External influences Economy Interest rates Most businesses will need

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External influences Economy Interest rates Most businesses will need

to borrow money. The interest rate will affect how much it costs.

External influences

Economy

Interest rates

Most businesses will need to borrow money. The interest rate will

affect how much it costs a business to borrow money. If the interest

rate is high the money a business owes is more than before. A 20%

interest rate rise would affect Cadbury’s; they would have to pay

extra money towards the loan. This too would affect Sainsbury's in the

same way. Any interest rates that go up will affect a business because

the business needs to make up the costs and the only way to do this is

to higher the prices of their service or products. The company might

have to borrow more money to pay for the interest rate going up.

Competition

Competition is where rival businesses aim their products at the

same customers and try to win and keep their custom. Sainsbury's main

competitors are tescos, Asda and Morrison’s. They all sell food and

household goods. Asda could sell more food than them so Sainsbury’s

would get less customers, Cadbury’s main competition is Masterfoods,

coca cola, Walkers and Rowntrees. If Cadbury in the next year didn’t

release any more chocolates or sweets and rowntrees released different

sweets even though people would still buy Cadburys old ideas they

would buy rowntrees new products. This way Cadburys would loose money

and they would loose customers buying their ...

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