Influences in the business operating environment and nature of business
Learn the key concepts from Unit 1 Nature of business
External influences types
Economic, financial, geographic, social, legal, political, institutional, technological, competitive situation, markets
Internal influences types
Products, location, resources, management and business culture,
anything that affects the operation of the business
the predictable long term pattern of changes in the national income measured in GDP
Changes in attitudes, values and beliefs of society that affect their behaviour.
Framework of laws and regulations that govern the operation of a business
Different ideas that are implemented by the different political parties
Framework of regulatory authorities and other organisations that influence the operation of a business. Eg Dept of the environment, trade unions.
Changes in technology that influences the way products are produced and marketed and how businesses operate to decrease costs and improve productivity.
Factors that influence a business' competitiveness are ease of entry into the market, number of competitors, local and foreign competition and marketing strategies employed by competitiors.
size of the market, size of the business, number of competitors, nature of the product, and changes in markets.
Proximity to support services, visibility, cost, proximity to suppliers, proximity to customers
Things like finance, employees, physical resources like equipment, raw materials, and information resources.
Management and business culture
The values, ideas, expectations and beliefs shared by the staff and managers of the business.
Any group or individual on whom the business actions impact like the society, managers, employees, the environment, owners ( shareholders) and customers.
Owners, managers, employees
Customers, Suppliers, unions, government, society
includes those factors over which the business has little control, such as government policy, technology, economic conditions and social attitudes.
includes those factors over which the business has some degree of control, such as products, location, resources, management and business culture.
Phases of an economic cycle
Upswing, boom, downswing, recession
Analysis of political, economic, social and technological factors
Type of good or service, range of products available, and size of the business.
Evidence of a contracting (declining) economy
Less consumer spending, cost cutting by businesses, business profits falling, prices falling and more people unemployed.
Evidence of a expanding economy
Rising prices, more business profits, more employees required, increased confidence and spending by consumers.