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External Influences on Two Chosen Businesses Essay

Decent Essays
External Influences on Two Chosen Businesses

Ikea

External influences are factors outside of the business that affect the business, and it has no control over them.

Competition

Ikea have got many competitors nearby but this does not have a major affect on them as they are constantly competing on prices, quality, availability and their product range. They have got many different competitors selling the same types of products as them; their main competitors are B&Q, Homebase, Argos, DFS, and Toys R US. These businesses are in similar markets and have a similar kind of product range as Ikea.

With Argos Ikea mainly compete on furniture and DIY goods, which are quite similar to
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For Ikea getting money is no problem they don't have to borrow money from any banks for the reason that they have got their very own company bank, so if an Ikea store needs to borrow any money, they borrow it from their main bank. This is a very good thing as the money stays in the business and no interest is charged.

Exchange rates play a major part in the running of Ikea; this is because Ikea are an international company. They rely on the exchange rates in order to get money back into business. If the exchange rates were increase this would be very good for Ikea and they will be very well off. But if exchange rates were to decrease, it would lead to a downturn in Ikea's profits and affect their sales.

Environmental constraints

Environmental constraints are laws and regulations that businesses needs to follow in order to ensure that they're not harming the environment.

Ikea are a business that are very environmentally friendly and try their best to try and keep the environment free of any harm or destruction. Ikea aim to help protect the environment, they try to do this by using only wood or wooden fibres because wood is renewable, recyclable and
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