Market information based on a Petrol Organisation.

Authors Avatar by mlaher (student)

P5:

An economy consists of a wide range of individual decision makers that tend to buy and sell goods, borrow and lend cash as well as raise taxes and changing the interest rates. The most influential decision makers for a business are the consumers and suppliers. The reason for this is because if the consumers stop purchasing products, then the suppliers would have to lower their prices; this also applies to companies who supply to other companies. The organisations, I have selected for this topic is the Jet Petrol station company.

Stability:

Stability exists when a business produces a forecast for the short and medium term, to identify the likelihood of the product being in demand. Stability also involves being able to organise deals under agreement that everything supplied will be paid for.

Recession

A recession takes place in the economy when people involved in business become more cautious and due to this, businesses have to cut back on certain costs due to a drop in the stock market because of the lack of demand. This occurs when negative impacts of recession occur in a business; some examples are listed below…

  • A business may not be able appoint many new staff members to avoid spending a large amount of cash from the business being spent on the staff wage/salaries, ordering goods that are high in cost effectiveness due to spending more cash in ordering the goods and earning less cash in return.
  • The current V.A.T in UK has gone up to 20%, due to this the prices of certain goods have been increased, therefore people may be on a budget and avoid overspending cash in buying goods, due to the high rate of stock prices.
  • Suppliers may increase their prices per stocks, due to the increase rate of the V.A.T
  • Businesses may face difficulties in finding cheap suppliers as the prices for ordering each stock, are likely to have been increased, therefore a business would want to find a cheap supplier so they can order stocks for a cheaper price and in return, they would want to make profit out of the goods by selling them to the customers. So that they are earning more than what they have spent.
  • Businesses may have to decrease prices of their products and the negative impact that this could create is that… businesses may not make as much profit as expected and despite of not wanting to lower the prices, the business may have to do so, in order to avoid losing customers.
  • Some businesses tend to end up in a situation of being bankrupt, due to losing out on profit and not being able to run the company or pay the fixed costs effectively.
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Boom

A boom takes place when there is a full capacity of growth taking place in the economic environment, these growths include the following, such as: a rise in the rate of employment and wages, a raise in stock market accompanied by a rapid increase of consumer prices which is known as inflation. Government tax revenues will be increased at a faster rate, company profits and investments often increase, and a rise in productivity etc.  

Jet Petrol - recession

If a recession takes place, then it is likely to have an impact on Jet Petrol, as it will ...

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