Pest Analysis

Topics: Economics, Ronald Coase, Transaction cost Pages: 4 (1115 words) Published: March 16, 2012
Tutorial 1: Markets and Organizations

Q1. Case Study
Managing external influences

First Group (First) is the UK’s largest transport operator, employing more than 137,000 people in the UK and the USA. In the UK, it runs rail services carrying around 275 million passengers a year. It is the UK’s largest bus operator and also runs a rail freight business. In the US, it operates school transport for nearly four million students a day. The company is seeking to extend it operation in UK in the coming few years. There are challenges faced by the company in UK which need to be addressed. A key government policy affecting all transport services in UK relates to the reduction of CO2 emissions. The UK government has signed an international treaty the Kyoto Protocol. Countries which sign the agreement intend to reduce the emission of harmful gases. This can succeed only through partnership with business. A good example of this is the government initiative to encourage using bus services rather than traveling by car. This will help to reduce carbon emissions. High tax on fuel also encourages customers to switch from using cars to more economical bus and rail transport. Congestion charges in cities like London also encourage drivers to switch to other forms of transport. The company is also facing changes in demand for its services in UK market. Market research showed that parents and students wanted school buses analogous to US services. Parents see many benefits from such services provided. In particular, drivers are specifically trained to work with students. Each day students step onto the same bus, can take the same seat and are looked after by the same specially trained driver. Vehicle safety features include padded seating, integrated seat belts, additional escape hatches and CCTV. Meantime the UK population is ageing and the number of older people in the UK is rising. While many elderly people prefer to travel by bus because it is convenient and safe...
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