Analyzing Business Environment and Entrepreneurial Opportunities

This assignment requires a thorough analysis of the business environment, including identifying opportunities for entrepreneurs and businesses to thrive. It involves understanding the current trends and eliminating outdated business activities that are no longer preferred by customers or will not sustain in the long run. The assignment also provides references from various books and journals related to business environments and entrepreneurship.

The Global Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
a) Major Forces shaping the Business Environment of car Manufacturing Industry.............3
b) Emerging Businesses opportunities to be presented to entrepreneurs and business
executives apart from production and selling.........................................................................6
CONCLUSION................................................................................................................................9
REFERENCES.....................................................................................................................10

INTRODUCTION
The term global business environment can be defined as societal and task environment of
a corporation affected by global factors. These global factors include economics, labour market,
competition, technological force, legal and political force in global context. The concept of this
practice is to relate the external environment with the business and understanding the factors
affecting it such as legal, political, social, technological and economic.
Volvo is Swedish International company established in 1927 headquartered in Sweden
deals in wide range of construction equipments, trucks, buses, financial services, product related
services and marine and industrial engines worldwide. Volvo also comprises subsidiary company
such as Volvo Trucks, Mack Trucks, Renault Trucks, UD Trucks, Volvo Construction
equipments, Volvo Buses, Volvo Penta, Arquus and Volvo financial services.
The following report will include major forces shaping business environment in car
manufacturing industry, how industry changed in recent years and other changes that may occur
in future gaining competitive advantage; new business opportunities to present to entrepreneurs
and business executives apart from producing and selling of electric cars against linked business
in automobile industry that may not sustain long run in the market.
TASK
a) Major Forces shaping the Business Environment of car Manufacturing Industry
Raw Material Price:-
As Volvo car manufacturing industries enjoyed falling raw material prices from most part
of the year which help the industries pass of the benefit to the customer . The fall in steel price is
favourable to the industry. But from past second half of year the government decided to increase
the 20% afeguard in car manufacturing. Similarly The Government decision to ban car
production, storage and sale of steel without BIS (Bureau of Indian Standard) certificate is
expected which bring hard time for car manufacturing industries. And also the price of
Aluminium were an cause of concern for car manufacturing industries as Industries using the
aluminium instead of steel to increase the weight of car, and import duty of aluminium was hiked
from 5% to 7.5% which didn't go down with the industries as a result the price of aluminium
have greater impact on industry. For car manufacturing rubber is also an important raw material
prices in tyre industries as tyre prices raised, it also has impact on the sale of car manufacturing

industries. The fall in oil prices also has an impect on car sales as an lower oil price (Dumitrescu,
Paraschiv and Nițu, 2019).
Interest Rate:-
With increase in price rate under control, Reserve Bank Of India had enough headroom
to play around with the rates and it has reduce the rate at all possible occasional. 7.5% repo rate
is come down to 6% It brought down the interest rate of car loans. At the same time private bank
rate has fallen 0.37% on car loan. The biggest rate cut off happened just before the festive
season. This gave much helpful to fulfil in the festive season and car manufacturing industries
sales nearby 65 percentage of the car bought during festive season are to be financed. Which
forcrs the car manufacturing industries in the business environment (Ferraro and Briody, 2017).
Policy Bump:-
Car manufacturing industries suffered major setback when it see with policy prospective.
The biggest problem came when supreme court bane registration diesel vehicle above 2000 cc. It
directly impact on sale of vehicles specially Volvo company. As a result of Ban RTO alone
suffered a lose of 10 Crore per day as an revenue, because the high rated car pay high rate of
payment as on registration fees. And thus the car manufacturing industries sales of vehicles goes
down 0.89 percent at 3,34,371 units. It impact the selling rate of car manufacturing industries in
business environment (Thanetsunthorn and Wuthisatian, 2016).
Changes made in car industries from Last few years
Safety needs:-
Today car manufacturing industries made several safety changes as compare to ten year
ago cars, now car coming with more safety equipment such as car manufacturing providing more
air bags in front as well as rear seats and also providing accident avoidance features such as alert
sensor, collision warning system, blind spot recognition etc (Prajogo, 2016).
Digitalization across the value chain:-
More data and connectivity across the value chain and it have impact on entire value
chain of the industry from exploring the monitoring the opportunities to consumer and
transforming employees by using the robotic, the power of digitalization is more substantial. It
can be major way for competitive edge. While auto industries supplier and infrastructure
leveraging their access to vehicle progressively drive towards innovation and however mobility

