Changes+in+the+Business+Environment

__**Topic 7 - Changes in the Business Environment **__

The current events which are helping the business are cutting down the cell sizes and the prisoners are sharing cells instead of having one large cell to themselves. They are also doing race relations policy to make sure that no matter the colour or the religon of the prisoners everyone is equal and no-one is better than any-one.

The choices that the Scottish Prison Service have had to make are making the prisoners share cells and hope that no-one gets hurt and that the cell-mates get along. Another choice that they had to make would have been splitting up the young offenders from the older prisoners so that the young ones don’t get ideas from the older prisoners. And aslo splitting up the women prisoners from the men prisoners. Which all were good ideas they prevented many fights and stopped a lot of things from happening.

**__ External :- __**

Some of the External factors are :-

§ Overdraft – An overdraft is a short term solution at the bank to overdraw on your own account.

§ Trade Credit – A Trade Credit gives you time to pay your suppliers and allows you to get back some money so you don’t go bankrupt.

§ Hire Purchase - A Hire Purchase is often used to obtain equipment or vechiles. The cost plus interest is paid in equal instalments over a set period of time.  § You can increase the amount of money invested in the business/ capitol by the owners/shareholders. This is also good because you don’t have to pay back any of the money that you take altohugh there is a certain amount of money you can take. This is a long term solution.

§ You can also get a Bank Loan/Mortagages the payment that you have to payback are easiers because you are given regular fixed installments. This is also a long term solution.

§ Venture Capital – is someone who may be interested in your business and will often provide finance when banks decide that your business is too risky. And venture capitolists take on more risky businesses if they think they are successful enough.


 * __ Internal :- __**

Some of the internal factors are :-

<span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ Retained Profits - This is when a business saves a portion of its profits and reinvests back into the company. This is a good thing because the owner can control the profits although this can be risky.

<span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§  Leasing – The business could rent out some vehicles or equipment from a leasing company. This could be used to avoid using up limited finance on anoutright purchase. Leased equipment can be changed when obsolete.

<span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ Owners savings – this could reduce the amount to be borrowed if funds are needed. It allows the owners to keep control without bringing in others. Although it can be difficult to withdraw and the owners capitol is at risk if the business fails, only if the owner has unlimited liability.

<span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__P – Political Factors -__**UK and EU laws and political decisions affect every business in the UK. An example would be that the government have banned advertising tobacco on television and disallow shops to sell alcohol on a Sunday moring. Businesses must comply with the laws or face a heavy penalty. <span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__E – Economic Factors –__** Infaltion, exchange rates and interest rates all affect businesses. If the interest rate is high, the cost of borrowing for expansion is high. If there is a recession then the unemployment rises and the consumers have less income. <span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__S-Social Factors-__** Demographic changes are movements in the size and distribution of the population the flowing demographic shows changes that have taken place over a period of time. <span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__T-Technological Factors-__** firms must keep up with new technology or face losing customers, sales and profits. Some businesses also use new technology to reduce costs in production <span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__E-Environmental Factors-__**they could include storms,floods,pollution or noise. Some businesses have been severly effected by flooding in recent years and have had to close and refurbish. This is an environmental event over which they have little control. <span style="font-family: Wingdings; mso-bidi-font-family: Wingdings; mso-fareast-font-family: Wingdings; msobidifontfamily: Wingdings; msofareastfontfamily: Wingdings; msolist: Ignore;">§ **__C-Competitive Factors-__** most businesses face domestic and foreign competition that has an influence on the way they operate. for example littlewoods Football Pools was effected when the national lottery was introduced, so they had to alter its selling and promotional techniques.
 * __ PESTEC  __**

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