Contemporary Business Environment

This document provides an overview of the contemporary business environment, focusing on the internal and external factors affecting businesses. It also discusses the market economy functions, the role of government, the economic environment in the United Kingdom, the benefits of trade between countries, and the impact of the European Union on British business. The document offers insights into the economic stability, SWOT analysis, and PEST factors of Vodafone, a prominent company in the industry.

CONTEMPORARY
BUSINESS
ENVIRONMENT

Contents
INTRODUCTION...........................................................................................................................3
LO 1.................................................................................................................................................3
Internal and external Factors.......................................................................................................3
LO 2.................................................................................................................................................5
Market economy functions and the roles of government............................................................5
LO 3.................................................................................................................................................6
The Economic Environment Within Which Businesses Operate in the United Kingdom..........6
LO 4.................................................................................................................................................7
Why countries benefit from trade with each other......................................................................7
LO 5.................................................................................................................................................9
The growing impact of the European Union on British Business...............................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
It is very important to understand the company’s economic stability and environmental
factors of the company so that the company will be able to analyze these factors because it will
help the company to grow better in the future. The competition in the market is increasing
rapidly and the growth in the company is very important. The further report will be a brief
description about the internal and external factors of the company, role of government in the
economy, economic environment, benefits of trades and the impact of European Union on
British business.
LO 1
Internal and external Factors
Demand and supply of Vodafone in Oligopoly
Vodafone is oligopoly in the smartphone's operating systems' firm. . On the other
side, Vodafone. is known as monopolistic competition in the branded computers. Compare
to oligopoly, monopolistic competition has more competitors, thus the Samsung Note 10 and
Samsung Note 11 are considered as a monopolistic competition
SWOT
It is very important to study the SWOT analysis of the company because that will tell that
what are the factors which the company will have to build upon and what are those factors which
are the strengths of the company, and they can make them even stronger so that the company can
make a stronger market for themselves (Schaltegger and Burritt, 2017).
Strengths
Vodafone is one of the most popular network cellular’s in the world and have more than
1,000,000 employees in the company worldwide. The impact of the promotion of this company
is very strong and the company is making a lot of profit because it is very experienced in its field
(Namada, 2018). The company is promoting itself through a lot of events like FormulaOne, and
other popular events.
Weaknesses
The company is not doing so well in Europe because of the Brexit and other economical
conditions. The company is not getting as much as from the home town instead they are getting
there 40% revenue from India (Gbadamosi, 2019). There is a market lose in USA even now

which was which the company is having limits to its growth. There is a drop of brand valuation
in the last 3 to 4 years and in the last 1 year it is rapidly falling which is not giving the company
to remain stable in the market.
Opportunities
There is a development which is visible in Africa because that country is developing and
if the company expands itself in those countries then the company will have a great opportunity
in the market (Rosenbach, 2018). The company has expanded itself to 4G which will make the
company gain a lot of profit and to get that the company will have to make their signals more
powerful so that they can capture a lot of people.
Threats
The prices of Vodafone are too high therefore there are customers leaving the company
which is a great threat for the company. The company is getting its revenue from India and in
India the customers are shifting to Reliance which is a huge drawback for the company. Noise
which is created by telecom operators is too high and that is another drawback of the company
(Klauer, 2015).
PEST
Political Factors
The corruption in the company is too high therefore that is not letting the company grow
that high. There are laws for wireless communications which are anti-trust laws which will limit
the company from growing (BAT and YALÇIN, 2015). The company is all about technology
and it is very important for the company to reduce the prices of the company otherwise the
company will not be able to grow. There is a law which is mandatory benefit of the employees so
the company will have to pay the right wages to the employees who are working in the company.
Economic Factors
There is a requirement of skilled employees in the company because this is a company
which is technology based and there can be no mistakes and only professionals can deal with the
problems in the company appropriately. The growth rate of the company economically is high
and the company will have to make it their strength and make more revenues in the market
otherwise the company will not be able to make a large market for themselves.
Social Factors