ecosystem helps to leverage the relation with the customer and drive to revenue growth in car
sharing market (Deasy and et.al., 2016).
Legal changes:-
Now the government had decided to start nudging auto makers to shift to green and
electrical vehicles, arrival of cab facilities like ola and uber which change the mindset of people
and this company also emerge the major buyer of the car from manufacturing industries and also
the government want to reduce the over pollution they decided to ban the production of high cc
diesel engine car (Belás and et.al., 2015).
Changes that may take place in future
Internal combustion (IC) engine:-
The Internal combustion engine will disappear from over the next few decades. Electric
vehicles has a next big things, so industry players forgive for not believing this time but will be
different. By seeing the fuel rate rising day by day which shows that in coming few years when
the fuel rate is high that it is not possible to bare the high fuel price by the middle or lower class
customer and they not stop buy the vehicle which results in decline in sells rate. So the auto
industries Plan to shift electrical vehicle or green vehicle (Epifanova and et.al., 2015).
Predictive vehicle technology:-
Artificial intelligence is and important role in future of auto mobile industries as an
predictive capability are more prevalent in cars it personalizing the driving experience. More
manufacturing using the algorithms that use data to automate the process of setting of the vehicle
including car infotainment system. And vehicles are became IOT device which connect to
smartphone and take voice command. Predictive vehicle technology also used sensor in the car
which inform the owner whether service required or not (Eling and Schaper, 2017).
Why companies are making electrical cars:-
Consumer preference of electrical vehicles
The future of the electrical vehicle look bright, the consumer are willing to buy more
electrical vehicles and sells are raising fast, The industry also found that electrical vehicles
demand are growing upto 50 to 60% in recent years. More new models are trying to make by the
industries by seeing the willingness of the consumer towards the electrical vehicles. The share of
global industries also considers the purchasing rate of electrical vehicle are raising (Georgescu
and Popescul, 2015).

Benefits of making electrical Vehicles (EV) in order to gain competitive advantage for business:-
Their are several benefit of making the electrical cars. As it is cheaper to run, And is also
useful for the betterment of the environment as it doesn't cause pollution which is beneficial for
the health. EV offer a great reduction in transport cost for business and also EV are more
expensive to bye. They significant low running cost as compare to petrol or diesel (Saleem,
2015).
b) Emerging Businesses opportunities to be presented to entrepreneurs and business executives
apart from production and selling.
Apart from producing and selling cars there are several new and emerging business
opportunities that Volvo can presented to the entrepreneurs and business executives that may
raise the stake and sales of this type of industry -
Service Centres - The service centre is an automobile organization providing specific services
and product or even group of services and products after it sales for modification, repairment,
replacement. The launch of Electric motor car will raise the business level of the entrepreneurs
by establishing several service centres for the regular maintenance of the car or even at the time
of failure of any specific part (Cepel, and et.al., 2018).
Car Decors - At the time of purchase of automobile or even after a period if an individual feels
the need to add some new parts or feel the requirement for specific modification like redefining
interior, put some add on accessories like steering knob, Bluetooth devices, sensors, etc thus
generate business for car decor centres. The customers are to be entertained with different design
and interior models for their newly purchased Volvo cars (Akhtar and Sushil., 2018).
Car Accessories stores - This type of business as considered is in trend these days as today's cars
have some attractive features if some add ons are added to them such as the USB Chargers, Paint
Protection, Side Mouldings, License Plate Frames. Each and every individual owning a car has
different taste development about the preferences thus the entrepreneurs focuses on trends and
invest in these types of businesses (Lee, 2017).
Car rending businesses - By the launch of electric motor car by Volvo the fuel cost or energy
cost became reasonable and affordable allowing the car rending companies like Northgate, TLS
vehicle rental, etc. to lend their cars in a reasonable price thus raised business stakes. The
business is promoted in a way that the people rend card purchased from Volvo at a reasonable

