1.5 Understanding external inlfuences on business

• stakeholders - people who have an interest in the business and its success
• internal stakeholders - people that work inside the business itself: empolyees, suppliers, managers and owners.
• external stakeholders - people outside the business who have an interest in the business: suppliers, community, government, customers.
• conflicts between shareholders can occur when spliting profits. e.g., empoyees want a larger wage when shareholders want more profit for the business.
• technology in business, Digital Communication - used to communicate to customers using text, email and video.
• Legislation - law made by a government or other body of authority.
• legislation is used to protect consumers, employees and businesses
• higher unemployment means people have less disposable income meaning they wont be able to afford expensive products.
• Inflation is the general rise in the price level of goods and services over time.
• the target for annual inflation is 2%.
• If inflation rates go up it means customers have less disposable income as the cost of living is higher
• Economic Climate - The economic situation of a country or region, especially as regards the state of its industry and trade.
• Exchange rates - The rate at which one currency is exchanged for another.
• If the pound gets stronger the exports are expensive but imports are cheaper.
• if the pound gets weaker exports are cheaper and imports are more exepensive.