human and
non human resources and attempt o meet the business targets.
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