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Critical Issues Related To Business Context

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Discuss about the Critical Issues Related to Business and Management Context.


Introduction: Company Profile

Wesfarmers Limited is multinational company of Australia. It was established in 1914 as corporative firm, which gave goods and services to Western Australian farmers. It headquarter is in Perth and Western Australia. Mostly, Wesfarmers limited deals in chemicals, retail, coal mining and industrial, fertilizers, and safety products.  It is a very big Australian company in which around 220000 employees work in various areas (Wesfarmers, 2017).  

Aims and Objectives:

Every company has its aims and objectives, which it wants to achieve effectively and efficiently. The Wesfarmers limited also has such aims and objectives. The main aim of the company is satisfying its customers’ needs and wants by the help of goods and services. The company also wants to provide better and safe working conditions to their employees. The company also aims to contribute significantly in the growth and success of the retail sector worldwide so that it can manage its business in a well-organized manner and achieve its goals and objectives.    



Wesfarmers limited has various scopes to grow and sustain their business in the market. In the segment of chemicals, energy and fertilizers, the company focuses on marketing issues such as safety, operating responsibly, and capacity and diversity to improve their sustainability (Wesfarmers, 2017). By this, the customers are loyal towards the company and the customer’s base is also increased due to improvement. The company is ethically very sound so there is less interference of the country due to which it has various scopes to enhance its business in various markets.

Discussion: Critical issues related to the business and management

The businesses are not easy task to run. Businesses are surrounded by several risks and uncertainty factors. There are various critical issues, which influence the working and management of the Wesfarmers limited. The company is also facing problem related to sale in food and liquor division of Coles. Wesfarmers limited is not performing well as compared to Germany Company Aldi and other new companies in the Australian market. By this, its sales of Coles decreased by 0.3 percent. By the result of this, the market shares of Wesfarmers are also slipped down. The company is sale its one or more assets to generate capital for the business (Treadgold, 2016).

Now, the company overall sales are improving but there is some critical issues arises in online sale. The sale of the Coles brand of Wesfarmers limited is increased by 5.2 percent. The response of online sale is very good but there some problem arises in technology. The company faces the problem relating to technology. There are several peoples wanted to purchase goods and products from the Wesfarmers limited but they are not surfed on websites due to technical issues (The Conversation, 2013).

The Wesfarmers has also faced the price deflation issue related to Coles supermarket business. By this, the net profit of Wesfarmers was decreased 83.3 percent in the year of 2015, which is influence the overall profit of the company. The company is also facing the issue of climate change resilience. The employees, customers, community and the economy are facing problem related to shortage of the water and scarce food supplies. The Wesfarmers limited is monitoring the greenhouse gas and do want to reduce them at any cost. The company also addresses those business activities, which hampered the climate of the country. The company is also doing business in chemical, energy and fertilizers segments. In these segments, there is safety and maintenance issues arise. Wesfarmers limited is emphasizing on this issue and now maintained workplace safer for visitors and employees by focusing on strategies targeting risk reduction, improving physical and mental health, and safety leadership (Wesfarmers, 2017).


Impact of Internal and external factors 

The working of the company is influenced by the internal and external factors of the company. The internal factors like employee’s behaviors, business culture, communication and company leadership. Wesfarmers limited is also influenced by these internal factors. If behavior of employees is good then they do work very efficiently and effectively. However, when they are not happy with leadership style or communication of the company then they are de-motivated and are not able to work effectively. The organisation is also influenced by business culture such as good employer or employees relationship, family friendly policies and teamwork. If the business culture is friendly according to its employees then it provides friendly environment to the employees (Mercer, 2011).

External factors also influence working and performance of the organization. There are several factors, which affect businesses such as political factor, economic factor, social-culture factor, technological factor, legal factor, and environment factor. Nowadays, the influences of political factors are increased in the businesses. The government of Australia launched competition policy, which is beneficial for the Wesfarmers limited because this policy helps to eliminate the competition and enhance the performance of the domestic companies (Brychan, 2010). Economic factors have also hampered the performance of the company. The market condition of Australia is declined due to instability in the currency exchange and currency devaluation, which also affected the business activities of the Wesfarmers limited. Wesfarmers limited is also affected by social-cultural factors. As it can be observed that today’s customers have become more aware regarding CSR practices and social values, Wesfarmers limited should take care of the needs and expectation of the society in which it wants to operate and survive successfully (Buckley and Ghauri, 2015).

