Internal And External Influence Amazon

In the ever changing business environment, there are both internal and external influences which affect the operations and management of a business. It is up to the business on how they deal with the effects of each influence and this will ultimately determine the success of the company. The internal influences are factors which the business has direct control over, one of these being the location.

The location refers to the geographical situation of the business and has a high level of impact over how the business will function. It can become a make or break factor, depending on how well the business utilises and addresses the visibility, cost and their proximity to suppliers, customers and to support services. The importance of the physical

This is having a positive impact as by expanding their business and locating in Australia they are attracting more consumers. According to Morgan Stanley, prior to their expansion, Amazon already had $1 billion in sales in Australia. Amazon attracts consumers through their promises of low prices, vast variety and fast delivery and thus their market share in the Australian retail sector is expected to grow significantly. Despite their promises, fast delivery is not the easiest thing to do in Australia. Location has also had a negative impact on Amazon due to the large geographical spread of Australia. As Amazon have only been operating in Australia for a few months, it will take time for them to become steadily established as well as have purchased enough fulfillment centres to operate at a similar pace of other countries. Amazon has begun with one fulfillment centre in Eastern Melbourne, where all their products are prepared for shipment at the one location. This creates higher shipping costs as it being exported from the one location. As you can see on the table, main cities in Australia are receiving their products a lot faster than consumers in rural areas. Amazon has chosen to respond to this issue by purchasing land which holds as much

Without competition, companies would not have the need to adjust their prices, or improve their products to win over customers, resulting in low quality goods & services with high prices. Competition generally has a positive impact on the consumers, as when companies begin to strive to be the best and most successful in their industry, they utilise marketing strategies to win over customers, these include but are not limited to price, product, promotion and place. Two companies which are continually constructing innovative ideas to come out on top are PepsiCo and Coca-Cola. These two companies hold the majority of the market power in the non-alcoholic beverage industry. They are classified as an oligopoly concentration as the two firms control the vast majority of the market share and therefore requires the two companies to compete on prices as well as non-price related aspects. This can be considered a negative impact on both companies as due to the similarity in their products, price wars are often triggered as consumers will tend to purchase the cheap option. With lowering the prices both PepsiCo and Coca-Cola are losing potential sale revenues and thus profits. Once the price wars come to a stand still, the businesses look for alternative marketing strategies to get an upperhand, such as products. To respond to this rivalry, PepsiCo has recently expanded their beverage