BUSINESS ENVIRONMENT

It refers to all the factors , forces ,

individuals ,institutions which is
outside the control of business
enterprise but effect its
performance
 NATURE OF BUSINESS ENVIRONMENT
• ALL EXTERNAL FORCES :- factors outside are
included in business environment , internal factors
such as relation between employees , labour
management etc are not a part of business
environment.
• SPECIFIC AND GENERAL :- specific is which effect
your business only and general is which effect all
the business
• INTER REALTAION :- all components of business
environment are interdependent.
• UNCERTAINITY :- No one can predict business
environment 100%.
• DYNAMIC :- condition in environment keep on
changing
• COMPLEX :- It is difficult to scan environment
• RELATIVITY:- same condition has different impact on
different business.
 1.
Unique ltd is an electronic goods manufacturing
company situated in uttarpradesh. it is earning low
revenue comparison to another electonic company
'pace ltd' situated in delhi. both enterprise are
impacted by investors customers , competitors and
suppliers in their respective location. at the same
time both also effected by economic conditions,
change in technology etc.

Ans. Relativity and complex

 DIMENSION OF BUSINESS
ENVIRONMENT
• ECOMICAL ENVIRONMENT :- It refers to all the forces and
factors which directly influence the economy of your
country.
1. Any changes in taxes 2. any change in interest rate 3.any
change in value of rupee
• SOCIAL ENVIRONMENT :- Business environment includes
various social forces such as customs, beliefs, literacy
rate, educational levels, lifestyle, values etc.
1. Change in taste , fashion 2.customs and traditions
Ex:- the celebration of diwali or any other festival increase
the sale of sweets , greeting cards , etc.
• LEGAL ENVIRONMENT :- : It includes various laws and
legislations passed by the Government. The
mangaement of every business has to obey the law of
land.
1.Court judgement 2. any act
• POLITICAL ENVIRONMENT :- it constitutes all the factors
related to government affairs such as type of
government in power, attitude of government towards
different groups of society, policy changes implemented
by different governments etc.
1. Constitution of the country 2. Relation of our country
with foreign country
• TECHNOLOGICAL ENVIRONMENT :- It includes
forces relating to scientific improvements and
innovations, which provide new ways of producing
goods and services and new methods and
techniques of operating business.
1. Change in method of production 2. New
machinery, new equipment
 2.
'Mamta Rice Food Ltd.' is a well known rice producing company. The sales have
been falling down from the beginning of the year. The managing director MR.
Bhuvan is worried about this situation. With a view to find out the solution of
this problem he made a team to find out the reasons for downfall of sales. The
team conducted the survey and gave following four reasons for the downfall of
company's sale.
(i) On account of increase in export duty made by the government, the foreign
demand has gone down.
(ii) Due to availability of other eatable substitute the taste of people is diverted
from rice. 
(iii) The competitor's imported new technology machine and arc producing
better quality rice.
(iv) Due to strain with neighbouring country's government and our country's
government export is effected.
Identify the dimension of Business Environment discussed in the above case:

Ans. 1. Economic environment 2. Social environment

3. Technological environment 4. Political environment
 Demonitisation
• The Government of India, made an
announcement on November 8, 2016 with
profound implications for the Indian economy.
The two largest denomination notes, `500
`1,000, were ‘demonetised’ with immediate
effect.
 Features of Demonitisation
• (i) Elimination of Black Money

(ii) Eradication of Corruption

(iii) Money laundering:- Money

laundering is the illegal process of making
large amounts of money generated by a
criminal activity.