StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Assessment of The Economic Climate in Britain, Pertaining to Starting up a New Business - Essay Example

Cite this document
Summary
This essay presents an assessment of the impact of economic conditions of the UK on the business. Starting up a new business is a critical decision and requires assessment of conditions pertaining to factors prone to pose impact on the business operations…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER95% of users find it useful
Assessment of The Economic Climate in Britain, Pertaining to Starting up a New Business
Read Text Preview

Extract of sample "Assessment of The Economic Climate in Britain, Pertaining to Starting up a New Business"

?DISCUSSION: IN THE CURRENT ECONOMIC CLIMATE IN BRITAIN, THE RISKS OF STARTING UP A NEW BUSINESS OUTWEIGH THE BENEFITS. Starting up a new business isa critical decision and requires assessment of conditions pertaining to factors prone to pose impact on the business operations. Hence, decision to initiate business is made on the basis of the net outcome from the positive and negative impacts from affecting factors. Among large number of factors economic conditions of the country is the most important one for assessment. Underlying discussion is an assessment of the impact of economic conditions of the UK on the business. Due to global financial crises that hit most of the countries including the UK and the recovery efforts not making its way (Adair, Berry, Haran, Lloyd, and McGreal, 2009), it is being considered that doing business in UK carry greater risk than ever. Therefore, given discussed below is the discussion pertaining to impact of risks on business environment of UK. Global financial crises that erupted in the autumn 2007 in US made its way to UK and round the world in the fastest possible way. European markets including UK initially rejected the anticipated impact from US credit crunch; ignoring the downside of the risks shared and spread with investment diversification (Bourke, 2007). For instance, Bank of England’s crises expectation provided with property market comparison of UK and US was rejected in all until the crises hit investors (ibid). Nevertheless, the broadened scale of impact of the financial crises halted the global economic growth (Adair, Berry, Haran, Lloyd, and McGreal, 2009). This in impose negative implications for the entrepreneurs who are looking forward to start up their new business, as there is high risk involved in getting the required return on investment in this uncertain financial environment. Despite consistent efforts the weak performance of UK economy is still creating greater uncertainty for the people who are interested in starting their own business venture. For instance, negative signals such as UK to borrow much higher in 2012-13 as compared to previous year with almost public sector job cuts reaching 1.2 million and further 2.7 million by 2018 (HM Treasury, 2013), BOE will be required to continue pumping money in economic condition, the year (2012) closing with triple dip recession alarm with industrial production dropped by 9.8% as compared to 2011 and highest decline in 20 years (Elliot, 2012), results in imposing negative pressure on the business start ups as it seems difficult to reap considerable profits in this economic condition. On the other hand the positive signals such as growth forecast to remain 0.9% in contrast to -0.1% in 2012 and the UK job hiring pick-up (Murray, 2013), encourage the entrepreneurs to establish their own business set up as there are growth chances. Year 2013 gives mixed signals of growth such as reports of further decline in industrial production in 2013 while on the other hand, February 2013 reported permanent job hiring increased for four consecutive months in January 2013’ anticipating growth of almost 0.7% for 2013 (Murray, 2013). The decrease in the industrial production impose risk on the start up of a new venture as it reflects decrease in the supply of products and hence increase in inflation. On the other hand the growth in the employment rate is beneficial for the start up businesses as it signals more consumption on the part of the individuals. Mixed signals despite consistent efforts traces trend mainly from triple dip recession due to deepened Euro-Zone crises and increased inflation curtailing consumer demand (Elliot, 2012). Ranking of UK on Doing Business chart developed by World Bank has improved from 8th positions in 2012 to 7th position in 2013 (World Bank, 2013; Schwab, 2012). This improvement is based on the factors assessing ease of doing business; therefore, self refers that ease has been increased in order to encourage investors to initiate business and gear up economic activity. Moreover, these positive factors are also reflecting acceptance in the financial market and FTSE 100 index is trading at highs for the year (HM Treasury, 2013).Since establishing and doing business has initial concern related to establishment and operational cost; therefore, in addition to increased ease in doing business factors such as job losses reported and unemployment would also support the greater pool for picking up labor at comparatively at the lower price. This will allow the owners of the new business ventures to keep the overall cost low. Moreover, since unemployment has not surged as expected hence, business shall expect sales generation and hence more profit generation. Concluding the UK conditions where unemployment has not been as high as expected, austerity plans of government stuck and jobs being created (though in slow pace) are all dampening recovery of economy as well as local demand. Conversely the stimulus is positive from external demand. Increase in the local and external demand results in providing the new start up businesses with better operating environment leading to rise in the overall profits and returns. Therefore, it can be confidently stated the conditions to do business are much better for concerns intend to capitalise on this increasing demand. Business conduct leverage concerns from large number of factors with economy to have most dominant impact. The assessment of UK economy posing risk has been assessed in the discussion above. Exploration of economic conditions as well business conditions in UK refer business condition in UK to be less risky. However, the concerns are for demand side. Dampened UK demand and less expectation of condition to change greatly in near future of current year and even year to come requires business to focus on the demand from the external market of US and China etc. Hence, variance in risks exists in doing business in UK depends upon the business type and respective carved market. References Adair, A., Berry, J., Haran, M., Lloyd, G., and McGreal, S. (2009). ‘The Global Financial Crisis: Impact on Property Markets in the UK and Ireland’. University of Ulster Real Estate Initiative, Available from http://news.ulster.ac.uk/podcasts/ReiGlobalCrisis.pdf [Accessed 10 February 2013] Bourke, C. (2007). Feeling the Pinch. Estates Gazette. Elliot, L. (2012). ‘UK on triple-dip recession alert after industrial slowdown’. The Guardian, Available from http://www.guardian.co.uk/business/2012/dec/07/uk-triple-dip-recession-alert [Accessed 10 February 2013] HM Treasury. (2013). Forecasts for the UK economy: A comparison of independent forecasts. Available from http://www.hm-treasury.gov.uk/d/201301forecomp.pdf [Accessed 10 February 2013] Murray, C. (2013). ‘Hiring pick-up adds to signs of economic recovery’. Reuters, Available from http://uk.reuters.com/article/2013/02/08/uk-britain-jobs-recruitment-idUKLNE91700220130208 [Accessed 10 February 2013] Schwab, K. (2012). The global competitiveness report 2012-2013. Available from http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2012-13.pdf [Accessed 4March 2013] World Bank. (2013). Doing Business 2013: smarter regulations for small and medium size enterprises. Available from http://www.doingbusiness.org/~/media/GIAWB/Doing%20Business/Documents/Annual-Reports/English/DB13-full-report.pdf [Accessed 4 March 2013] Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Assessment of The Economic Climate in Britain, Pertaining to Starting Essay”, n.d.)
Assessment of The Economic Climate in Britain, Pertaining to Starting Essay. Retrieved from https://studentshare.org/macro-microeconomics/1467857-assessment-of-the-economic-climate-in-britain-pertaining-to-starting-up-a-new-business
(Assessment of The Economic Climate in Britain, Pertaining to Starting Essay)
Assessment of The Economic Climate in Britain, Pertaining to Starting Essay. https://studentshare.org/macro-microeconomics/1467857-assessment-of-the-economic-climate-in-britain-pertaining-to-starting-up-a-new-business.
“Assessment of The Economic Climate in Britain, Pertaining to Starting Essay”, n.d. https://studentshare.org/macro-microeconomics/1467857-assessment-of-the-economic-climate-in-britain-pertaining-to-starting-up-a-new-business.
  • Cited: 0 times

