P5 M2

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P5 & M2

In this assignment I am going to describe the influence of two contrasting economic environments on business activities within Boots. I will then compare the challenges to Boots business activities in two different economic environments.

Economy is the wealth and resources of a country that is used to produce and consume goods.

What makes an economy strong?
The output makes an economy strong output is the ability for an economy to produce goods and services to sell. These then create jobs for people and workers would get income and spend money, therefore businesses make more revenue, which allow them to receive all kinds of tax; NI (National Insurance), VAT and corporation tax paid to the government.
In order to determine the
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They will then have competition with stores like Superdrug. They will have to spend a lot of money on advertisement to help promote the store and to help their products sell more by doing sales like ‘Buy One Get One Free’ or ‘2 for £5’, so they don’t lose their customers.

The opposite of this would be if interest rates are low it would be easy to borrow money from the government. So Boots wouldn’t have any pressure in having to repay the interest rates and they won’t be forced to put the prices up, they can put the prices down which will then attract customers as majority of them will definitely afford the products they want. There won’t be any cut back on cost so Boots will gain customers instead of losing customers and they will have high sales due to their products being sold. They wouldn’t have to have any competition as they are gaining the customers they want, the more customers that come help advertise them because the customers can ‘tell a friend to tell a friend’ giving Boots a good reputation of well-priced products.


Promotion: during recession customers will limit what they buy and only spend money on necessities instead of extra luxuries. So in Boots; If majority of their products are not seen to be providing value, they would have to improve the quality of that product as well as resorting to cutting down the price and temporary price deals like Buy 1 Get 1 Free, to help
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