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 Form 1 Business Studies: Business and its environment online lessons

Ways in which external environment can negatively impact on a business.

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Answer Text:
Ways in which external environment can negatively impact on a business.
-Use of absolete technology which may lead to high cost products leading to low market
-Reduction of population which leads to reduced demand for goods and services.
-Political instability which may lead to frequent stoppage or closure of business.
-Change in laws which may make business become illegal and a firm may stop operating.
-Failure to respond to customers tastes which reduces demand for its products.
-Failure to adapt to changes in natural environment can lead to closure
-Poor relations with suppliers leading to unfavourable terms and high cost.


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