There are a lot of problems that people can face because of the wireless communication
in the world but everyone in the society wants to own a cellular because they think that it is a
very important part of life. There is no discrimination of any sort in this field because it is very
important for the company to grow and not everyone can make that happen (Sagar, Mehta and
Sharma, 2015).
Technological Factors
The competitor for this company has increased in the recent few years and that is a major
drawback of the company. There are a lot of changes which keep coming in the technology
factor and Vodafone has accepted them completely and always therefore the company is what it
is today. There are a lot of offering on the products of the company and the company had also
tried to expand itself in other sectors.
LO 2
Market economy functions and the roles of government
It is very important to understand the market economy of all the companies because only
after the studies of this factor will the company be able to make the company's products have a
price. The prices of the products will decide if the company will have a good economy or a bad
economy in the market (Harris and Roach, 2017). The supply and demand of the products also
play a very important role in making the price of the products. Economic stability of Vodafone is
also very good but just in the recent years the stability has been reducing because of the
competition which has come up in the market. To make the decisions of the company more
effective and more productive the companies do have to analysis the economic factors because
that will tell the company if they show invest or not in any field. The role of the government is
huge when it comes to the economic factor and that is that the company will have to increase the
price if the taxation for export and import of raw materials are high. In United Kingdom the
import taxation are high because the country wants to utilize their own products instead of
making use of foreign brands and the export taxation are lower because they want to make the
GDP of the country increase because that will get in more money.
This statement will make the company understand the needs in the market and the
customer’s wants which will help the company make bigger and higher profits in the market.

Vodafone can improve their services after analyzing these factors and it will make the company
grow more efficiently. The role of government in economy would be as follows.
 Taxes- The government plays a very important role in the economy of the country by
putting policies. There are a lot of companies which want to expand but the government
of United Kingdom wants the companies of the country to stay in the country which will
make the country grow and not the other nations which will in further help the economy
of the country grow (Olubiyo and Oriade, 2017). The country will promote the
companies in the country but they will not want other companies to come in their country
so easily which will make the other companies and countries are in a loss.
 Infrastructure- The government is also improving the infrastructure of the countries so
that the countries can get in revenue through tourism and not just through businesses.
Vodafone is one of those companies in which the company has spread itself in almost all
around the world but the drawbacks of the company are that they are not being able to
make the most because of the government policies in the different countries.
 Upliftment of businesses- the government of united Kingdom helps the countries to start
a business in their country so that the people of the country get employment so that the
country can make a lot of profit and there are people coming from other countries to
make profit in their country which is also a great advantage for the country.
LO 3
The Economic Environment Within Which Businesses Operate in the United Kingdom
There are a lot of factors which have a major play in the economy environment of a
company in which businesses operate in a country. The different factors which are playing the
role are explained in the further report.
Demand and Supply
Demand and supply in any business plays a very important role in the companies be it a
company in United Kingdom or any other business in any other country. The prices of the
products are set at the highest in the market when the product comes in the market and when the
demand is high and the supply of the product is low then the company will make the price
remain the same and till the demand falls (Jha and Bose, 2016). This is just a way in which all
the companies around the world work. Vodafone also had high prices when they came in the

market but after the competition in the market the company had to lower their prices because the
company was not being able to grow.
Money and Banking
Any business needs money to come in the company and Vodafone is no exception and
the company will do its best t make the company work and get the best of benefits from the
customers. There is a capacity of money which can be borrowed by the bank, individual or
company/ businesses (Kalitanyi, 2019). There is a lot of investment is taking place in the
company and the bank can permit the company to expand in other countries with the help of
loaning money to the company. Vodafone has also taken a lot of economic help from the bank so
that they can capture a large market with a lot of customers who are using this company.
Income and Employment
Vodafone got its income which made the company get its employments very quickly and
since this is a technology friendly company therefore the company had to find people who are
skilled and will help the company to grow even further. Employees in any company makes the
company work even better and the company will be able to make a lot of profit very quickly and
it will help the company to give better services. The rate of demand increases with getting the
right employees in the company and that is very important for any company to have that in the
company.
Recession
When there is a recession in the market then none of the companies can expand and make
profits nor make the companies work this even leads to unemployment. Unemployment is very
good for the country and Vodafone has faced a situation like this before that was after the terror
attach in London (Raziq and Maulabakhsh, 2015). United Kingdom has now started getting a
stable economic rate otherwise they also have faced the worst of situations in the market.
Vodafone was not being able to become one of the best companies because of this factor.
LO 4
Why countries benefit from trade with each other
There are a lot of benefits which will take place in the country because of the trades which
are taking place between two countries. There positive and negative impacts of the trades which
are taking place in the country and those would be as follows.

