AS 91380 (3.2):
Demonstrate understanding of strategic
response to external factors by a
business that operates in a global
context
Part F – CHANGES IN
GLOBAL MARKETPLACE
The marketplace has
changed significantly
in recent decades.
O We have become used to one-stop-shop
destinations such as huge shopping
malls and large retail parks which are
usually found in the suburbs. Malls and
retail parks appeal to customers because
they have a variety of stores, long
shopping hours and plenty of parking.
O Trading hours have been extended to
seven days a week for most retail outlets.
O Many retailers have diversified their
services. Furniture stores now sell financial
services and insurance, petrol stations sell
groceries, general stores such as K-Mart
and The Warehouse sell everything from
lollypops to home entertainment centres.
O Some “stores” are mere kiosks, and some
are non-permanent pop-up stores with
short-term leases on retail premises.
O There is now an abundance of
discount stores, such as The $2 Shop
that sell a broad range of cheaply
made products such a stationery,
party supplies and homewares. These
shops have brought welcome
competition to consumers but are of
concern to traditional suppliers such
as stationery shops.
O E-commerce has changed how many
of us shop. We access goods via local
websites such as TradeMe and
international sites such Amazon. We
make use of online services such as
banking, airline bookings and
comparing insurance costs.
O Some businesses have
retained a physical
presence and added an
online facility (“bricks
and clicks”), while
others are “clicks”
enterprise as they only
operate via the internet.
Owners of smartphones
or tablets can conduct
much of their shopping
with their hand-held
devices.
O Call centres, many of them located
overseas, are used to sell us products
and to deal with our queries about
computer issues or lost credit cards.
O We can sit in our lounges and buy from
home shopping channels which
broadcast on digital television.
O As our population has become more
ethnically diverse, the range of cuisine
options available to us has increased.
O Despite the huge range of food and
wine offered by supermarkets, there has
been a move by some consumers to
shop at weekend farmers’ markets and
small specialty food stores such as
Nosh and Farro.
O How we pay for our shopping has also
changed. Cheques have almost
disappeared, cash is used in fewer
circumstances, but the use of
electronic transfer payments has
grown enormously.
Perhaps the most significant change is
that consumers and businesses are
now very comfortable operating in a
global marketplace. That is, buying
internationally known brands, wearing
clothing that has been manufactured
overseas, and using the world wide web
to research, select and pay for goods
and services.
Impact of the Recession
An economic recession is defined as six
months of declining gross national
product (GNP). A recession that lasts for
a year would be known as a double-dip
recession.
A recession has serious consequences
for the business sector and the
economy as a whole. In a recession:
Well-managed businesses may be able to
take advantage of a recession. Capital
assets such as land may be relatively cheap
and firms could invest in these in
expectation that the economy will eventually
improve
The risk of retrenchment and job losses
could encourage improved relations between
employees and employers, which could
increase efficiency. The recession may cause
the business to perform in a leaner, fitter
manner by closing unproductive branches
or making tough decisions which will
actually improve profitability.
E-Commerce
SWOT Analysis
Business owners cannot afford to be
complacent about the current success and
future viability of their enterprise. A very
effective tool for auditing a business and its
environment, both internal and external, is a
SWOT analysis which helps a business focus
and build on its strengths, minimise
weaknesses, take the greatest possible
advantage of opportunities available, and
anticipate any threats the business might
face.
Internal analysis
The capabilities of the business, its
strengths, and its areas of weakness should
be examined.
External Analysis
Do an environmental analysis to identify
opportunities for the business, and any
threats or obstacles to performance.