Changing Environment Factor, and Pricing Strategies Changing Environment Factor, and Pricing Strategies Government, Political, Or Governing Bodies
The United States is a long serving democracy under a congress system of government. The government has put in place a series of regulatory measures to control and monitor trade and commerce. These certainly influence and determine the choice in organisational approach and strategy. The main legal entities include the various control boards, the chamber of commerce, the stock corporation, franchising and the non stock corporations.
Influence on Organisational Choice
The various legal entities that exist in the United States market have critical influences on the manner in which any new product penetrates the market. Undeniably the muffin market in the United States has its share of competitors and Wholesome Muffins will not entirely be entering a new market. Subsequently since the objective is profit maximisation it would be better for Wholesome Muffins to establish a position above the other competitors. To achieve this, the firm will require licence permission to operate as a subsidiary. This also implies that the subsidiary will be registered and licensed under the limited liability option as well as the franchisee alternative. This has a great role in ensuring that the marketing production and growth strategy maintains a direct channel approach (Berry, 2008).
Risk Factors
Despite the identified influence of the legal entities in the chosen type of organisation, it also presents certain risks. To begin with it would be impractical to establish a place of business in the country if the government fails to cooperate and offer assistance. This could occur through unfriendly policies and standards that will lead to extra expense and cost. If the firm does not also receive political input it will not have the relevant market statistics. This means that it will fail in making the customers preference and taste (Kerin, Hartely, Berkowitz & Redelius, 2006). The lack of cooperation from the government also puts the company at the risk of intellectual property insecurity. Subsequently it will fall behind the competitors increasing its operational management and marketing costs.
Economic
The United States’ food market was hardly hit by the recent economic crisis that drove the interest rates on goods and legal tender sky high slowly eliminating the unstable and inefficient companies. The remaining companies were forced to diversify to break even. Subsequently the competition for Wholesome Muffins comprises companies that have fresh muffins as just one among their products. However, the competition still exists, and it poses great risks to the firm’s performance. However, the country is slowly recovering from the crisis and the interest rates and exchange rates have continued to decrease as the dollar continues to gain value (Kotler & Keller, 2009). The import and export tariffs are becoming friendlier as the country looks to stabilise the economy through a growth trend. Both countries use the dollar as the mode of currency, and this eliminates the effect of the monetary exchange and interest rates.
The firm can avoid the effect of possible financial problems arising from the surrounding environment by maintaining a positive balance of payments and ensuring that the company is adequately insured against any possible risks.
References
Kotler, P., & Keller, K. L. (2007). A Framework for Marketing Management (3rd ed.). Upper Saddle River, New Jersey: Pearson Prentice Hall.
Kerin, R. A., Hartely, S. W., Berkowitz, E. C. & Redelius, W. (2006). Marketing (8th Edition). New York: McGraw-Hill Companies.
Berry, T. (2008). The Plan-as-You-Go Business Plan. Berkeley: Entrepreneur Press