prise keeping a minimum amount of profit help them promote the vehicle at several times and
also giving business to the rending company as well (Moroni, Arruda, and Araujo, 2015).
Car Exchange - By promoting and initiating this type of practice will increase efficiency of sales
in Volvo as it promotes the buying capacity of customer's they started accepting the old and used
cars of the customer's through different mediately firms and by deducting the value of it they
adjust the amount in new car purchased (Belás and et.al., 2015).
Driving school - Volvo suggested driving institution to several of the entrepreneurs associated
with it to enhance driving skills for their customers. The company focuses on spreading driving
awareness to the customer's and enhancing the business of the people associated with it (Prajogo,
2016).
Mobile Mechanic - Volvo found the mobile mechanic concept amusing and promoted the type of
business to several of the new entrepreneur in market by providing them deep knowledge of cars
and several necessary tools. They motivated the entrepreneur by convening that cars always
break down and there is always a need to on spot mechanic. Thus help them develop emergency
vehicle consisting of necessary tools and expertise to fir Volvo cars when necessary (Lee., 2017).
Open gas station - The entrepreneurs and business executives are suggested and motivated in
opening or collaborating with a particular gas station or suggesting entrepreneurs to one to
maximise the profit of the company. The company promoted the station by filling gas in each
and every vehicle they own and by promotion of fuel quality and excellent schemes for other
customers to fill the fuel from it (Moroni, Arruda, and Araujo, 2015).
Upholstery work - The business executive of the firm are entertained to do upholstery work as
the customers in the company are found of the work in Volvo cars as it make the car look decent
and attractive promoting the work of upholstery with their automobile sale (Akhtar and Sushil.,
2018).
Comparison website - The entrepreneurs and business executives of Volvo may suggest other
businessman to purse for digital website to compare the automobile cars as in these time people
focuses on gathering information and comparing them through online sources as it is new
technique for gathering information (Moroni, Arruda, and Araujo, 2015).
Car wash and Basic check - The Volvo must promote the plan of cash wash station to several
businessmen and entrepreneurs to promote this a type of business. Today every individual is
looking for car wash stations at their place with the installation of these station the Volvo can

have daily reservation of car wash and basic check requirements of the customers using other
brand cars as well. The practice will help them generate business and earn income for their
routine activities (Cepel, and et.al., 2018).
But on the other hand their might be some business that may run out of trend in
automobile industry by the passage of time and people may ignore investing in them -
Spare parts business as today's automobile company Volvo is providing lifetime
guarantee on several of it's spare parts. The dealers of several replacement parts outside the
company are facing problems in sales of spare parts as the Volvo product cover under several
replacements and return policies for a particular period of time resulting in less output of spare
parts business. And they also provide time to time discounts to its employees and other bonuses
vouchers so that they can get their cars fixed at the time the discounts are implemented by the
company. So if the local repair stores or an entrepreneur invest a particular amount of money in
the spare part business he might not be able to generate sufficient profits (Saleem, 2015).
Local repair station failed to sustain market competition by big companies like Volvo as
they installed heavy computerised and modern machines to fix technical and other problems in
the car on the other hand the local repair shops failed to invest that much amount of money in
their shop to buy such heavy machines with the installation and eliminated by the competition in
the market as their earnings are not sufficient as planned (Georgescu and Popescul, 2015).
Car Decors faced huge downfall in today's market as the current car company already
provides all the safety accessories like airbags, sensors, etc. and cosmetic accessories such as
mouldings, roof shade, glass protection, etc. with different shades and variety thus eliminate the
chance of change of customer's mind for further modification of the vehicle. They investment in
this type of business is high as the individual need to maintain entire range of products but may
not generate effective sales figure as estimated (Epifanova and et.al., 2015).
Used Cars Buyers businesses also faced downfall as the customer's in Volvo are
entertained by good exchange value bonuses and the best value of their used cars by the
company and thus they prefer Volvo store to exchange their old car in order to attain those
attractive offers at the time of their purchase. The owner in this case if needs to sustain the
competition in the market he must offer the revalued price higher than the Volvo company thus
minimising their level of profit (Belás and et.al., 2015).

CONCLUSION
The above study concluded that Volvo apart from manufacturing and selling cars they are
presenting various opportunity plans to entrepreneur and business executives like to opt
businesses such as driving school, provide mobile mechanic services, tie up with cars accessories
stores and some other business that are currently in trend and eliminate the business activities
that are outdated are no longer preferred by the customers or will not sustain in long run such as
used cars store, local service centres, etc to decrease the productivity.

REFERENCES
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business environment.Business Process Management Journal.
Belás, J. and et.al., 2015. The business environment of small and medium-sized enterprises in
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Cepel, M. and et.al., 2018. Business environment quality index in the SME segment.Journal of
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Deasy, S. and et.al., 2016.Controlling use of a business environment on a mobile device. U.S.
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