Internal & Extrenal Factors Flashcards

1
Q

Lots 3 internal factors that can affect a business

FEMIT

A

Finance
Employee
Management

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2
Q

Describe the impact of finance on a business

A

May force the business to look at new more evonimal ways to structure their business

  • cost cutting measures
  • de layering
  • reduction in product development
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3
Q

Describe the impact of employees on a business

A

If staff do not have expertise or the training and skills then they will have a negative impact on businesses profits and customer satisfaction

Also be demotivated, absenteeism, turnover

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4
Q

Describe the impact of management on a business

A

Good managers make good decisions and are able to lead and motivate staff to achieve organisational objectives

Poor managers may make decisions that have devastating effects in the business l

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5
Q

List 4 external factors that can influence a business

A
Political
Economic
Social trends
Technology
Environmental
Competition
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6
Q

Describe the impact of politics on a business

A

Influences the laws and policies a business must follow.

Impact:
Businesses will need to implement government policies.
E.g minimum wage

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7
Q

Describe the impact of economics on a business

A

Strong:
Business will be able to sell more products

Weak:
Business will find it difficult to sell more

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8
Q

What are the main economic impacts that affect a business m

A

Business cycle (booms and recessions)

Interest rates

Currency exchange

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9
Q

Describe the impact of social trends on a business

A

Business will need to invest in good information and research to ensure it is aware of to changing trends.

May need to invest in product development to keep up to date with trends

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10
Q

Describe the impact of competition on a business

A

If rivals have better products, prices and promotions they can steal potential customers.

To respond to this business needs to be able to compete with another business for market share.

Investments in, advertising, product development etc

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