Impact of Regulatory, Political & Economic Environments on Coffee Shop

This essay explores the regulatory and economic factors involved in opening a coffee shop in Australia. It highlights the importance of adhering to Australian laws and regulations related to the food and beverage industry, consumer protection, environmental legislation, and privacy laws. The essay also discusses key economic concepts such as demand and supply, trade, and elasticity, and their relevance to the coffee market in Australia. It emphasizes the growing demand for coffee in Australia, driven by immigration and changing consumer preferences, making it an attractive market for new coffee shop ventures. The Australian government's role in ensuring fair trading and consumer protection is also examined. Desklib provides a platform for students to access this and other solved assignments.

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OPENING A NEW COFFEE SHOP IN AUSTRALIA
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Abstract
Just like any other business, putting up a new coffee shop would mean abiding by the
rules, laws and the regulations of the country that govern all types of business. This would be
important since both the customers, suppliers and the owner need to be protected by these laws.
Therefore, a coffee shop would be categorized under the food and beverages industry. Hence, it
would be required to have a permit from the authorities for one to run such a business. Australia
over the past few years has been on the spot light for its increased demand of coffee. However,
this increased appetite and demand towards this particular product has been due to the great
immigrants. The immigrants number is contributed by both the Greek and the Italians who have
moved to Australia for various reasons such a business and pleasure. The essay is also going to
discuss the various business economic concepts such as interest rates, trade, inflation, supply and
demand, elasticity, market structure and pricing.

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Venturing into a new business opportunity, this would mean for one to fast be
versant with the rules, laws and regulations pertaining that particular type of business. For
instance, putting up a new coffee shop would mean, meeting all the statutory regulations such as
acquiring a business permit. This in exchange would mean legally running of the business with
the consent of the local and national authorities (Chapman & Hodges, 2017). On the other hand,
a coffee shop, which is categorized to fall under the food and beverages industry, is always
considered to be very sensitive. The main reason being, the Australian government is very
concerned about the health of its citizens who are the tax payers. Thereby, one has to meet the
standards and measures that regulate such businesses. One has to satisfy that the product been
sold meets the required standards and measures and its fit for human consumption.
In addition, the Australian government, in conjunction with the state territory
legislation and local authorities usually exist. The main reason for their existence is for them to
insist and enforce all the regulations set aside pertaining a particular type of business.
Furthermore, their existence is critical since the community, consumers and the environment
need to be protected. Furthermore, apart from the protection, these government branches need to
promote fair trading and competition as well among its tax payers. Basically, these rules, laws
and regulations normally govern how businesses interact on daily basis. For instance, when
running a business, customers, suppliers and other business usually interact since they all need
each other for them to run smoothly. Furthermore, the relevant government authorities usually
outline the rights of both the business owners and their businesses especially when conflicts arise
(Gale & Haward, 2015).

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Australia, through the help of the Australian Competition and Consumer Commission
(ACCC), which is a national statutory framework, is able to facilitate and ensure that doing
business is observing fairness between the consumers and the businesses. This is monitored
under the competition law. More importantly, the Australian government legislation, territory
and state laws oversee consumer protection. All this is met by putting up a fair trading office in
each territory so as to provide necessary advice on businesses rights and obligations.
Under the consumer laws, the Australian Consumer Law (ACL) usually provides
regulations on a number of priorities. These priorities include the consumer rights guarantees,
unfair contract terms, product safety laws, penalties, unsolicited consumer agreements and other
areas. Another law governing the opening of the coffee shop is the environment legislation. The
Australian government authorities are very sensitive about the issue of environment protection.
Therefore, it joins forces with the local governments and territory authorities so as to administer
environmental protection. This is met through division of labor whereby, the territory and state
environmental protection legislation is applied to specific business activities, such as those
pertaining a coffee shop. While on the other hand, government legislation governs the entire
process of assessing and approving the national cultural and environmental concerns.
By opening a coffee shop, one has to consider the privacy law (Siddique, 2017). For
instance, in Australia, there is national privacy legislation. Usually, this is overseen by the office
of the Australian Information Commissioner (OAIC). This body regulates how businesses can
store their personal data and communication and also the method of collecting as accessing the
same data. Moreover, sensitive data such as the medical records of the owner are highly
protected from anyone accessing them without adequate reasoning (Winston, 2016).

