Economic factors The state of the economy directly affects the performance of

Economic factors the state of the economy directly

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to expand its operations and venture into more areas of e-commerce. Economic factors The state of the economy directly affects the performance of the business because it affects the rate of consumption of goods by the public. Growth in the marketplace is translated into increased disposable income. Increased disposable income, especially in developing countries, results in increased purchasing power. Amazon is expanding to the developing countries, and the economic stability of the countries is crucial for its performance. Over the years, China has been experiencing economic growth, which has attracted many international businesses. However, in recent years, China has been experiencing a recession in the growth of its economy. Amazon has invested a lot in its bid to penetrate the vast market in China. The future growth
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of the economy in China is unpredictable, especially after the outbreak of the Coronavirus, which has resulted in the isolation of the region. The growth of the economy has, therefore, been threatened by the epidemic. The economic recession in China will, therefore, negatively affect the growth of Amazon. Social factors Trends in society affect the consumption of goods and, consequently, the performance of the business. Culture is dynamic and is influenced by current trends in society. For instance, there has been an increase in online buying over the last few years. People have moved away from window shopping and are now dependent on the internet for the purchase of all commodities. The trend is not only in the developed countries but is also picking pace in the developing countries, therefore, creating more potential markets for Amazon. Increased consumer awareness in developing countries has resulted in increased online shopping. In developing countries, markets are flooded with fake cheap products. Over time, people have embraced the need for the use of genuine products and are now turning to big companies for shopping. Amazon has established itself as a company concerned with customer satisfaction, and people are, therefore, likely to turn to Amazon for the purchase of genuine goods. Increased consumerism is, therefore, an opportunity for Amazon to expand in developing countries. Technological factors Amazon is highly dependent on technology for its operations. Changes in technology directly affect the operations of the business. Technological obsolescence results from rapid technological changes.
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