GDP growth
The GDP growth of the country will increase because that will make the economy of the
country come in and that will make the country get a stable income for the development over all
(Grigorenko, 2019). It is very important for the GDP of the country to grow because that shows
that how much they are developing and the people in the country are also having a good income.
There is import and export which will cost for the country but the export will cost less so that the
countries products can get in high revenue for the country people and the import are going to be
higher because United Kingdom does not want any other country’s company to settle in
UNITED KINGSOM.
Employment opportunities
There has been a change in the employment rate and that is very much visible in the
entire country (Wahab, Mahmood and Bakar, 2016). Since there are a lot of companies which are
opening up in the country, it is because of that reason that there are so many employment
opportunities which are coming in the company because they had a recession going on in the
country and that was only possible when the country’s government will do something about it.
The government is trying to do something about this and they are supporting these new
upcoming businesses which need a help for starting up so that there are new innovative
businesses opening up in their country. Vodafone has over 10,000 employees all over the
country. The company is expanding in Africa too and that will give the African country a stable
economy for their development.
Standard of living
There are a set of living standards that all the countries have and it is very important for
all the countries to have those because those are very important not just for the companies but
also for individual human being (Akama-kisseh, 2016). The human being working companies so
that they can maintain a standard of living and that is very important for any human being and
the companies must provide that standard to the employees and the customers who are a part of
the company. There are a set of standards which a company also has and those are also met by
the company and the management of the company and Vodafone also has a standard of the
company worldwide and the employees also have a standard of living because they are skilled
and they deserve a good wage from the company which will help them maintain a standard for
themselves.

Education level
Vodafone needs skilled employees in the company and that is very important because the
company is a technology based company and getting skilled employees in the company is very
important otherwise a small mistake could lead to major customer lose in the company
(Kasemsap, 2015). The education level of the employees is very high because they are getting
employed and that will give the employees a lot of experience and knowledge even if they are
not educated enough to have a living standard of their own.
Product differentiation
The products which are company from outside the country are getting in products which
are having a high quality and are expensive in the country and those companies are still working
because the GDP of United Kingdom is very good and stable in the present time. The companies
which are already established in the country will try to make the products of the company even
better so that the products which are made in the country will be able to make better sales in their
own market (Raman, Garg and Thapliyal, 2019). Vodafone is not making the most from its
original country but from India but because of the competition in India also the company is not
being able to make a profit on which the company is still working upon.
LO 5
The growing impact of the European Union on British Business
The increase in the disturbances in the growth of the economy of United Kingdom as
European Union have imposed many policies in the business of the country which made it very
difficult for United Kingdom to survive and increase the economy of the country efficiently. The
country has taken a bold step to leave the European Union and which is known as Brexit. This
impacted the country’s trade drastically as the businesses have been impacted due to the sudden
change in the nature and policies of the government. By this the country also decreased its
economic productivity and went to the downfall for the survivability.
The European Union have encourages the investments and also the production of the all
the business activities in United Kingdom and it also helped the country to increase it
employment opportunities. The Union helped the country to support and increase the economy
with the help of import and export of the good and services across the globe (Domanović and
Janjić, 2018). United Kingdom have benefits as being the member of European Union as it
helped the country to decrease the per household cost and also provide a better services to the

population to increase the efficiency and skills of the citizens and be more potential in increasing
the economic growth. United Kingdom have to collaborate with the world trade organisation so
that either can provide a better trade opportunities to the country and also increase the
productivity of the country after the Brexit.
The benefits of being the member of European Union was that it helped the country for
free employment and labour movement across the country easily and also help to provide the
financial support to then country. The increase in the employment opportunities also help to
increase the effect effectiveness of the business organisation of United Kingdom and also help
them to make the higher profit margins and increase the GDP of United Kingdom (Boone and
et.al., 2019).
CONCLUSION
The government plays a very important role in any company in the world for the growth
of the company. It is on the government of the country if the company will be able to expand
itself in other countries or not. United Kingdom is having high taxations because of the
companies getting abroad then in their own countries. United Kingdom’s government is trying to
make the problems of the country dissolve so the countries can develop to its fullest. There were
a lot of problems in the country but now they are solved so that the people of the country can
benefit because the government wants to improve the standards of living of the country people.
The companies now will be able to easily develop themselves within the country and that will
result into a lot of positive impacts. Leaving the European Union is the best decisions because
that will motivate a lot of people to expand themselves in the country. Employment problem in
the country is solved and a lot of people will be travelling to United Kingdom to expand their
businesses in that country soon because there is going to an imbalance in the country’s economy
therefore it will take time to get back to normal. Vodafone is doing great in the country because
have successfully established themselves in many other countries but the headquarters still stay
in UK.

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