Different economic factors Essay Example for Free

varied economic factors EssayIn this report I am going to describe the way that Cadbury ar affected by different economic factors. I leave describe the influence of two secernate economic environments on the business activities inwardly the organisations. I depart then comp ar the chall(a)enges to selected business activities within the organisations, in two different economic environments. Recession Recession is when the gross domestic turn upput (Gross Domestic Product) falls and goes negative. The GDP represents the wealth of the sparing. When there is a time out there is a decline in business activity, everyplace to a greater extent than a few months. Employment sites, household income, business profits and investment spend all decrease while unemployment rates and the amount of bankruptcies rise because multitude begin to be more detailed with their money and are little prepared to buy high priced items, for example cars and houses. People tend to consider l ess risks when investing their money and companies also cannot really afford to be employing as many pot and this is how the unemployment rates increase. The affect of recession on Cadbury Recession go out affect Cadbury but not withal drastically.The reasons for this are that plenty entrust still continue to buy Cadbury products because they are a low priced product and still affordable to many people. The gross bargains for Cadbury may even increase during a recession because people may fall into comfort eating over the recession which would result in increased sales for Cadbury. More expensive products, for example Cadbury gift boxes and celebration cakes however, will decrease in demand and sales for these products will fall fairly drastically because they are higher(prenominal) priced than single bars so less people will be prepared to spend that amount of money in a period of recession.This will however increase the sale of small, individual bars. In a recession Cadbu ry will intimately be able to recruit people. This is because a higher percentage of people would have been made additional from their previous jobs and so they will be happy just doing a job until they find something better. They will not be as bothered if the pay rate isnt as high or if they dont pose any benefits, they will just be happy about earning money again. Therefore in recession recruitment for Cadbury would be an easy dish as a large amount of people will be smell for work.Cadbury would also be able to pay a reduced wage to rude(a) employees. Economic Growth Economic Growth is where the wealth of the increases, this can be measured by looking at the GDP (Gross Domestic Product. ) As the wealth of the economy is growing there is a higher demand for a businesss products or services. When there is an economic growth, people tend to feel more safe(p) about their jobs, their sense of job security increases and they therefore feel more comfortable about spending out lar ger amounts of their money.It is during a time of economic growth that people will be more likely to make up out a loan with a bank or buy a high priced item, for example a car because they will be confident in knowing they will be in their job further down the line. The affect of economic growth on Cadbury When the economy is growing, Cadbury will see an increased demand for their products because more people will be happier spending their money. The sale of larger, more expensive Cadbury products will also increase because people wont mind paying out more money for these, unlike they would if there was a recession.Cadbury will have more employees during this time because they will need to keep up with the demand. Recruitment however, will be a much slower process than it would in a time of recession. It will be a slow process because people are already likely to be in a job working so it will take a longer time for Cadbury to gain workers. Cadbury would then have to run a higher rate of pay than other companies in order to get people to want to work for them. Most people would stay with their current job if the pay is similar. This could be costly for Cadbury as they will have to offer as much as they can afford in order to attract people.