The term Business Environment means sum total of all individuals, institutions and other forces that are outside business but have a effect on it’s performance. The economic , social , political , technological and other forces which work apart from the Business Environment .
Like the changes in the Governments policies political uncertainty , changes in fashions and increased competition in the market , all such factors influence business .
Features of a Business Environment :
- Totality of External Forces – Business Environment is the sum of all things external to business firms .
- Specific and General forces – Specific forces include Investors , customers , competitors and General forces include social , political , legal conditions.
- Dynamic Nature – Business Environment is dynamic in nature as there is constant shifts in consumer preferences .
- Complexity – For example it is very difficult to predict the extent of relative impact of social , political trends on market .
- Relativity – Business Environment is also a relative concept as the Internal markets also get their influence from Markets of different countries .