CHALLENGES OF THE MACRO ENVIRONMENT - created from Mind Map

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Economic factors

Political changes and micro-lending.

Laws and restrictions.

Socio-economic issues, challenges and demographics.

Government decreases interest rates.

Government increases taxes.

Government increases spending on infrastructure.

Entrepeneurs are more willing to take loans and start or expand businesses.

Consumers have less money to spend so business' sales and profits decrease.

Employment increases so people have more spending money. More jobs are created and the economy grows.

Political Stability is very important for economic stability.

The government in power also sets up trade agreements with other countries.

Puts pressure on businesses since they want to support micro-businesses, but they are at a big risk as many fail and cannot repay debt.

If the political arena is in turmoil, investors are very hesitant to invest more money into enterprises and may withdraw already invested money.

The governments effectiveness and attitude towards imports and exports can have a major impact on businesses.

Micro-lending offers the poor the opportunity to borrow money and start a micro-business.

Sometimes government will pass laws that create challenges for the business.

Government has passed a number of laws which impose restrictions on businesses labour practices.

Businesses can benefit from international trade, but they have to be able to compete globally.

Management needs to keep up with new legislation and ensure that they adhere to all new laws.

These acts pose a challenge to businesses that have to find the right candidate for the job.

Example: The Skills Development Act (SDA).

Businesses are challenged to learn about and understand different cultures, religions and social norms and values.

Businesses are faced with many challenges in a country.

All these issues can make running a business very difficult.

Management needs to get to know their customers and potential customers to understand their needs in hope to gain loyal customers.

That has insufficient skills, poor education, tremendous unemployment, unacceptably high crime rates, and a very high percentage of people living with HIV and AIDS

It also makes being socially responsible and an essential part of every business, vision and mission.