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In task D3 I will be suggesting and justifying ways in which my two chosen businesses Ikea and Richards Paints could respond to changes in external influences.

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Introduction

Task D3 In task D3 I will be suggesting and justifying ways in which my two chosen businesses Ikea and Richards Paints could respond to changes in external influences. Ikea Competitors If there are new competitors close to Ikea, Ikea will then have to carry out changes to their business to maintain their customer levels. If former customers of Ikea choose to shop at new competitors instead of Ikea, Ikea could produce special offers on certain products, for example buy one get one free or even lower prices or sales. If prices are lower this will attract former customers of Ikea to go back to their store a purchase their product. Ikea could also advertise their products in leaflets, on the radio and on the television. If more customers know about the store and what they sell, they are more likely to go to the store and purchase products. If customers are more likely to purchase products then the competitors will be out of business. If most of Ikeas customers are going to their competitors it may be because of the quality of products. If Ikea improve the quality of their products or produce better products then their customers may return. If customer services aren't good then their customers may go to their competitors. If Ikea wants their customers back they should train their staff so their customer services are back up to scratch. Even though the training will cost a lot it will make more money in the long run if customers come back. ...read more.

Middle

If this occurs Ikea could rise prices or produce more expensive products to sell. Nevertheless high levels of unemployment or not good occupation situations is a bad thing for Ikea because if more of Ikeas customers have no jobs or bad occupations will mean customers they will have less money to spend on products , so will spend the money they do have of necessities like food. For this reason Ikea may need to introduce lower prices, sales or introduce a buy now pay later policy or Ikea could introduce the same kind of products but use cheaper materials so it will cost less to manufacture and will be less to buy. Environmental constraints If there is a new act of parliament (law) about the amount of waste you can produce or the amount of recycling you must do Ikea will be affected. The affect of this is not good for Ikea because Ikea would then have to pay a firm to dispose of the excess waste by recycling. This will cost Ikea dearly because they have many outlets which will need this service. If there is new act of parliament (law) about the amount of vehicles on the road or the type of fuel used to power vehicles which include liquid patrolmen gas or electricity. Ikea will be affected by this because they have many delivery tucks around the world so may need to change the fuels they use which may be much more expensive, so Ikea will have less money to spend on improvements or designing new products. ...read more.

Conclusion

If income taxes fall this will mean many customers will have more money to spend, which means more profit. However if income taxes raise many customers will not be able to afford to buy industrial paint. Richards's paints could lower prices which will mean less profit but could mean more customers. Cooperation tax affects Richards Paints; this can be good or bad. If Cooperation tax raises Richards paints must pay more money to the council from their profit which means less money for improvements. However if Cooperation tax falls Richards paints must then pay less money to the council. Unemployment or occupation does not affect Richards Paints because other companies buy the industrial paint and not the public so can afford to pay for paint. Environmental constraints If there is a new act of parliament (law) about the amount of waste you can produce or the amount of recycling you must do Richards Paints produce a lot of waste but is not really affect because they already recycle their waste. If there is new act of parliament (law) about the amount of vehicles on the road or the type of fuel used to power vehicles which include liquid patrolmen gas or electricity. Richards paints could also use fewer delivery trucks, but this will mean less business. If there is new act of parliament (law) about the hours you can use noisy machinery, this will affect Ikea. Richards Paints will be affected because they would have to limit the amount of paint they make which will lead to loss of profit. Laura Tomlin 10BD Unit 1 - Assessment Investigating Businesses ...read more.

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