Every company which is into business has to deal with many things but the things that matter the most to the company are the micro economic factors which impact the business of the company. Given below is the list of micro economic factors –
Micro Economic Factors
- Customers – Customers are central to any company which is running a business for profit because without customer no business can survive. Hence a company should know exactly what its customer wants and also segregate customers according to needs of the customers and then offer their products to the customers
- Employees – Employees are another important micro economic factor which the company should take into account because a company can be as good as its employees. So if top management of the company is good but employees are not efficient and customer friendly then no matter how good the idea and policy of the top management of the company the idea and policy will be a failure.
- Investors – Investors are another important micro economic factor because all good companies are listed in stock market and if the company does not take care of investors’ interest than chances are investors will not invest into the company and if investors do not invest money into the company then company will not be able to grow as every company requires funds for expansion of the business.
- Competitors – In this age of competitiveness, competitors are also an important factor because if the company does not pay attention to its competitors than chances are they will eat into the business of the company. Hence company should have a proper strategy to counter any competition for both existing products as well as future products which company is planning to produce or sell.
- Suppliers – When rain does not come rivers go dry, in the same way without suppliers company will not be able to function properly because if suppliers do not provide the raw materials that company will not be able to produce the products on time leading to dissatisfaction among consumers which ultimately will lead to loss of business for the company.
- Public – General public is another important micro economic factor because many companies underestimate the power of public opinion as it takes years to build the image of the company in the minds of public but it takes very short period to damage the image of the company and sometimes it can be beyond repair leading to fall of the company.
As one can see from the above that a company should keep above micro economic factors in mind so that it can take advantage of above factors which in turn will help the company in surviving for long.