Impact of Economic Factors on Business

The video discusses the dynamic nature of the business environment, focusing on external factors like technology, economy, legislation, and the environment. It highlights how these factors influence business decisions and strategies. Technological advancements have led to changes in marketing and distribution, while economic conditions like low interest rates and a weak pound affect expansion and pricing strategies. Legislative changes, such as Brexit and potential wage increases, prompt businesses to adapt their operations. Environmental awareness drives companies to consider sustainable practices and ethical sourcing.

What are the four key external factors affecting businesses?

• Technology, Economy, Legislation, Environment

• Technology, Economy, Legislation, Marketing

• Technology, Economy, Marketing, Environment

• Technology, Finance, Legislation, Environment

How has the advancement of technology influenced business marketing strategies?

• Increased physical outlets

• Reduced e-commerce outlets

• Altered marketing mix, especially distribution channels

• Decreased direct sales

What has been a significant result of ultra-low interest rates in the economy?

• Decreased market development

• Higher export prices

• Cheaper finance for businesses

• Increased labor costs

How does a weak pound affect UK exports?

• Has no effect

• Increases production costs

• Makes them more expensive

• Makes them cheaper in international markets

What was one of the business reactions to the Brexit vote?

• Shift from Just In Time to Just In Case operations

• Increased reliance on Just In Time operations

• Decreased labor costs

• Increased physical outlets

What could be a consequence of increasing the minimum wage?

• Lower labor costs

• Increased use of automation

• Decreased production

• Higher interest rates

Why are businesses changing their production processes in response to environmental concerns?

• To meet consumer demand for eco-friendly practices

• To decrease labor costs

• To reduce costs

• To increase production speed

What should businesses consider regarding their procurement departments due to environmental concerns?

• Cost of raw materials

• Ethical sourcing of materials

• Speed of delivery

• Quantity of materials

What is the main theme of the dynamic nature of business?

• Static business environment

• Constantly changing business environment

• Stable economic conditions

• Decreasing business opportunities

How can businesses succeed in a dynamic business environment?

• By maintaining traditional practices

• By ignoring external factors

• By reacting and adapting to external changes

• By reducing innovation