BUS101_topic1

Business environment think of a business you would

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Business Environment Think of a business you would like to start. There's more to it than just a good idea and determination. Your business would not exist in an isolated glass bubble; rather, the surrounding environment will influence your ability to succeed in this business. The business environment is affected by several different but interrelated elements. These elements can either encourage or discourage the development of businesses. Do this short exercise to find out more about the business environment. Elements of the Business Environment This notion of supply and demand is an important one in business and is related to competition. Also involved in business are stakeholders (Bankers, Stockholders, Customers, Surrounding community, Environmentalists, Dealers (retailers), Employees, Government Leaders, Suppliers) These are not just the owners and investors, but also include customers, banks, and communities surrounding a business. The trick is for business leaders to find a balance between the needs of the various stakeholders and still turn a profit. Sometimes achieving this balance can be tricky indeed! Five Factors in the Business Environment The following five environmental factors influence the capability of a business to grow and create jobs. 1. Economic environment - influences your risk, either increasing or decreasing it. 2. Legal environment - affects whether and how you can sell products, and the degree to which your doing so is regulated and taxed by the government. 3. Technology environment - adapting to it will be crucial part of your business management. Technology can increase productivity, adaptability and responsiveness to your consumers. 4. Competitive environment - achieved in various ways. You can focus on the product quality, speed of delivery, lower cost, or efficiency of production. 5. Social environment - influences the success of your business in terms of demographics and social responsibility. As the population changes, so too can the product demand as well as ability of workers for production. Environment in the Workplace - Diversity Managing diversity in the work place is essential. A business must be attentive to the needs of its workers including sensitivity to race, gender, and age. Additionally, an ethical approach is required for consumer trust. The reputation of your business hinges not just on your profits and product quality, but on your concern for the welfare of others. Risk in Relation to Profit and Loss Business, by necessity, involves balancing risk and profit. There is no guarantee that a business will be profitable. If you are to be a businessperson, you will make profits by taking risks. Risk is the chance you take, as an entrepreneur, of losing time and money on your business if it is not profitable. You must balance your risk with your revenue and your potential profit. Revenue is the amount a business takes in during a period of time of selling its goods and services. Risk in Re...
View Full Document

This note was uploaded on 09/30/2013 for the course BUS 101 taught by Professor All during the Winter '07 term at SUNY Buffalo.

Ask a homework question - tutors are online