2. External Influences Flashcards
Term 2 Miss Blackwell (STEEPLE - economic)
What are the STEEPLE factors?
Factors that are changing in the external environment
What does STEEPLE stand for?
Social Technological Environmental Economical Political Legal Ethical
What is the European Union?
The economic and political union of most European states aimed at harmonising economic policy.
What are the 3 biggest economic contributors to the EU?
UK, France and Germany
What is the Eurozone?
The countries in the EU that are now using the euro as their currency
What is the European single market?
The EU is one territory without any internal barriers to the free movement of goods and services
How has the European single market fuelled economic growth?
Competition and international trade have been stimulated
Improved efficiency
Increased quality, reduced prices
What are the 4 freedoms of the European single market?
- Free movement of goods
- Free movement of services
- Mobility of labour
- Free movement of capital
What is meant by free trade?
The agreement between countries to trade with each other without erecting barriers to trade
What are the barriers to trade?
Tariffs and quotas
What is a tariff?
A duty paid on imports
What is a quota?
A quota imposes a limit on the quantity of a good that can be imported into a country in a given period of time
What are the advantages of remaining in the EU?
+ Improved productivity (competition)
+ EOS (access to 500m customers)
+ Business alliances and joint ventures
What are the disadvantages of remaining in the EU?
- No greater demand from domestic customers
- Must follow regulations
What are the advantages of leaving the EU?
+ Greater demand
+ Greater freedom (do not have to abide to laws)
+ Reduced costs (EU laws are expensive to abide to)
What are the disadvantages of leaving the EU?
- Reduced pool of candidates
Why might UK businesses see greater demand if we left the EU?
UK customers will have to pay tariffs if they are to buy from Europe - greater domestic demand
How does political uncertainty impact businesses?
Consumer confidence is damaged which impacts business sales
May lead to pauses/cancellations of investment
Demographics
The characteristics of human population groups
e.g. the size of the population
Ethnic diversity
A diverse group of people are moving to the UK and so there are many cultures
What are examples of changing social factors? (6)
- Social habits - e.g eating out more
- Employment patterns - e.g part time
- Role of women
- Attitudes to work - holidays expected
- Education
- The grey pound (retired people - wealthier)
Ethics
Ethics concerns the judgement about whether something is morally right or wrong
Give 4 examples of ethical issues?
Zero hour contracts
Cancer treatment costing £500,000
Child labour
Unpleasant images on adverts
What are the benefits of behaving ethically?
\+ Attracts new customers \+ Attracts new and better quality employees \+ Encourages investment \+ Creates positive publicity \+ Encourages employees to stay \+ Results in increased sales
