Business Management U1 AOS 3 Revision

External environment

all elements outside a business that may act as pressures or forces on business operations

Operating environment

made up of stakeholders external to a business, which have a direct impact on the operation of the business. The business has some control over this environment.

Macro environment

The broad forces, conditions and trends in the economy and society in which the business operates. The business has no control over these factors.

Legal and government factors

designed to protect the rights of employees and customers, as well as preserve the environment.

Failure to comply with legal and government regulations can result in…

a business receiving fines, damaging their reputation or losing their right to operate.

Types of legal and government regulations

Laws relating to establishing a business, industry regulations, employment laws, work health and safety (OH&S) laws, taxation laws, trading laws and environmental protection laws.

Laws relating to establishing a business

registering a business name, getting an ABN, zoning, building and signage regulations, licenses and permits (depending on business operations)

Industry regulations

employees may need certain qualifications

Employment laws

Obligations between employers and employees, protection of employee rights

Work health and safety (OH&S) Laws

Business owners must plan to meet requirements of OH&S laws applicable to their business

Taxation laws

apply to all businesses in Australia, obtaining an ABN, applying for a tax file number from the ATO

ABN

Australian business number

ATO

Australian taxation office

Trading laws

consumer entitlements and product safety

Environmental protection laws

minimise environmental harm

Values and beliefs

shared principles and morals of a group of people or society.

Trend

A general direction in which people’s attitudes or behaviour in society is developing and changing.

Societal attitudes and behaviours

the ideas, values and beliefs held by people in a particular society

Tends vs Values and Beliefs vs societal attitudes and behaviours

Values and beliefs align with trends to form societal attitudes and behaviours

economic conditions

set of influences that relate to economic activity, including interest rates, wages, unemployment, exchange rates and inflation

Interest rate

the price charged or paid for the use of money, i.e. the cost of borrowing.

Tax rate

the percentage of income or value of a good, service or asset paid as tax

Progressive tax system

the more you earn, the more you pay - Australia’s tax system

Recessionary cycle

when the economy is contracting and people spend less

Boom cycle

where the economy is expanding and people spend more

Technological considerations

relate to the growing use of tools, techniques or systems by businesses to solve problems or serve a purpose in operations.

Technological change has lead to…

decrease in number of employees required by a company, an increase in the amount of time and money spent on research and development, and opening up new markets

Overseas market

the wider market that exists outside of your business’ home country

Overseas competitors

Companies that are a threat to your business that exist overseas

Exchange rate

the difference between the value of each country’s currency

Offshoring labour

employing workers that are based overseas for your business.

Online sales

Trades that occur over the internet

Patent

a right granted for any device, substance, method, or process that is new, inventive and useful

Copyright

Free and automatic protection of original works, such as writing, music, art, films, sound recording, broadcasts and computer programs.

Describe

Definition, characteristics/key features of the topic

Explain

Detailed, definition, cause and effect and example

Distinguish

Define both terms and difference(s) between them, with examples

Corporate social responsibility (CSR)

going above and beyond what is expected when it comes to environmental and social preservation.

Factors of the operating environment

Customers, competitors, suppliers, and special interest groups

Special interest group

a group of people who may have concerns about a particular product or business

Types of special interest groups

environmental lobby groups, business associations and unions