Explain how external and internal influences
Title: Explain how external and internal influences may impact on business opportunities in Australia. Purpose: Explaining how external and internal influences may impact on opportunities businesses have in Australia. Introduction: External influences such as Financial, geographic, social, economic and competitive situation are all influences that impact business opportunities in Australia. Internal influences such as products, locations, resources and management are also factors that contribute to business opportunities in Australia.
These influences can affect a usiness dramatically, the external influences are harder for a business to change as they are influences that a business itself cannot change, internal influences are easier for a business to change. External influences: Financial influences can impact on businesses as they are always changing and are very unsustainable. With interest rates and access of loans constantly changing it is hard to stay financially stable.
Geographical Influences have large impacts on business activity as the geographical location can change factors and lead to changes in the nature of product and service. Social influences can affect the business if it doesn’t respond to changes in taste, fashion and culture and can lead to a decline in sales. If the business responds to changes in fashion and culture the sales will increase. If a decline in sales occurs is may cause threat to the businesses stability & visibility.
Economical influences can affect the business with the economic cycles changing from boom to recession. Competitive situation can affect the business depending on the number of competitors and the size of competitors. External influences are influences, which highly impact on the business opportunities in Australia, as businesses themselves cannot change external influences. An example of an external influence is Myer excepting a lower net profit, as they are losing up to 5% of their profits to other competing stores, especially now to internet shopping.
This could be helped by Myer introducing online shopping to its customers, and discounts when they use the online accounts. Internal influences: Products influences business opportunities in the way they provide a variety of products for consumers to buy. If people don’t like the products they will not business opportunities as if your business is located in a poor area you might not get h customer satisfaction you want. If your business does not have good management and resources is will struggle in up holding good business quality.
An example of an internal influence is that a corner store in the middle of a bush wouldn’t do as well as a corner store on a busy street in the city as less customers would be walking past a bush on a daily basis. Conclusion: Internal and external influences impact on business opportunities in many different ways, the NSW Government has seen the need that growth and support in businesses in NSW is necessary for a business to economical grow.