Business coursework 3a
A factor that affects a business is a trend or any other thing that has
an impact on a business. There are 2 types of factors that can
impact a businesses’ proposition. These are known as local and
national factors. Local factors are the elements used to calculate
local adjustments to performance standards. These are impacted
within a local or a small area and include demographics: where you
base your business is dictated by the type of people who will be your
nearest potential customers. Competitors: on one hand there is the
danger that you will lose customers to your rivals, especially if they
outdo you on price or have other benefits. On the other hand, you
might benefit from customers looking to visit multiple businesses
easily. Accessibility: Location plays a huge role in attracting and
keeping employees and customers. Good location decisions can
significantly boost a company's long-term performance as well as
success. Workforce: examining where staff can easily get to work, as
this can range, such as academic achievement and subject expertise
among skilled employees. By grouping some of the factors with
competitors, businesses can gain competitive insight. Depending on
the competitors´ success, strategists could estimate if their
competitors are struggling to maintain their territory.
National factors are known to be similar to local factors, except by
larger scale. Examples of this include, level of unemployment,
government support, taxation… etc the level of employment in the
UK is currently 7.7%. This can affect a business in many ways. One
effect of this is that unemployed members of the public will have
less money, so businesses may have to lower their prices to adjust.
However, a positive side to unemployment is that having less
employees means that a business would have more money to keep
to themselves. The government provides support to businesses both
financially, in the form of grants, and through access to expert
advice, information and services. Companies could end up
unsuccessful, so the government only does this if it seems profitable
to them. Taxation is a process in which governments influence
businesses' financial decisions. The poorer the economy, the higher
the tax, and the higher the tax the more businesses will lower their
prices. There are also internal and external factors such as
employees, competitors, customers, suppliers which take a role in
impacting a businesses’ proposition. The product, price, promotion
and place of a business influences the behaviours of its target
market.
There are multiple supports given to start-up businesses by the
government. One of these supports are grants. Grants are a sum of
, money from the government which don’t have to be paid back. This
helps the business as it lowers their costs and reduces the pressure
of having to make the money, which is loaned to them, back under a
certain period of time. Another way which the government helps
start-up businesses with is by providing customer and market
research to help businesses learn about crucial information for
things such as the market their going into or about their potential
customers. Subsidies are a form of financial aid or support with the
aim to remove burden off a business and is often considered to be in
overall interest to the public and to promote social good or an
economic policy. Although they are mostly provided by the
government, these can also come from other places for example,
from NGOs also known to be non- government organisations.
Additionally, subsidies are useful because they encourage an
increase in competition and decreased prices which is good for
customers, aside from providing small businesses with the money
needed to invest and expand.
There are many types of financing that small businesses can access.
One example of this would be funding from personal savings. Many
business owners turn to use their own funds to finance their
business when they are struggling. This can be extremely helpful
when first starting up a business, as they are relying on themselves
and won’t have to pay back any debt. The Prince's Trust is an
enterprise programme which offers loans, training and mentoring to
16–30-year old's who have experienced difficulties at school, have
been in trouble with the law, are long-term unemployed or have
been in care, start their own businesses. This provides
financial help and business support for young entrepreneurs in
England, Scotland, Wales and Northern Ireland. Similarly, when
businesses get involved with charities, they gain access to new and
interesting networks with complementary skills, experience and
contacts for them to benefit from. The exchange can be a mutually
beneficial and make new opportunities for projects to occur.
Grants allow new businesses to not have to worry about making the
money back as quickly as they would have to with normal loans,
otherwise the interests would increase. This allows the business to
comfortably settle and start operating as they are starting their
company and relieves their stress. One of my other examples is
customer and market research. This is when the government gives a
business free customer and market research on the particular
segment of the market, they are in which will increase their
knowledge on their possible customers’ needs and wants. This
research can be extremely helpful and will lead to the business
being able to apply this knowledge to increase customer
