How Society Affects Businesses

1161 Words5 Pages
Enterprise and Its Business Environment Essay Select one of the PEST factors and discuss the effect and influence that this factor has on businesses. PEST analysis is applied in many large organisations as a method of predicting change in political, economic, social and technological factors. It is a component of the external analysis when a business decides to conduct market research for example. It is a beneficial strategic tool regarding the status of a business in comparison to competitors and future business direction. In this essay I will present various effects and influences society has on businesses in order to show you specifically how significant social class, lifestyles and other social aspects can be relating to businesses. Firstly, social class has arisen over time due to growing inequalities across the world. Consequentially people have been divided into different categories. For example, in India the ‘caste system’ is one which results in social limitations and tends to define communities. Systems such as these serve to influence spending power and overall quality of life. Social class can differ from country to country with ‘social mobility’ either increasing or decreasing. Advertisers and market researchers such as the Institute of Practitioners in Advertising tend to use the ‘ABC1’ social classification system which assigns individuals to certain letters dependent on their occupation and income (Worthington and Britton, 2006). It is also assumed that an individual’s job is intimately linked with their attitude and behaviour (e.g. wealthy business men more likely to buy a fancy car). There are many different Industries which are affected by social class- from household appliances to the holidays so businesses must either offer a price range for certain products or concentrate entirely on one or two specific social classes. Class may also
Open Document