External environment MACRO ENVIRONMENT What does the Macro

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External environment MACRO ENVIRONMENT

External environment MACRO ENVIRONMENT

What does the Macro Environment entail As known as the external environment Consists of

What does the Macro Environment entail As known as the external environment Consists of seven aspects: Natural / Physical environment Economic environment Social, cultural and demographic environment Technological environment Political / legal environment Global environment Institutional environment

Natural Environment The natural environments consists of: Physical location Natural resources Infrastructure Environmental awareness

Natural Environment The natural environments consists of: Physical location Natural resources Infrastructure Environmental awareness Business need natural resources and infrastructure for there business. They need to use the resource sparingly and prevent wastage.

Economic environment This environment includes all financial factors that affects the business. It affects

Economic environment This environment includes all financial factors that affects the business. It affects the cost of inputs (raw materials) and the price of goods and services. Large effect on consumer buying power and spending.

Social, cultural and demographic environment They affect the business They influence consumer behaviour and

Social, cultural and demographic environment They affect the business They influence consumer behaviour and the workforce. Many business have corporate social responsibility programmes. Study of population- size, location and age.

Technological environment This environment includes all changes and developments in product, method, systems and

Technological environment This environment includes all changes and developments in product, method, systems and resources. Technology makes business practices more efficient and reliable and saves on costs and time. Business need to stay up-to –date and be aware of new trends.

Political / legal environment The legal environment deals with all the laws and regulations

Political / legal environment The legal environment deals with all the laws and regulations which control business operations. The political environment, the government plays a large role in the development of policies and laws. The government itself is also a supplier and consumer and often acts as the regulator (that uses laws as a control mechanism)

Global environment The international environment provides opportunities and threats for the business. Quick and

Global environment The international environment provides opportunities and threats for the business. Quick and fast access to the world and making international trade possible. Globalisation – strengthening of communication, and interdependence of markets throughout the world

Institutional environment The government acts as a consumer, an employer a suppliers and regulator.

Institutional environment The government acts as a consumer, an employer a suppliers and regulator. The government affects business practice. Laws and regulations have been put in place to ensure that there is a framework of legal systems for international trade. Exports and Imports

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