There are three primary environments that firms should be tr

There are three primary environments that firms should be tracking as part of every business planning process. What are they? What are the subcomponents of each? You will need to articulate your answer with extreme detail and examples to show an in-depth understanding of each of the variables.

Solution

usually the factors can divide as external factors and internal factors. external factors includes political, economical, social and cultural factors. internal factors inclues the firm technological capacity, financial ability and competitiveness of the firm in the market.

among all these a firm mainly focuses on economical factors of the nation, social factors like consumer behaviour, his buying pattern and buying behavior and competitive aspects.

the first one speaks about the nations GDP and people income levels, their standard of living etc. if people are getting good incomes they can spend some amounts on purchasing goods and services. and the firm can sell its products to the customers, they can earn good revenues. at these conditions the firm can expand its business in future.

the second factor is customer buying behaviour, how frequently and regularly he buys a product or he goes it for oftenly. if people buys again and again it is an indiacation that new cusomers are adding and the existing cutomers also repeatedly purchasing the product. this study involves what the customer is looking for, what kind of product can be fulfill his requirement and so on.

the third factor is competiton in market. how many players are there in the market like us, and what is the market share we are going to be taken from the market and what is the potential market size. is there any chance to enter into any new markets or expand the existing business or diversified.