CHECK THESE SAMPLES OF Assessment of The Economic Climate in Britain, Pertaining to Starting up a New Business

Television Licensing Fees, The BBC and the Ofcom Regulation

Supervisor: To understand the structure of television broadcasting in britain today, and the legal and financial circumstances of the BBC it is necessary to see it in its historical context, and within the current political climate.... in britain however all wireless telegraphy was controlled by the General Post Office, so the BBC operated under licence from the General Post Office.... The reorganisation of broadcasting during the war lead to the reformatting of the services offered after the war with the inauguration of the Home Service, the World Service, the Third Service and the Light Program, In the US television broadcasting began at the new York World Fair in 1939, and was unencumbered by wartime considerations....
11 Pages (2750 words) Essay

The UK Economy

hellip; Economist would consider an ambiguous measure of the economic welfare but not necessarily those measures which exist as an approximation of the gross domestic product as well as the National income which is only achieved when the overall personal income increase.... The changes in the economic conditions of the UK market are in the various forms and they are like the changing the labor market, changing organizations and the changes in the education and the skills....
13 Pages (3250 words) Research Paper

Class Does Matter: Social Background Determines Success of Pupils

As an effort to find the remedy to this situation, the previous Labor government aimed to 'drive up the standards' through the diversification of the market and increased competition.... The essay "Class Does Matter: Social Background Determines Success of Pupils" critically analyzes the key changes in the UK governmental policies in the last two decades, to prove that social background determines the student's success and the fact that 'Class Does Matter' in UK education....
15 Pages (3750 words) Essay

A dissertation on An insight into the meaning of European identity in its versatile applications'

Whether it is Arts, Sciences, History, Cinema or business; one can't help but reflect over this focus on ‘identity', which implies that there are certain notions, qualities and thoughts.... As a student of International business, I have a deep interest in gaining real knowledge about the mechanics governing such a colossal entity of which, European identity is an integral aspect.... part from an enriching exposure to diverse knowledge streams surrounding European common interests (during my present academic career as an MA student of European business), it was my personal mission to investigate the unique factors governing identity issues of Europe and derive conclusions on how they should be applied in other regional settings such as ASEAN, Asia-Pacific Regional Forum etc....
49 Pages (12250 words) Essay

Companies Limited by Guarantee

One of the most frequently used routes for running a non-for-profit business is to establish it as a company limited by guarantee as these companies will not have either shareholders or shares but is has members.... Further, companies, whether they are limited by guarantee or by shares have to Charities under this category One of the most frequently used route for running a non-for-profit business is to establish it as a company limited by guarantee as these companies will not have either shareholders or shares but is has members....
23 Pages (5750 words) Essay

Economic Perspectives On Cultural Heritage

Though various surveys have shown that quite a large number of people to support the government's initiative in disbursing money from public fund towards the maintenance of arts; there are however certain reservations pertaining to some works of art considered by the general public as ugly (and a waste of money), and some are located in such remote places that it remains hidden from the public eye, while some 'arts' are considered to be offensive by a certain section of the general public....
37 Pages (9250 words) Research Paper

Various Ways of Creating an Invaluable Economic Storehouse of Power

The hills that are rolling would also create a precise mannerism for a drive a merely an hour to reach park of state of hanging rock including state park of the mountain of the pilot that is situated up the north.... The paper 'Various Ways of Creating an Invaluable economic Storehouse of Power' presents the term triad region which consists of a population numbering to 1....
7 Pages (1750 words) Case Study

Higher Education Policy in Australia

The notion of obtaining education for employment and career progression is relatively a new phenomenon.... in britain, the Americas, and Europe, and at last, Australia, young men were taught history, philosophy, religious studies, social sciences, rhetoric, and classics....
9 Pages (2250 words) Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us