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Ethics + External Environment 10 Mark Question

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Introduction

Transfer-Encoding: chunked ´╗┐External Environment 10 Mark Question (January 2011) Given Context Leo Springer has been designing and making office furniture ever since he left college 10 year ago. He started by making desks for people to have in their office/ study at home. Interest grew in his business and he was regularly called into other businesses to design the layout o their offices and then make the furniture. He currently sells the furniture abroad, as well as in the UK. He has always run the business as a sole trader and it operates under the name Springer Office Furniture (SOF). Leo now employs staff to make the furniture and to manage the various functional areas within the business. ...read more.

Middle

More people are working from home and they may have more money to spend and so may want to set up a good office at home and so there may be an increase in the amount of furniture ordered. Paragraph 2 (analysis of new competitor) We don?t know about SOF?s competitors but if there are more businesses doing the same thing in the area then SOF may see a decrease in sales. They may have to change their prices or improve their quality so as not to lose out to these competitors Conclusion I think the biggest impact will come from a new competitor entering the market because SOF sell most of its furniture to businesses rather than consumers so a change in the level of consumer spending would have less of an impact. ...read more.

Conclusion

This might result in a loss of many customers who would not want to be associated with an unethical company. This will result in a loss of profit for Nike. However some customers might not care about Nike?s ethical behaviour. Another possible consequence is that the workers at Nike?s factory might feel under- valued due to Nike?s lack of ethics. This could lead to de-motivation which could negatively affect the amount of output as well as its quality. This reduction of output would increase Nike?s costs and therefore reduce profits. However there might not be many jobs in Indonesia so the workers may be forced to work hard. Modern society is increasingly ethical and consumers are conscious of the types of companies they associate with. Therefore a negative public image resulting from Nike not behaving ethically would have major negative consequences for Nike. ...read more.

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