internal/ external factors

• the external factors effecting a business are (PESTEC)

  P - political

  E - economic

  S - social

  T - technological

  E - environmental

  C - competitive
• Political factors - are largely concerned with taxation and new laws.

  • Governments can raise or lower the rate of corporation tax, which will affect profits. They can also affect businesses by increasing value-added tax on products or business rates.
  • Government can introduce new laws like the National Minimum Wage, which impacts on profits and employment rights.
  • Governments can also introduce new health and safety legislation meaning that a business has to change the way it works, for example by training its staff.
• Economic factors - are concerned with economic conditions, such as inflation, interest rates, and unemployment rates, can impact consumer spending power, business investments, and access to credit.

  • For example, if people have less money to spend during a period of economic recession, it may affect product sales.
• Social factors - are the things that influence the habits and spending of customers. These include lifestyles changes in fashion, and trends.

  • For example, a growing interest in fitness and healthy living might lead to increased demand for organic food products or gym memberships.
  • The influence of social media and online communities can significantly impact the success of a business.
• technology - These refer to the ways new practices and equipment can affect businesses. These include the changing nature of technology, research and development, automation and e-commerce.

  • For example, the introduction of automation in manufacturing processes can improve efficiency and reduce costs for businesses.
• environmental - These cover physical conditions such as climate change and weather. It also covers eco-friendly or ‘green’ objectives, eg, recycling and pollution. For example, growing awareness of environmental sustainability may drive consumers to favour eco-friendly businesses.
• competitive - These cover how businesses who offer similar products or services affect each other. This includes imitators, price wars and product differentiation. Businesses need to understand and respond to the competition to stay relevant.
• internal factors are factors within a business that can effect the businesses sucess
• the internal factors are; human resources, available technology, available finance
• avilable finance - Having enough funds is crucial for a business to survive and grow successfully. The amount of money available to a business affects its ability to invest in operations, research and development, marketing, and expansion.

  • For example, having sufficient financial resources allows a business to purchase necessary equipment, conduct market research, and advertise its products or services effectively.
• human resources - the people who work for a business, including employees, contractors and the self-employed. The quality and skills of employees are important for a business's success. Hiring and training talented workers, as well as keeping them engaged and motivated, contribute to productivity, innovation, and customer satisfaction.

  • For example, a company that invests in training programs can attract skilled employees.
  • A business also has to have access to a sufficient number of workers.
• available technology - The effective use of technology and information systems can enhance productivity and improve decision-making.

  • For example, using computer software to track inventory and sales can help businesses manage their stock and make informed purchasing decisions.
  • social mendia could be used to establish a close link to its customers and spread the world about its products
  • if a business does not upgread its hardware and software then they risk losing customers