Environmental Essay

633 words - 3 pages

Environmental Scan Essay

Environmental scanning can be viewed as a way of acquiring information about outside events that can aid organizations in first identifying potential trends, then interpreting them
(Kerin, Hartley, & Rudelius, 2010). These trends normally consist of five sources, social, economic, technological, competitive, and regulatory forces. My intention in this essay is to focus on one; the economic environmental force. I will discuss how the current state of the economy will impact completing an environmental scan. In order to evaluate how the economy will impact the completion of an environmental scan, it is essential to cover the concerns that affect the economic aspect whether people want to believe it or not.
The first concern is the macroeconomic level or factors which cannot be controlled. Leo Sun describes macroeconomic factors as national or global events which are out of people’s control ...view middle of the document...

Recession, inflation rate, or growth in spending power classifies as such factors. Since 2008, increased unemployment has made it difficult to complete an environmental scan because it leads to lower consumer spending, then reduced imports from other countries making it hard to identify and interpret these trends. As a result, “businesses decrease production, unemployment rises, and many consumers have less money to spend” (Kerin, et al., 2010, p.66).
The second concern is more of a microeconomic trend and it has to deal with the consumer income. These are equally important because as a consumer, we affect the economy with what we do or do not purchase. Overall there are three components that a consumer’s income is related to in reference to buying that give us an idea of the state of the economy and the impact of completing an environmental scan. They are the gross, disposable, and discretionary components. The gross income is the total amount of money that is made by one person, or a household. This can affect an environmental scan due to the fact that someone in a family can fired from their job or given a raise leading to a disparity in the trend. The disposable income is the money left after paying taxes. The problem is evident as described by Kerin, et al., (2010), “if taxes rise or fall faster than income consumers are likely to have more or less disposable income”(p.66). By having more or less income it makes it hard to scan and develop trends effectively. The third component is the discretionary income; what is left over when everything else is paid.
In the end, the state of the economy will undoubtedly have an effect on completing an environmental scan in large part due to the ups and downs of both what the consumers and businesses are going through just to stay on track financially. It will make it difficult because of the concerns and trends that potentially are out there.


Kerin, R. A., Hartley, S. W., & Rudelius, W. (2010). Marketing: The core (4th ed.). New York: Mcgraw-Hill Irwin.

Sun, L. (2013). Macroeconomic Factors and the Management Environment. http://www.businessdictionary.com/article/598/macroeconomic-factors-and-the-management-environment/.

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