This document outlines the various factors that make up the internal and external environment for businesses. It discusses the micro environment including suppliers, customers, and competitors. It also examines the macro environment and its uncontrollable external factors such as economic, political, legal, socio-cultural, technological, physical, and demographic environments. Finally, it covers international marketing factors like social, economic, competitive, logistical, and risk considerations that influence global business operations.

1. UNIT -II

2. There are two kinds of environment:
I. MICRO – Controllable [ Internal ]
II. MACRO – Uncontrollable [ External ]
In micro environment:
a)
b)
c)
d)
e)
Suppliers
Market Intermediaries
Customers
Competitors
Public

3. A – Grab the ATTENTION
I – Generate the INTEREST
D – Arose DESIRE
A – Lead to ACTION
SWOT ANALYSIS:
S – STRENGTH
W – WEAKNESS
O – OPPORTUNITIES
T – THREATS

4. Factors of macro environment:
a) Economic
b) Political
c) Legal
d) Socio – culture
e) Technical / Technological
f) Physical / Natural environment
g) Global
h) Demo – graphic environment

5. I. Economic environment:
a) General economic conditions:
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Agriculture
Industrial output trends
Per – capita income [ income per head]
Income distribution
Savings & Expenditure
Price levels
Employment trends
Impact of government policies
Economic systems

6. b) Industrial conditions:
• Market growth of the industry
• Demand patterns of the industry
• It’s stage in PLC [ Product life cycle]
GROWTH
INTRODUCTION
DECLINE
MATURITY

7. C) State of supply of resources for production:
• Land
• Labor
• Capital
• Machinery
• Managers [ organization ]

8. II. POLITICAL:
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Stable government.
Cyclical changes.
Role of private sector in the economy.
Government procedures & changes in
government policy.
Type of government.
Role of small scale industries in the economy.
Role of service sector in the economy.

9. III. SOCIO – CULTURAL ENVIRONMENT:
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Caste
Customers
Convention’s
Cultural heritage & respect for
seniority, women, love for the country etc….
IV. NATURAL / PHYSICAL ENVIRONMENT:
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Pollution [ Air, water, soil, sound ]
Environmentalist

10. v.
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LEGAL ENVIRONMENT:
Essential commodities act
Company’s act – 1956
Consumer’s act – 1986
Air pollution act
Indian contract act – 1872
SEBI act – 1992
IRDA – 1999
VI. GLOBAL ENVIRONMENT:
• WTO & GATT
• World bank
• UNO

11. VII. TECHNOLOGICAL / TECHNICAL ENVIRONMENT:
• R & D { Research and development }
• Product improvement & development
• Unlimited innovations
• Accelerating price of technological change
• Greater emphasis upon the regulation of
technological changes

12. VIII.DEMOGRAPHIC ENVIRONMENT:
 Population or individual:
• Age
• Gender
• Religion
• Caste
• Income level
• Literacy
• Marital status
• Family size
• Educational background
• Life style
• Nationality
• Language
 FAMILY LIFE CYCLE – [Various stages in family]

13. INTERNATIONAL MARKETING
Factors influencing international marketing
environment:
I. Social factors:
a.
b.
c.
d.
e.
f.
g.
National legal regime
Political situation
Financial system
Marketing infra – structure
Culture
Language
Climate

14. II. Economic factors:
a. Commercial policies variables
b. Tariffs
c. Quota’s
d. Licensing, non- tariffs barriers
e. Currency restrictions
f. Internal demand management policies and
instruments
III. Competition:
• Producers in the importing country
• Exporters from the competing countries
• Other exporters from one’s own country

15. IV. Logistics:
• Availability of required type of transport
• Cost of transportation
V.
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Risk:
Political & commercial risk
Acts of god / natural calamities
Acts of enemies, pirates
Thief's

16. SCOPE OF INTERNATIONAL MARKETING:
1. Opening a branch / subsidiary abroad
2. Negotiating / licensing/ franchising / patent’s
arrangements
3. Establishing joint ventures in foreign countries
for manufacturing or marketing
4. Sub- contracting
5. Importing for export production

17. BASIC REASON’S FOR INTERNATIONAL MARKETING:
1. Market saturation
2. Threat of trade deficit
3. Fears foreign competition
4. Raise of new markets
5. Opportunities through foreign aid program
OTHER REASONS:
• To utilize full capacity
• To offset the business out terms
• To effect savings in cost
• To take advantage of cost concessions
• To develop & fest new products
• To have access to international technology, rawmaterial & economic groups.