FACTORS

INFLUENCING
BUSINESS
DECISIONS

YEAR 9 COMMERCE
Core 2: The Economic and Business Environment
Factors influencing business decisions

■ Technology
– Point of Sale (POS) systems
■ Business Cycle
– Point of Sale (POS) systems
■ Globalization
– Point of Sale (POS) systems
Technology
Factors influencing business decisions

■ Influences business decisions by transforming processes and

enhancing efficiency.
■ Refers to the tools, systems, and innovations that businesses adopt to
improve their operations.
■ Technology has a profound impact on business decisions as it enables businesses to
streamline processes, automate tasks, and improve productivity. By leveraging
technology, businesses can achieve cost savings, enhance product quality, and deliver
better customer experiences.
■ Example: Point of Sale (POS) systems. Used in retail and hospitality industries to
process sales transactions, manage inventory, and track customer data. Shows real-time
sales and inventory information.
■ Allows them to make informed decisions regarding stock replenishment, pricing
strategies, and customer relationship management.
Business Cycle
Factors influencing business decisions

■ The business cycle has a significant influence on business decisions as

it reflects the overall economic conditions, consumer behaviour, and
market dynamics.
■ Understanding the phase of the business cycle helps businesses make
informed decisions to navigate economic fluctuations.
■ Example: During a business’s decline, businesses often adopt cost-saving measures,
such as optimizing their supply chain processes. These strategies aim to improve
operational efficiency, reduce waste, and lower production costs.
■ Businesses can adopt various strategies and practices to respond effectively to different
phases.
GLOBALISATION
Factors influencing business decisions

■ Globalization shapes business decisions by creating opportunities and

challenges in a global market. It refers to the increasing
interconnectedness and interdependence of economies worldwide.
■ Globalization has a profound impact on business decisions as it opens
up new markets, enables access to resources and talent from different
countries, and increases competition on a global scale.
■ Example: Cloud computing technology has revolutionized business decision-making
processes. It allows businesses to store and access data, software, and resources
remotely via the internet instead of relying on physical servers and infrastructure
■ Cost savings, increased accessibility, and enhanced security
 PEEL PARAGRAPH
POINT: The retail chain decided to incorporate a new technology software to manage their inventory and track
their replenishments. A number of factors influenced this decision including technology, the business cycle and
globalisation.

EVIDENCE: Additionally, the inventory management system provides centralized control and reporting
capabilities. The head office can monitor inventory levels, sales performance, and other key metrics in real-time.

EXPLANATION: This allows for better decision-making, efficient stock replenishment, and proactive
management of inventory across all stores. This is pure technological influence that improves operations and
allows for smoother business management.

LINK: The business decision to implement a cloud-based inventory management system aligns with
the objective of improving operational efficiency, reducing costs, and enhancing customer satisfaction.
By leveraging technology and optimizing inventory management processes, the retail chain aims to
navigate the challenges posed by the business cycle, sustain growth, and maintain a competitive edge in
the retail industry.