Small Business Essay
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Sample Essay on Starting Your Own Small Business
I would like to start by saying that when starting any small business I would certainly need to understand all the possible forces that impact it in order to properly market my products or services.
The forces in the external marketing environment are: competition, political/legal, economic, technological, and social/cultural. Yet their impact on the business will surely depend on the nature of the given business and on the geographic location of the business. For instance, in the communist/socialist economic systems, I would expect to have more political forces impacting my business rather than competition or any other, simply because the government in these countries actively gets involved in the business environment. In the countries like the USA or UK, the role of government is minimal and thus one would expect to see competition as the most powerful force affecting the small business.
The nature of small business matters a lot just because it would differently affect the buying habits and thus might be a subject to economic cycles of the country. For instance, if I sell high value items like jewelry the demand for them would depend on the purchasing power of the customers. Regular consumable items like books, CDs, skateboards, dog food, or shoes, for example are typically bought on a regular basis and thus I would certainly expect the competition to play the main role here. Yet still, if I am not mistaken, there was some sort of index developed (just like index for car, truck, house sales) that stated that during the economic slowdown, the demand for female products like lipstick, lingerie, and shoes typically increases (perhaps to compensate the falling incomes with increased feminine beauty or to increase self-confidence that also plummets once you don’t earn as much as you did in the past). Thus if I market any of those products, it might be also wise to consider the economic external force as of great importance.
The market segment, thus also matters when considering the impact of external forces on the business. The shoes that I market can be aimed at males, females, children, athletes, etc. Because the segments differ in buying habits, the same product thus can be affected by the different external forces. For instance, it is a well known fact that Americans love basketball as well as recreational jogging around the neighborhood. This cultural element thus might also impact the product and one would expect to generate more revenue selling basketball and jogging shoes to Americans than for instance to Canadians. If British like polo and Canadians ice hockey, it might be a wise idea to market these products in these countries. In the Arab world females culturally are confined within a house, thus this external force would prevent us from marketing running shoes for girls in the Arab world. The Latin America and Europe are great fans of soccer and usually play it recreationally in a manner similar to the US practice of shooting some hoops. If we cover these markets we would certainly market soccer shoes to these countries and realize that the cultural/social forces that reflect the market preferences drastically impact our business, too. If the economic situation deteriorates, we should increase the production of female shoes.
In conclusion of my small business essay, I would like to note that the shoes that we market are affected by all the external forces yet differently. One needs to understand that the given political/economic system in which our business is located, probably define the framework within which other external forces will operate. If a given product is aimed at different segments, one would expect the external forces to differently impact each particular product and this is when one would expect to see competition, economic, technological, and social/cultural as the external forces actively affecting our business.