Outside influences on a business Edexcel International GCSE Business revision
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In plain words
A business can control its own prices, products and staff. It cannot control the world around it: what people want, what technology makes possible, what governments decide, or what happens to the climate.
These outside influences bring new openings and new dangers, and a business has to keep watching all of them.
5 things to know
- Social factors: changes in population, lifestyles, tastes and attitudes, such as an ageing population or a growing interest in health.
- Technological factors: new products, new ways of producing, and the internet, which change what can be made and how it is sold.
- Environmental factors: climate change, pollution and customers' concern for the environment, which lead to new laws and new demands.
- Political factors: government policies, laws, taxes and trade agreements, and how stable the country is.
- The same change can be an opportunity for one business and a threat to another.
Tips and tricks
- Classify the change first, then give its effect. A new law is political. A new invention is technological.
- Always state whether the factor is an opportunity or a threat for the particular business in the question, and why.
It lands in your notebook with its questions as flashcards.
Outside influences on a business: 5 questions and answers
These are the quiz’s questions. Do the quiz first, then come back here for the ones that got you.
A government introduces a new law on minimum pay. Which kind of external factor is this?
It comes from government policy and law.
More people are choosing to shop online. This is mainly a result of which factors?
The technology exists, and habits have changed with it.
An ageing population is an example of
It is a change in the make-up of society.
Which statement about external factors is correct?
They come from outside, and can be opportunities too.
Consumers begin to avoid products with plastic packaging. For a maker of paper packaging this is
Demand moves towards what it sells.
Quiz
5 questions
Tap an answer and you’ll see straight away whether it’s right, and why.
Worksheet
3 questions, 8 marks. Write your answers on paper, then check them.
Outside influences on a business
Edexcel International GCSE Business 4BS1 · 8 marks · papermunch.org
Name ______________________________ Date ______________
State two external factors that can affect a business.[2]
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Any two of: social, technological, environmental and political factors.
Explain how a social change could be an opportunity for a food business.[3]
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If more people want to eat healthily, there is a growing demand for low-sugar and fresh foods. A business that brings out healthier products can win new customers and increase its sales.
Explain how a technological change could threaten a business.[3]
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A competitor may use new technology to make a better product or to produce more cheaply. A business that does not keep up loses customers, or has to invest heavily to catch up.
Answers: Outside influences on a business
- 1. Any two of: social, technological, environmental and political factors.
- 2. If more people want to eat healthily, there is a growing demand for low-sugar and fresh foods. A business that brings out healthier products can win new customers and increase its sales.
- 3. A competitor may use new technology to make a better product or to produce more cheaply. A business that does not keep up loses customers, or has to invest heavily to catch up.