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On the other hand, the essay shall discuss various economic concepts and their
importance particularly in putting up a new coffee shop. We shall begin by discussing the
demand and supply of coffee in Australia.
Demand and supply
Demand, is said to be the willingness and ability of a consumer to buy a certain product,
good or service at the current market price. On the other hand, supply is said to be the
willingness and ability of a supplier in availing the product, goods or services at the current
market price. However, the balance between the demand and supply in the market always
determines the price at which the product is going to be sold at. Normally, this is determined
over a given period of time. For instance, coffee which is a beverage and is produced from coffee
beans, its demand and supply shall be determined by the market price. Lately, Australia has been
on the map for its demand and supply of coffee to its consumers. In 2014, a survey done by the
Australian Health Organization, indicated that, forty six percent (46%) of the Australian
residents are consumers of coffee products. This percentage had overlapped the tea lover’s
community hence showing how many of the people preferred to consume coffee (Pride &
Ferrell, 2015). However, there are some various factors that affecting the demand and supply of
coffee in Australia. Such factors include close substitute product such as tea and their prices,
taste and preferences, level of income and taxes and also customers’ expectations (Goss, 2011).

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2014 2015 2016 2017 2018
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Demand
Figure 1: A graph showing an increase in demand for coffee over the past five years.
Trade
. Australia is not among the coffee producing countries in terms of coffee productions.
However, statistics show that, Australia is among the biggest coffee consumers in the universe.
Therefore, coffee being among the most consumed products in the country, which would mean a
ready available market for a person who wants to venture into the coffee business. Availability of
ready market for a product motivates an entrepreneur to invest more with no fear of loss. This is
due to a guarantee of customers on daily basis hence contentious flow of income in to the
business. As per the year 2018, the revenue of coffee shops and cafes in Australia was forecasted
to an estimation of about 4.7 billion Australian dollars. Moreover, there was another forecasted
value added in the coffee, food and beverages industry of approximately 1.5 billion Australian
dollars.
Elasticity
Elasticity is said to be the degree to which consumers, individuals or producers tend to
change their demand, taste and preference or the amount on which is supplied in the market.

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Usually, the amount supplied in the market is always responding to the income or price changes.
For instance, Australia has become one of the major coffee user countries among the Ocean
region. Moreover, it has become among the instant coffee consumption outstrips which is only
practiced by few countries. Bottom line is, the Australian coffee market is forecast to increase
even in the future years. This is greatly facilitated by the Australian lifestyle and culture which is
driven towards the love for coffee and its market. It has been observed over the past few years
that, coffee shops and cafes industry has experienced a massive growth. This is courtesy of
coffee lovers who value high quality coffee and has turned this to be their behavior (Bortman,
2014).
Conclusion
Consumption of coffee in Australia over the past few years has greatly experienced a
massive growth economic wise. Thus, opening a new coffee shop would guarantee one of
constant customers and a continued flow of income to the business. However, one has to highly
focus on the quality of coffee sold for him or her to sustain his/her customers. In addition, the
Australian government in conjunction with the local authorities has ensured that there are
relevant regulatory that protect both the business owners, suppliers and consumers.

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Works Cited
Bortman, M. (2014). Environmental encyclopedia. Detroit: Gale.
Chapman, G., & Hodges, G. (2017). Compliance. South Yarra: Macmillan.
Gale, F. P., & Haward, M. (2015). Global commodity governance. Basingstoke: Macmillan.
Goss, A. (2011). The floracrats. Madison: University of Wisconsin press.
Pride, W. M., & Ferrell, O. C. (2015). Foundations of Marketing. Hoboken: Wiley & sons.
Siddique, M. A. (2017). The economics of tea and coffee consumption in Australia. Nedlands:
University of Western Australia.
Winston, T. (2016). Coffee Grwoing in Australia. Barton: RIRDC.