Unit 1.3 Operating within an External Environment

What is the external environment?

The externam environmenr of an organisation are those factors outside the company that affect the company's ability to function. Some external elements can be manipulated by company marketing, while others require the organisation to make adjustments. 

External factors

• Competition
• Changes in incomes
• Changes in interest rates
• Demographic factors
• Environmental issues and fair trade
• Market conditions

Competition

The tighter the economic and market conditions, the greater the copetitive pressures. In business, a company in the same industry or a similar industry which offers a similar product or service. The presence of one or more competitors can reduce the prices of goods and services as the companies attempt to gain a larger market share. Competition also requires companies to become more efficient in order to…