It is important that we are aware of how the economic environment affects the businesses that operate within it, how the changes in the economy can cause an organisation to fail or push it forward, depending on how quickly this business can change and adapt to a new environment. If this business can make the most of a bad situation, or end up collapsing under the pressure.
In any country, the economy is far from stable, and can be thrown off balance at any time, and sometimes without warning. In some the cases the effects of a declining economy can be limited to one region or country, in other cases however, the effects can be far reaching and devastating, for example the Credit-Crunch, which had effects on banks, businesses and even individuals all over the world.
A good example of a company affected by the changing economic environment in the UK is Marks & Spencer's. I believe the recession has affected all businesses in the UK, in every industry, whether they are big or small, they have been affected by this recession. And even though Marks & Spencer's is an international organisation, it was still not safe from the effects. M&S was forced to close 27 stores in the UK!! This drastic measure followed their announcement of their worst sales performance in a decade, with a drop of 7.1% in their sales in the run-up to Christmas. I think this happened because it became more difficult to attract customers because people were trying to save money. And it may be cheaper to buy their clothes or food from other retailers such as ASDA because they are cheaper. Unfortunately, the damage did not stop there; many of their surviving stores were forced to change into small Simply Food shops, as well as decreasing their prices to attract cash strapped customers.
The second company that I will focus on is Aldi. Aldi is based in Germany, where the economic