Market environment
● Elements that are external to the business
● The business has no control over this environment, but can be affected by the market
environment, therefore the business has to:
Assess the extent these elements could impact the business
Put the necessary plans in place to deal with these external elements.
The following elements are found within the Market environment:
1. Suppliers 5. NGOs
2. Consumers 6. Industry regulators
3. Competition 7. Strategic alliances
4. intermediaries
Suppliers
Businesses depend on their suppliers, to be able to manufacture the products/ services they
are going to sell.
Materials must come in the right quantity, correct quality, fair price and are obtained at the
right time and place.
Building strong relationships between suppliers and the business is key to avoiding
disruption.
Suppliers do have some power over the business:
● If the supplier demands a higher price to sell their materials, it may result in the
business increasing its selling price.
● If materials are not delivered on time, it can result in the business not reaching its
objectives (loss of sales)
Consumers
People who buy and/ or use the products/ services of a business.
The business has to follow consumer trends to meet customer demands. When trends
change the business has to adapt/ redevelop the product to meet customer needs and
wants.
● Elements that are external to the business
● The business has no control over this environment, but can be affected by the market
environment, therefore the business has to:
Assess the extent these elements could impact the business
Put the necessary plans in place to deal with these external elements.
The following elements are found within the Market environment:
1. Suppliers 5. NGOs
2. Consumers 6. Industry regulators
3. Competition 7. Strategic alliances
4. intermediaries
Suppliers
Businesses depend on their suppliers, to be able to manufacture the products/ services they
are going to sell.
Materials must come in the right quantity, correct quality, fair price and are obtained at the
right time and place.
Building strong relationships between suppliers and the business is key to avoiding
disruption.
Suppliers do have some power over the business:
● If the supplier demands a higher price to sell their materials, it may result in the
business increasing its selling price.
● If materials are not delivered on time, it can result in the business not reaching its
objectives (loss of sales)
Consumers
People who buy and/ or use the products/ services of a business.
The business has to follow consumer trends to meet customer demands. When trends
change the business has to adapt/ redevelop the product to meet customer needs and
wants.
