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Business Studies Grade 11 Business environments and extent of control

Business Studies Grade 11 Business environments and extent of control, Market environment This environment exists immediately outside the business. Macro environment This environment exists outside the micro and the market environments. Extent of control The amount of influence that a business has on the business environments.

Reasons why businesses has more control over the micro environment/less control over market environment and less control over macro environment 

Micro environment 

  • Business owners and managers have a great deal of control over the internal/micro environment of business, which covers day-to-day decisions.
  • They choose the suppliers they purchase/which employees they hire/the products they sell, and where they sell those products.
  • They use their skills and resources to create goods and services that will satisfy existing and prospective customers.

Market environment 

  • Market environment for a business includes company related influences
  • The market environment refers to influences that have an impact on the success in forming and keeping a sustainable business such as competition and suppliers.
  • Businesses can influence their competitors by increasing the quality of their products in relation with competitor prices.
  • The opposite can also be that suppliers’ raw materials can influence the quality of business products

Macro environment 

  • The market environment refers to the major external and uncontrollable factors that influence an organization’s decision making.
  • These factors include the economic/demographics/legal/political/social conditions/technological changes and natural forces.
  • The above mentioned factors affect business performance and strategies.
  • The external environmental conditions that affect a business are generally beyond the control of management and change constantly.
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