The External Environment and Its Effect on Business

Topics: Pollution, SWOT analysis, Law Pages: 3 (1481 words) Published: September 23, 2014
The external environment in which businesses operate can have a significant effect on their success. To what extent do you think that the external environment in the UK is favourable for businesses at the moment? Justify your answer with reference to external factors and/or businesses that you know. (40 marks) You must include a plan. 3 ½ pages handwritten.

Not petrol?
Can argue against in evaluation – favourable for some industries but not others Make a point, explain and evaluate (3-4 main points)

The external environment for a business is equally as important to its success (or otherwise) as it’s internal environment. This is because external factors will directly impact on the business. These factors are complex and wide ranging so many businesses analyse them in a similar way to a SWOT analysis. A common tool that is used to analyse and document the external environment is the PESTLE analysis. (There are other similar models) PESTLE involves identifying the political, economic, social, technological, legal and environmental factors in the external environment that could impact on the business. This information can then used to assess the company’s current position within the market.

I plan to look at each of these areas in turn. Since these 6 factors will be impacting different businesses in different ways at the moment, for the purpose of this essay I will consider them from the point of view of Cadbury in the UK

The current Political environment is one of the most important factors that a business needs to be aware of. Considerations include issues such as government stability and likely changes, tax policy, trade control, import/export restrictions, competition regulation, discrimination law, copyright, patents and IP law, laws regarding employment, health and safety and data protection and, increasingly, laws regulating environmental pollution. In recent years the high company tax regime in the UK has led to Companies like Cadbury moving...
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