The technological factor also influence the decision of Wesfarmers limited. The organization also considers technological factors to sustain in the market ( Laudan, 2013). Wesfarmers limited uses green refrigeration technology to store the perishable goods for long time. The environmental affects the business of the Wesfarmers. The chemical, fertilizers and chemical segment of the organisation have caused some adverse effects on environment. Therefore, the organisation should consider these internal and external factors while taking any decision regarding organisation because these internal and external factors have a great impact on productivity and profitability of the Wesfarmers (Nieuwenhuizen et al., 2010)     


Domestic and international factors affecting business structures and strategy

Business is very tough to run. There are various internal, external, domestic and international factors, which affect the working, profitability and productivity of an organisation. Wesfarmers limited is also influenced by domestic and international factors. There are several internal factors such as size, life cycle, strategy, business environment and market analysis, which affect the organisation. There are also external factors, which influence the organisation such as advance in technology, focus on sustainability and environment, culture and religious ideologies, and emerging markets (Craig  and Campbell, 2012).

The size of organisation affects organisation culture. Wesfarmers limited is big in size. It has large number of employees work in the organisation. Therefore, it requires large number of skilled manager to manage their employees to run organisation in efficient and effective manner. Life cycle of organisation is also affect strategy and structure of organisation. Since Wesfarmers lies between the stage of growth and maturity, therefore, Wesfarmers is making strategy and modifying its structure according to stage of life cycle. For enhancing the business, Wesfarmers invests their funds in develop new products and modify them (Donoho, 2013).

Every successful organisation makes their strategy and structure by analyzing market. Wesfarmers has also developed their strategy and structure according to market analysis. There are also external factors, which influence strategies and decision of the Wesfarmers. Environment of different countries has also changed strategies of the organisation. Different countries have different environment and cultural so Wesfarmers have to change or modify its strategies and business model according to them. Wesfarmers also considers religious and spirituals factors while making the strategies and structures of the organisation in different countries (Craig  and Campbell, 2012).   



According to the above discussion, it concludes that Wesfarmers limited is influenced by various critical issues such sale of the organisation, financial issues, technology issues, price deflation and climate issues. By these issues, the sale of Wesfarmers has declined by 0.3 percent and the price of its shares also has decreased. It also concludes that internal factor such as business culture, employee’s behaviors, company leadership and communication are influencing working of the organisation. It is also concluded that external factors like political factor, economic factor, social-culture factor, technological factor, legal factor, and environment factor hampered decision of the Wesfarmers limited. It also concludes that domestic and international factor are affecting strategies and structure of the Wesfarmers limited at different countries.


On the basis of above evaluation of internal and external factors affecting business of Wesfarmers, it can be recommended that the organisation should adopt the new technologies according to changing environment. This is because if organisation is not changed, then its competitors can take the advantage and capture its market share. It also recommends that the organisation should analysis and monitors the internal and external factors to prevent from uncertainty and risk of the market. Wesfarmers should conduct research related to need and want of the customers by which it can balance its business according to internal and external factors of the organisation. When an organisation deals in domestic and international market then it should consider the fashion, trends, cultures, religious, competition and environmental factors of the different countries.



Brychan, T. (2010) E-Commerce Adoption and Small Business in the Global Marketplace: Tools for Optimization: Tools for Optimization. Hershey: IGI Global.

 Buckley, P. and Ghauri, P. (2015) International Business Strategy: Theory and Practice. Abingdon: Routledge.

Craig, T. and Campbell, D. (2012) Organisations and the Business Environment. Abingdon: Routledge.

Donoho, D. (2013) International Business Transactions: Problems, Readings & Materials Relating to Trade in Goods and Services. United States: Carolina Academic Press.

Grayson, L. (2012) The Social and Economic Impact of New Technology. Berlin: Springer Science & Business Media.

 Laudan, L. (2013) The Nature of Technological Knowledge, Are Models of Scientific Change Relevant?. Berlin: Springer Science & Business Media.

Mercer, S. (2011) Towards an Understanding of Language Learner Self-Concept. Berlin: Springer Science & Business Media.

Nieuwenhuizen, C., Badenhorst-Weiss, H., Rossouw, D.,  Brevis, T., and Cant, M. (2010) Business Management: A Contemporary Approach. South Africa: Juta and Company.

The Conversation (2013) Wesfarmers boosts sales, but online still a challenge for retailers. [Online]. Available at: (Accessed: 03 April 2017). 

Treadgold, T. (2016) Wesfarmers Facing Retail Challenge, Business News Western Australia, [Online]. Available at: (Accessed: 03 April 2017).

Wesfarmers (2017) Chemicals, Energy & Fertilizers. [Online] Available at: (Accessed: 03 April 2017).

Wesfarmers (2017) Who We Are. [Online] Available at: (Accessed: 03 April 2017).

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