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Boots Economic Conditions.

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Introduction

D3 : Boots Economic Conditions In this piece of work I am going to suggest and justify ways in which Boots could respond to the changes D2 in relation to economic conditions. Economic Conditions come under four areas: - 1. Inflation 2. Interest Rates 3. Exchange Rates 4. Government Policy I will start of by suggesting and justifying ways in which Boots could respond to Inflation. If Inflation rose Boots would start to loose money and their profits would go down along with their thousands and thousands of shares. To respond to Inflation rising Boots could do a number of things. Firstly Boot's could start new and more direct advertising campaigns to get more customers in. This would bring more customers in and more customers means more profit which would help Boots to deal with Inflation rising. If better more direct advertising campaigns didn't work Boots could try and increase the number of services (Cafes, More Wellbeing Services or Selling CD's, video's, video games) ...read more.

Middle

rising. Interest Rates(I.R.) rising would be a good thing for Boots as they would be bringing in more money and paying out less money. If Interest Rates (I.R.) rose Boots could completely pay of their mortgages on their stores and factories around the country. Boots could also pay of their loans on things like machinery and vehicles. This would benefit Boots because it would help them out in times on trouble e.g. Inflation Rising. If Interest Rates(I.R.) rose Boots could save more of their profits. This is because they would be getting a greater rate of interest on their profits which would increase them. This would increase their share prices because the market would see Boots have money to spare. Finally if Interest Rates(I.R.) rose Boots would have more money to spare so they could look at offering alternative services. This would benefit Boots because it would bring in more custom and interest into Boots, which would increase their profits. ...read more.

Conclusion

This would spread the Boots name and increase their profits and dividends for their shareholders, keeping everyone happy:). Finally I will suggest and justify ways in which Boots could respond to Government Policy. Government Policies mainly have a bad impact on Boots apart from when Boots are offered money to set up in areas on high unemployment. This benefits Boots because it spreads there name for a smaller amount of money and increases their profits. When Government Policies have a bad impact on Boot's profits, Boots are forced to find ways to bring more customers into their stores. Boots could try better, more direct advertising campaigns. This would bring in more custom which means profit and that is what Boots needs to respond to government policy. If that didn't work Boots could try putting special offers on which would bring more custom into the store and would make up for the profit lost by changes in government policy. By Paul Allen 10C ...read more.

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