BM461: Analyzing UK Consumer Confidence and Investment Trends

This report provides an analysis of UK consumer confidence data to identify business sectors that will prosper or struggle over the next 12 months, offering investment suggestions for amateur investors. It discusses the importance of consumer confidence as an economic indicator, highlighting the potential struggles of the tourism sector and the growth prospects of IT firms. The report also examines different phases of the business cycle to guide investment decisions. Furthermore, it includes an email discussing legal structures for a business startup, comparing sole proprietorships and partnerships, and evaluating market structures like perfect competition, monopolistic competition, oligopoly, and monopoly. The competitiveness of these market structures is assessed, along with a brief overview of HMRC import duties.

GLOBAL BUSINESS
ENVIRONMENT

Table of Contents
2 a)...................................................................................................................................................2
Consumer confidence and its importance....................................................................................2
Business sectors that will struggle over 12 months.....................................................................2
Business sector that will prosper over 12 months .......................................................................3
Suggestions for an amateur investor to invest.............................................................................4
2 b)...................................................................................................................................................4
Purpose of the email.....................................................................................................................4
Legal Structure.............................................................................................................................4
Best Legal Structure.....................................................................................................................5
Different Market Structures.........................................................................................................5
Competitiveness of Market Structure..........................................................................................6
Considerations and conclusions to finish the mail.......................................................................6
REFERENCES..................................................................................................................................

2 a)
Consumer confidence and its importance
Consumer confidence is an indicator of economy. It determines that how many consumers
are confident about the overall state of the economy. If consumer confidence is increased, it
means there is a higher economic growth, which in turn indicates higher consumption.
Expansion of economy helps in increasing the consumer confidence(Khan, and et.al., 2019).
Business sectors that will struggle over 12 months
Business sector related to tourism will struggle over 12 months. Because this sector is considered
as most important sector of the economy and it accounts 10% of total GDP(Tourism-dependent
economies are among those harmed the most by the pandemic,2021). Because business sectors
which are related with tourism has shown a drastic downfall. It is one of the sector on which
government laid the taxes. Security is also a major challenge for the tourist industry because
issues related with security have been failed to confronted by many leaders. The other challenge
that this industry will face is havoc from the natural disaster because places of tourism which are
centre of attraction for the tourists are going to suffer a lot due to the natural disasters. This
might be possible that due to this tourism industry will suffer a lot(Sofronov,2018).
However on a critical note it can also be said that in the upcoming years there may be the
chances that a situation of boon can be seen in the tourism industry.
Business sector that will prosper over 12 months
Business sectors related to IT firms will prosper over 12 months. Because due to fast
growing technologies, IT sector is already on the rise. Instead of physical meetings, consumers
are switching for virtual or online meetings. As the advancements has increased in the world of
technologies, the IT sector has shown a growth. Due to all these, development of new
technologies has taken place and due to this technological transformation, there is a beginning of
multi-technological transformational phase. Due to sustaining growth of IT sectors, people are
taking more interest to invest in this sector. These sectors will improve the overall performance
of the markets and will continue to upsurge.
Hyperlink Info system is a company which is popular in web and mobile app
development. With an experienced team of 250 plus developers, the company is providing
services related to Web & App development, Game app, Blockchain solutions, AR / VR apps,

Sales force, Artificial Intelligence and many more sectors(Palgrave,
London.HyperlinkInfoSystem., 2021). The company has a vast experience in developing mobile
application which is state-of the art at a cost effective price. It is a software development
company that has earned its name in the top market within a very small amount of time. This
company was initially started as mobile app development company for global businesses, in
2011 which achieved a client base of over 2300 employees all around the world. The company
has 450 expert developers under their roof, the company has established as an authentic,
dependable and acceptable software solutions in the market. Today the journey of Hyperlink Info
system of success can be an inspiration for all emerging IT business firms. However, the firm has
committed to provide the highest quality solutions to its clients and also profitable growth
without overwhelmed by the success.
However on a critical note it can also be said that in the upcoming years, the IT firms work on
adapting new and advanced technologies which can be useful in coming years as well.
Suggestions for an amateur investor to invest
When the economy of a nation either grows or declines then, it is termed as a business cycle.
The different phases of business cycle are as Expansion, Peak, Contraction and Trough.
During expansion phase of business cycle, there is a rapid growth in the economy and the
level of production also increases so the investor will invest. Peak is that phase of business cycle
which consists of several imbalances in the economy which needs to be corrected so the investor
will think before investment. Contraction is that phase of the economy in which the employment
level falls and growth rate slows down so in this phase also investor will not take the risk in
investing because the growth rate is slow. Trough is that phase of business cycle in which there
is a recovery of the growth so the investor can take the chance for investment.
2 b)
Purpose of the email
The main purpose of the email is communication. It can also be used for different
purposes such as for providing the instructions and for rules and procedures to be communicated.
Legal Structure
Legal structure: A legal structure can be defined as key determinant of an activity that an
organization undertake. The two legal structures discussed here are as follows:
 Sole Trader

