Ethics + External Environment 10 Mark Question

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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.

Actual Question

Changes in the external environment can impact on the activities of a business.
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These include:

* The level of consumer spending

* New competitors entering the market.

Evaluate whether the changes in the level of consumer spending or the entry of new competitors into the market will have the greater impact on SOF.

Model Answer


Changes in the external environment could have a big impact on SOF. They currently make and sell office furniture to the public and to businesses

Paragraph 1 (analysis of level of consumer spending)

If either group has more or less money available there will be a change ...

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