BTEC BUSINESS UNIT 1 – THE BUSINESS ENVIRONMENT SANJANA SUNDEEP – 12 C
Task P5 - Describe the influence of
two contrasting economic
environments on business activities
within a selected organization.
1
, BTEC BUSINESS UNIT 1 – THE BUSINESS ENVIRONMENT SANJANA SUNDEEP – 12 C
The Impact of Economic Environment
on a Business
Introduction:
In this task I will be talking about the influence of two contrasting economic environments on
the business activities with an organization. The organizations that I have chosen for this task
are Siphen and ENOC. An IT Software company and an oil/gas company. This task will be about
how their economic environment influences the business activities in the company.
Economic Environment:
The economic environment is made up of external aspects that influence the business. The
basic economy consists of thousands of people that make choices, those who sell and purchase
products, loan and borrow money and raise taxes and change interest rates. For example: In
ENOC sometimes the customers or consumers are ready to spend extra money which in turn
helps ENOC increase their profits and supply of goods. From the company’s view point, these
are the most important decision makers:
Consumers – Those who buy the products and goods and expect their money’s worth.
Suppliers – Those who provide goods to businesses and customers that buy their
products.
Bankers and Lenders – Those who loan money to businesses for them to set up their
company and then return that money with interest.
Government – Those who set taxes and decide how much money each part of the
government must be spending.
Importance of Stability:
Stability is the skill of being able to survive impermanent issues such as lack of capital, loss of an
employee or the company, decrease in profits and sales etc. Financial stability aims to increase
profits. Investors, employees and lenders are ready to deal with steady businesses upon
promising terms. These terms allow for growth, more profits and stability. Stability is being able
to strike secure deals that the people you supply to will pay you back on the agreed price.
2
Task P5 - Describe the influence of
two contrasting economic
environments on business activities
within a selected organization.
1
, BTEC BUSINESS UNIT 1 – THE BUSINESS ENVIRONMENT SANJANA SUNDEEP – 12 C
The Impact of Economic Environment
on a Business
Introduction:
In this task I will be talking about the influence of two contrasting economic environments on
the business activities with an organization. The organizations that I have chosen for this task
are Siphen and ENOC. An IT Software company and an oil/gas company. This task will be about
how their economic environment influences the business activities in the company.
Economic Environment:
The economic environment is made up of external aspects that influence the business. The
basic economy consists of thousands of people that make choices, those who sell and purchase
products, loan and borrow money and raise taxes and change interest rates. For example: In
ENOC sometimes the customers or consumers are ready to spend extra money which in turn
helps ENOC increase their profits and supply of goods. From the company’s view point, these
are the most important decision makers:
Consumers – Those who buy the products and goods and expect their money’s worth.
Suppliers – Those who provide goods to businesses and customers that buy their
products.
Bankers and Lenders – Those who loan money to businesses for them to set up their
company and then return that money with interest.
Government – Those who set taxes and decide how much money each part of the
government must be spending.
Importance of Stability:
Stability is the skill of being able to survive impermanent issues such as lack of capital, loss of an
employee or the company, decrease in profits and sales etc. Financial stability aims to increase
profits. Investors, employees and lenders are ready to deal with steady businesses upon
promising terms. These terms allow for growth, more profits and stability. Stability is being able
to strike secure deals that the people you supply to will pay you back on the agreed price.
2
