Executive Summary
The article “Jobs boom wipes out Covid losses” examines the positive dynamics in the labor market recovery. The key takeaway is the reduction in the unemployment rate from 6.3% to 5.8%, with an expectation to lower it to the level below 5%. The other positive tendency discussed is the decrease in the number of people who receive JobSeeker and Youth Allowance payments by 0.3 million. In addition, the article states that 10 jobs were created in February, 8 of which accounted for women that is also beneficial for the current state of affairs. Although the situation is worse than the pre-pandemic one, the labor market’s future perspectives’ expectations are positive.
Introduction
Small and large businesses have been influenced by the lockdown’s consequences. Despite being a negative situation, it resulted in various changes, many of which are potentially beneficial for the contemporary world in general. The instance of a business positively affected by the pandemic is the “picnic boat” one, owned by Alistair Sutherland. He claims that since the second lockdown at Melbourne, followed by summer, his company earned two or three times more than in the previous season. The owner had to hire additional staff to fulfill extra demand, lowering the unemployment rate. This one of many instances shows that new challenges result in opportunities, which eventually may make economics stronger.
Identification and Analysis of Micro Environmental Factors
Every business’ functioning can be examined within the macro and micro environmental levels. There are various factors that influence the mentioned business, and it is possible to evaluate their monetary and non-monetary impact and characterize it as positive or negative ones. It is necessary to outline all of them to provide a comprehensive understanding. Customers, intermediaries, suppliers, the public, and competitors, and parts of the external business environment should be considered during a business examination. The most significant factor in terms of its impact on enterprises is customers. For the mentioned business, customers and individual users, which take boats for personal needs and create 100% of direct income, the enterprise obtains. In current satiation, the number of customers has grown, which shows the positive dynamics of this factor.
Suppliers are the second factor of great importance, and to the business, they are boat providers, which create the cost of initial expenses. Providers of boats influence the safety and experience users will have, so this part of the external business environment should be taken into consideration. Suppliers cause an indirect impact on an enterprise’s income, as the quality of boats provided will influence future financial impact from service providing. Intermediaries, which are the next factor, are marketing services in the described case, and they have non-monetary influence. There is no necessity for the distributors, as the company does not provide products but the service. In addition, the enterprise is a local one, and the flow of consumers is ensured through online advertisement and banners, which make mass media unnecessary.
The next factor is competitors that can only be local ones because of the business’s specificity. Therefore, there are a limited number of companies, which can provide similar services. It is possible to represent successfully an enterprise, showing consumers the difference between offers that create a competitive advantage. In the discussed case, it is likely that some companies did not survive the first lockdown, which increased the demand for boats. Public factor has a moderate impact on the business’s financial flow, mostly due to local ones, such as neighborhood residents. Because of the business’s size, there is only one individual interested in the increase of the company’s income.
Challenges and Solutions
There are risks for the discussed business functioning, which can be tracked within the external business environment. There are five forces of competition, two of which influence the enterprise more than others. Rivalry among competitors is considerable in this case, as there is a number of similar businesses, which provide the same service, while technology does not significantly affect the customers’ choice. The second major threat is new entrants, which potentially can offer better opportunities for users. It is possible to choose one of three strategies, which are proactive, reactive, and uncontrollable, to respond to the business environment. Due to the business’s specificity, the more suitable strategy is to watch and react to forces, as this market does not require aggressive actions to stimulate demand. In addition, the current state of affairs shows that business has an opportunity to grow, and there is a necessity to react accordingly.
Conclusion
The picnic boat business owned by Alistair Sutherland is an instance of successful reaction to opportunities provided by the initially challenging situation, which is the lockdown. It is possible to notice that the demand for this enterprise’s services has increased, enabling the owner to hire additional staff, lowering the unemployment rate. The most important microenvironmental factors for this business are customers and suppliers, which have monetary and non-monetary impacts accordingly. The most significant risks are rivalry among competitors and a threat of new entrants. The appropriate strategy in the current situation and taking into consideration the risks is a reactive one. Most businesses, regardless of their size, can be benefited from the pandemic crisis.
References
Jobs boom wipes out Covid losses. (2021). Nation Wide News Pty Ltd, 1-3.
Torrens University Australia (n.d.). Micro environmental factors [PowerPoint slides].