Business Economics - Property Economics
The purpose of this essay is to analyse the performance of Barratt Developments PLC as an example of any organisation in terms of business, economic and management concepts.
One of the most important and influential elements of the business environment is the structure of the industry. How a firm performs depends on the state of its particular industry and the amount of competition it faces. (Book) To describe the characteristics of the modern construction industry we should look at the nature of demand for industry’s products which is related to wants. In this case there are some particular characteristics; demand for houses, hospitals, office buildings, schools and many other structures. That is one of the reasons why its looks as it does. In this context it means the quantity and value of for example houses that people or organisations want and are prepared to pay for.
Demand for buildings is a secondary demand which is determined by demand and output of other goods and services. The number and type of hospitals and schools depends on decisions by government and it is based on need and available finance, building offices depends on demand for office space. It becomes more complicated with houses because they are more like consumer products. It is determined by population structure and movements, by income, household formation and mortgage conditions as well as it depend on the area it is built on. It happened before that houses built in North of England were demolished a few years after they were built because there was no demand for them.
The construction industry may be called bespoken which means that customers describe type, place and many other factors of the building they want to buy.
Putting those two together we can conclude that the industry is much less capable of manipulating demand for its product than any other producers. (Reading 1)
The UK Government has made housing a key priority going forward and has set out an ambition to increase
One of the most important and influential elements of the business environment is the structure of the industry. How a firm performs depends on the state of its particular industry and the amount of competition it faces. (Book) To describe the characteristics of the modern construction industry we should look at the nature of demand for industry’s products which is related to wants. In this case there are some particular characteristics; demand for houses, hospitals, office buildings, schools and many other structures. That is one of the reasons why its looks as it does. In this context it means the quantity and value of for example houses that people or organisations want and are prepared to pay for.
Demand for buildings is a secondary demand which is determined by demand and output of other goods and services. The number and type of hospitals and schools depends on decisions by government and it is based on need and available finance, building offices depends on demand for office space. It becomes more complicated with houses because they are more like consumer products. It is determined by population structure and movements, by income, household formation and mortgage conditions as well as it depend on the area it is built on. It happened before that houses built in North of England were demolished a few years after they were built because there was no demand for them.
The construction industry may be called bespoken which means that customers describe type, place and many other factors of the building they want to buy.
Putting those two together we can conclude that the industry is much less capable of manipulating demand for its product than any other producers. (Reading 1)
The UK Government has made housing a key priority going forward and has set out an ambition to increase