Download Business Environment Characteristics

Business
Environment
Characteristics
Economic
Trends
Markets
The Business
Organisation
Laws
Changes to
sectors or
industries
Name:__________________________
Business Environment Characteristics
The business environment is the world
in which businesses operate.
The business environment is constantly
changing.
All businesses need to keep up to date with events that affect them, and
adapt or change their activities if necessary.
What happens if businesses don’t
change?
Let’s look at 2 examples:
Why is Amazon such a success?
Why is HMV struggling and had to close shops?
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There are 4
make:
main things that affect the decisions that businesses need to
Economic
Trends
Markets
The Business
Organisation
Changes to
sectors or
industries
Laws
We’ll look at each of these. Starting with markets…
What is a market?
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Markets
Types of Market
There are 4
different types of market. Describe each of them:
Mass
market:_____________________________
___________________________________
___________________________________
Product
markets:____________________________
___________________________________
___________________________________
Financial
markets:____________________________
___________________________________
___________________________________
Niche
markets:____________________________
___________________________________
___________________________________
What are the main
markets for this area (Skegness / Alford /
Mablethorpe)?
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Markets
Why do markets change?
Let’s think about mobile
phones.
How has the design changed since the 1980’s?
Why has the design changed?
What other products have changed over the last few years?
Product
What has changed about it?
4
Markets
Market Changes
Type of change
Fashions and lifestyles
Explanation
Examples
To carry out a different activity,
instead of (or as well as) the
original one
Farmers deciding
to run caravan
sites
Supermarkets
selling banking
products
Cheap foreign imports
Diversification
Technological
developments
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Economic Trends
Employment
FACT!
In the 2008/2009 recession:
12% of businesses planned to cut wages and
58% introduced a wage freeze.
Why?
If lots of people are in jobs (high
do?
employment), what are they more likely to
If lots of people are not in jobs (high
unemployment), what will they do?
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Economic Trends
Income
What changes people’s income?
Type of
change
Tax
List some examples
Bills
Price of goods
Price of fuel
If prices keep going up, what type of income reduces?
(CLUE: it’s the money you have left over to spend on what you want)
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Economic Trends
Growth
Economic growth is the monetary value of all of
the goods and services produced in this country. It is
measured by the Gross Domestic Product (GDP)
REMEMBER:
At the end of 2010, the UK’s GDP figure was (-£10.5 billion). What does this
mean?
Inflation
The Government target for the rate of inflation is… _______________
The current rate of inflation is… ___________________
Why does the Government want to control inflation?
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Sector and Industry Changes
Growth/Decline of Sectors
IMPORTANT TERMS:
Absolute growth/decline – a sector is getting bigger/smaller. Eventually it
will disappear
Relative growth/decline – a sector is doing better/worse compared with
other sectors
What are the 3 different sectors in the UK? Circle whether they have
grown or declined?
1. _________________
Grown/Declined
2. _________________
Grown/Declined
3. _________________
Grown Declined
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Sector and Industry Changes
Growth/Decline of Sectors
Look at the following graphs…
Primary Sector - Share of UK Employment
5.00%
4.50%
4.00%
3.50%
3.00%
2.50%
2.00%
1.50%
1.00%
0.50%
0.00%
1978
1988
2008
2010
Secondary Sector - Share of UK Employment
35.00%
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
1978
1988
2008
2010
Tertiary Sector - Share of UK Employment
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
1978
1988
2008
2010
Write a summary of what is happening in each sector.
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Laws (The Legal Framework)
Who makes laws for businesses in this country?
What laws affect businesses?
Laws that affect business
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