The interaction between the different business sectors in the UK and the impact of external factors on business.

The business sectors of the United Kingdom (UK) is categorised into 3 major sectors namely Primary, Secondary and Tertiary sectors.
The Primary sector are the organisations that are involved in the use of natural resources through extraction, growing and collection of raw materials such as mining, quarrying, fishing and exploration. An example of a primary sector business is Shell UK who focuses on exploring new global oil and gas reserves.
While the Secondary sector is also known as the manufacturing sector, these organisations are involved in processing, production or refining of the raw materials from the primary sector into finished goods, this sector creates a finished , useable product like car manufacturers, textile manufacturers, oil refineries Jaguar etc. an example of a business in this sector in the UK is Kellogg’s.
And tertiary sector are organisations involved in providing services to people either to direct customers or other businesses which may be public or private sector, such as education, health, hospitality, leisure and financial institutions example of a business in this sector is Barclays bank.
In every business sector there are stakeholders. Stakeholders of any business are any one that has an interest in the activities of the business. The key stakeholders in the business sectors of the UK are the Government, Local community, suppliers, employees, customers and the business owners. They are very important in a business in that they affect the business directly or indirectly and because of the differences in the aims of these stakeholders this may affect the overall objectives of the business in general. Conflict arises when the interest of one stakeholder affects another.
The suppliers for instance want good communication in order to ensure the right products are delivered at the right time to the right place. They also want to be paid on time, therefore businesses will have to set a target to pay suppliers within the given period of time, if not this will disrupt the business activities. The local community want local jobs for local people and improved facilities but not at the expense of the environment that is they want the business to operate responsibly in their community. Employees want job security and for the business to have promotion opportunities, decent wage and good ethical values, these aims may affect the business objective especially a profit making organisation. Small businesses rely mainly on relatively small customers hence these customers become quite powerful and set a term that may affect the business objective for example a small business selling to a supermarket will have to accept the terms offered by the supermarket in order to get the order from the supermarket. Owners of a business are the most important stakeholder, they decides the business objectives and most importantly they want to make profit but will have to put in place a program that will consider the aims of the other stakeholders without any negative effects. Most stakeholders can affect the business through Negotiation, direct action, refusal to cooperate and also through voting.
In the UK the tertiary sector is the largest sector in terms of contribution of GDP and employment, it grows faster than the secondary sector. The three business sectors in the UK interact with each other in various ways in that for a business to get a product to the consumer it has to start somewhere.
Let’s take Tesco supermarket as an example, Tesco set up a sustainable dairy group to help support UK dairy farmers, the group works closely with over 650 farmers to ensure milk prices are fair and helps farmers to share experiences and ideas on how to increase and improve supply chain.
Another example of interaction of business sectors in the UK is the banks providing loans and other financial services to other businesses. For example Barclays giving loans to a production company for the cost of the machineries used for production.
The aims or interests of stakeholders determine how the business sector in the UK is affected by external factors such as; Social, Legal, Economic, Environmental, Political and Technological.
For instance, business decisions may be influenced by political factors through the government. The UK government uses taxes and spending to influence the way a business operates, for example, recent public sector budget cuts by the UK government has affected most business organisations which has led to some of them closing down thereby leading to increase in the rate of unemployment. Also the increase in university fees is affecting the education sector, for students this has meant making key decisions about how they intend to pursue their careers. This in turn has meant that academic providers need to review how they will meet the challenges of generating income. The UK government accounts for up to 40- 45 per cent of all goods and services produced in the economy, so categorically the government as a major stakeholder to businesses in the UK has massive influence politically.
Economic factor also influence the business sectors like the recent recession in the UK economy has had a massive blow to businesses in that interest rate has gone up and it’s hard for businesses to secure loans to carry out their activities. Also this has led to increase in the cost of production thereby increase the prices of goods and services.
An example of technical influence on the business sector is the emergence of the internet which has led to rapid take-up of online banking which at the same time as offering consumers greater convenience also enables retail banks to lower the costs of managing customer accounts.
It is evident that UK business sectors interact with each other on different platforms either directly or indirectly depending on the sector, this interaction sometimes have positive or negative effect but what is important is how the business deals with it in order to achieve its overall business objective in proportion with all stakeholders’ interest in the business.