The external factors affecting business decisions Flashcards
What are the four main external factors affecting business decisions?
Social, Technological, Environmental, and Political factors (STEP).
How do social factors affect business decisions?
Changes in population, lifestyle, and customer preferences impact demand and marketing.
Give an example of a social factor affecting businesses.
An aging population increases demand for healthcare and retirement services.
How do technological factors affect business decisions?
Advances in technology improve efficiency, reduce costs, and create new products and markets.
Give an example of a technological factor affecting businesses.
E-commerce growth forces traditional retailers to sell online to stay competitive.
How do environmental factors affect business decisions?
Businesses must consider sustainability, pollution control, and climate change impacts.
Give an example of an environmental factor affecting businesses.
Companies invest in eco-friendly packaging due to consumer demand for sustainability.
How do political factors affect business decisions?
Government policies, trade agreements, and regulations impact business operations
Give an example of a political factor affecting businesses.
Brexit affected UK businesses by changing trade agreements and tariffs.
