Chapter 1 - Business Summary

CHAPTER 1 – BUSINESS ENVIRONMENTS


1) MACRO ENVIRONMENT

No control over but must design strategies to adapt to situations in the external
environment. The business needs to eliminate any threats and capitalize on opportunities

Tools used:

 Environmental Scan
 O + T of SWOT
 PEESTLE SO WHAT + HOW TO…

1) Environmental Scan


To identify factors that may have an impact on the business, then adjusting existing plans to
deal with these factors


2) PEESTLE ANALYSIS



SO WHAT + HOW TO…
Political Factors



Environmental Economic
Factors Factors




PESTLE
Analysi
s
Legal Factors Ethical Factors




Technoloigcal
factors Social Factors

, 2) MARKET ENVIRONMENT

Any place where goods and services are bought and sold



Tools used:

 Environmental Scan
 O + T of SWOT
 PORTERS 6 Forces
SO WHAT + HOW TO…

1) Porters 6 Forces


The 6 Forces


SO WHAT + HOW TO…


threat of
new
competitors
impact of Rivalry with
complementary current
products competitors


PORTERS 6
FORCES
MODEL
threat of
substitute
power of buyer
products



power of suppliers

1.THREAT OF NEW COMPETITORS

Assesses how easy or difficult it will be for a new competitor to enter into the current
market based on the barriers in place. Existing businesses need to create high entry-level
barriers to the market to stop new competitors.