Elements of Small Business Environment

1534 WordsMar 24, 20137 Pages
THE ELEMENT OF THE SMALL BUSINESS ENVIRONMENT Entrepreneurship Individual Assignment THE ELEMENT OF THE SMALL BUSINESS ENVIRONMENT Entrepreneurship Individual Assignment NGUYEN THAI HA B0074 - BA505 ETR401 | LECTURER: MR. NGHIAHT NGUYEN THAI HA B0074 - BA505 ETR401 | LECTURER: MR. NGHIAHT CONTENTS I. INTRODUCTION of ENVIRONMENT II. INTERNAL ENVIRONMENT III. EXTERNAL ENVIRONMENT 1. Task Environment 2. General Environment IV. CONCLUSION V. PREFERENCES I. INTRODUCTION In order to start up or become effective, each new and current companies have to use a number of elements within the environment to gauge the path by which they ought to steer. So what is…show more content…
It derives five important forces that determine the competitive intensity and therefore, the attractiveness of a market. 5 typical factors have direct impact on the business. 2. General Environment – Macro Environment The General Environment can be described by PESTEL model. It refers to all forces that are part of society, affect business and micro environment. * Political factors include: * Government’s stability * Social policies: welfare, etc. * Trade regulation: EU & WTO, etc. * The Government set the laws, regulations and policies that can promote or limit the individuals and organizations in a society * Economic factors: * Economic growth * Unemployment rate * Interest rate… * Economic factor can effect purchasing power and spending patterns. “Element like interest rates affect a firm’s cost of capital and therefore a business grows and expands. Exchange rates affect the export and import goods in an economy.” * Social factors: * Demographics Demographics studies population patterns: sizes, age, sex, occupation, ethnicity, etc. Those patterns are investigated for companies to change various strategies to adapt to these social trends, such as recruiting staff or design suitable products for each segment Let take an example of age changing structure in US: * Generation Y: born 1980 – 1995 -> technology wise, optimistic, confident, sociable, flexible
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