The main factor that affects most business is the degree of competition – how fiercely other businesses compete with the products that another business makes. The other factors that can affect the business are:
Social – how consumers, households and communities behave and their beliefs.
Legal – the way in which legislation in society affects the business.
Economic – how the economy affects a business in terms of taxation, government spending, general demand, interest rates, exchange rates and European and global economic factors.
Political – how changes in government policy might affect the business
Technological – how the rapid pace of change in production processes and product innovation affect a business.
Ethical – what is regarded as morally right or wrong for a business to do?
These factors have a marked up effect on the business and immediate changes are seen in the market if these factors are changed. The Markets keep changing all the time. It does depend on the type of product the business produces, however a business needs to react or lose customers. Though a business does not want competition from other businesses, inevitably most will face a degree of competition.
Social Environment and Responsibility
In a country like India when we discuss business environment; the social factors and their impact on business are given due consideration. The Social change is when the people in the community adjust their attitudes to the way they live. The business also needs to be aware of their social responsibilities. A lot of variables should be taken into account if one should decide to do a business in a certain location. One variable to consider is to what degree a social environment of the business is conducive to the business success. Business will accumulate wealth only if the business ecosystem supports the growth of business. One aspects of business ecosystem is the social environment.... [continues]
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