BUSINESS ENVIRONMENT
Business Environment mainly refers to external forces that impact business. Such forces include political-legal ,technological ,cultural ,economic and physical.
Factors under External Environment
All the factors that provides opportunities or pose threats to an organization make up its external environment.
? DEMOGRAPHIC ENVIRONMENT
? SOCIAL ENVIRONMENT
? CULTURAL ENVIRONMENT
? POLITICAL ENVIRONMENT
? ECONOMIC ENVIRONMENT
? FINANCIAL ENVIRONMENT
? TRADE ENVIRONMENT
? TECHNOLOGICAL ENVIRONMENT
? LEGAL ENVIRONMENT
? REGULATORY ENVIRONMENT
? TAX ENVIRONMENT
? ETHICAL ENVIRONMENT
External environment consists of 1. Micro Environment 2. Macro Environment
1. Micro Environment
? Micro environment is called as the task environment and operating environment.
? Micro environment forces have a direct bearing of the operation of the firm.
? These factors are present in companies environment and affect on the performance of the companies.
? Includes ? suppliers ,marketing intermediaries .competitors,customers and public.
Micro environment are more intimately linked to company than macro.
? Suppliers :
o Those who supply inputs,raw material and components
o Uncertainty in supply compels high inventory cost.
o India maintains stocks of 3 to 4 months were as Japan maintains for few hours.
o Eg : Nirma ?believes of the logic that captive production plant for raw material is best for cost control.(backward integration)
o Co feel outsourcing is more beneficial
o Risk to depend on single supplier
o Globally companies are resorting to partenering relationship marketing.
? Customers:
o Business exists becau ...