 Partnership
Sole Trader:
Sole Trader is a person who runs or owns his business individually. Sole Trader is a legal
businesses structure in which there is no legal distinction between the owner and the business
entity. The profit is received individually by the sole trader only and the sole trader has an
unlimited responsibility of debts and losses.
The pros of sole trader can be that if someone is running business as a sole trader, than there
is no need of business to get registered somewhere.
The cons for the sole trader can be that the liability of sole trader is unlimited.
Partnership:
A partnership is an agreement between two or more persons who agree to share the business
and profits of the business. In partnership, profits and losses are share by all the members.
The pros for the partnership can be there is more availability of capital for the business.
The cons for the partnership can be every decision is taken with the agreement of all the
partners. No partner can take the decision of the business alone(Stott, 1973).
Best Legal Structure
The best suitable legal structure could be Sole Trader. Because it is the legal structure
which is relatively simple and easy and its set up is very inexpensive. It is the most popular form
of legal organization the registration process of it is very easy. The trader only needs a licence
for registration of its business with the local government. Sole Trader can take the decisions by
self, without interference of any other person. Simplicity is also one of the biggest advantage of
the sole trader. In comparison with other legal structures, the demands are less overwhelming for
the sole trader. The sole trader is the person who alone runs the business therefore, he works with
higher efficiency, enthusiasm which in turn helps in maximization of profits. The paperwork is
very less, if a firm operates as a sole trader because the filing requirements are very few for a
sole trader. There is no sharing of profits amongst others because in sole trader, there is a single
owner who is running the business, so the owner will get all the profit.

Porter 5 forces
The Porter 5 force model, is one of the best competitive business model, where extensive
competition holds huge importance to be further prioritized based on significant scope to develop
untapped fundamental growth innovatively. The model has specific 4 factors, which are threat if
new entrants, bargaining power of buyers, threat of substitute goods, and bargaining power of
suppliers correlated to external competition. Threat of new entrants : High barriers to entry, economies of scale, capital requirements
and new dynamic changing competitive business environment are some specific factors
correlated to threat of new entrants. Bargaining power of buyers: Buyers ability to purchase new products, services and
switching costs within competitive market where customers hold huge potentiality to
change market structure. Threat of substitute products: The threat of substitute products, is highly essential where
buyers have different options for productive services within extended determined levels
priorities engagement. Bargaining power of suppliers: The suppliers have huge responsibility, where it comes
to further extended new ability maintenance diversely based on optimum vision. Size and
structure of suppliers, plays keen role where product varied choices are effected with new
industry growth goals.
 Rivalry against existing competitors: Number of competitors, changing industry growth
scenarios and new switching costs are some key domains where companies in recent time
are heading to establish new key domain.
The porter 5 forces model holds huge significance for extending new competent market stability
Different Market Structures
Perfect Competition: There is large number
of buyers and sellers in this market structure.
The knowledge of market is perfect to both
buyers and sellers(Azevedo and et.al. 2017) .
Monopolistic Competition: In this type of
structure different types of products and
services are offered by the firm and the
services and products which are offered are
not perfect substitutes of each other.
Oligopoly: It is a market structure in which Monopoly : It is a market structure in which

number of firms are very small, and they are
interdependent of the policies related to pricing
and output(Pellegrino, 2019).
there is a single seller and in this market the
seller is selling a unique product(Merhav,
2017).
Competitiveness of Market Structure
In the market structure where competition is very intense, companies are attracting the customers
by cutting down their prices and by launching campaigns of marketing. On the contrary, if the
competition is very minimum, than the company will be getting healthy profits and the power of
competitor will also be tremendous.
It will be easier to switch to a cheaper alternative, if a company has a more supplier. If there are
few suppliers than, there is more ability to charge more. This will impact the profitability of the
business.
If the number of suppliers is more than the buyer than it is known as '' buyer power ''. It means it
will cut down the prices, which will help in switching new and cheaper competitors.
Threat of Substitution refers to finding a different way of doing the work which a person is
doing. An easy substitution can threaten the profitability and position can also be weakened by
that.
The position of the firm can also be affected by ability of the people to enter the market. If the
company has a little protection for their important key technologies than the position of the
company may become weak and it is helpful for the rivals to enter the market quickly.
HMRC Import duties
HMRC Import Duties are Her Majesty Revenue and Customs. It is the authority of tax for
the government of U.K. This authority is responsible for collection of taxes, enforcing taxes and
laws related with customs and for enforcement of payment of employers through minimum
wages. It can be also analysed that import duties, further extensively brings on keen importance
rise for gaining further extensive scale growth competitively. HMRC import duties, are some of
the most keen specific aspect where authority is further extensively responsible for new enforced
taxes and specific laws. It can be also analysed that HMRC, extensively heads on profound focus
towards new changes evolved within financial working standards and actively synchronizing
new import standards.

REFERENCES
Books and journals
Azevedo, and et.al., 2017. Perfect competition in markets with adverse selection. Econometrica.
85(1), pp.67-105.
Khan, H. and et.al., 2019.Consumer Confidence and Household Investment (No. CEP 19-06).
Merhav, M., 2017.Technological dependence, monopoly, and growth. Elsevier.
Pellegrino, B., 2019. Product differentiation, oligopoly, and resource allocation (No. ppe860).
Job Market Papers.
Sofronov, B. 2018. The development of the travel and tourism industry in the world. Annals of
Spiru Haret University. Economic Series. 18(4), pp.123-137.
Stott, J.R., 1973. The Sole Trader and the Partnership. In Basic Commerce for First
Examinations (pp. 71-77).
Online References
Palgrave, London.HyperlinkInfoSystem., 2021. [Online]. Available
through<https://www.hyperlinkinfosystem.com>
Tourism-dependent economies are among those harmed the most by the pandemic., 2021.
[Online] Available through<https://www.imf.orgexternalpubsftfandd202012impact-of-
the-pandemic-on-tourism-behsudi.htm>
1