Chapter 1.6 - The external operating environment of a business Flashcards
What stakeholders are part of the external operating environment?
The stakeholders are customers, suppliers, competitors and interest groups.
Describe customers.
Customers are the people who buy the businesses products. They all have different opinions which affects the businesses profit.
Describe suppliers.
Suppliers are the organisations and individuals that supply the business with its stock and resources. It is wise to not have just one supplier as reliability is a huge key.
Describe competitors.
Competitors are the other businesses and organisations in the same market. Competition can result in more efficient service, with low prices and better quality products with competitors always keeping watch on each other.
Describe interest groups.
Interest groups are the institutions and group that attempt to persuade an organisation to change its policies. Three common groups are trade unions, consumer groups and specific issue groups.
What is the external operating environment?
The external operating environment is the people and groups outside of the business that have an interest in the business. These people are called stakeholders.
