BUSINESS ENVIRONMENT IN UK

Business Environment in UK

Business Environment in UK

Task 1

Poster

Free Market

Free market is an economic system in which the prices of goods and services are regulated by the supply and demand forces in the market. In a free market, the competitors or business organizations are allowed to reach equilibrium point without government intervention.

Mixed Economy

Mixed economic system is an economic system that is dependent on both private and public ownership of means of production that aim to correct market failures with the help of macroeconomic policies.

These are the two types of economic systems that come under the capitalist economic system, and the production of goods and services are based on these two economic systems according to the requirements of the economy of the country (World Socialism, 2006).

Planned Economy

Market Economy is an amalgamation of Free and Command economy, and it operates on the basis of demand and supply with little interference by the state authorities. Command Economy system is prevalent in communist countries where everything is owned by the government and privatization is a rarity.

UK follows free economic system and is ranked 14th on the Index of Economic Freedom in a recent survey conducted by The Heritage Foundation. UK's freedom Score is 74.8 in 2013 (according to Index of Economic Freedom, 2013, pp.449) increasing by 0.7 point as compared to last year. A company can easily set up their business and start operations in UK mainly due to its fair banking facilities, infrastructure and legal system.

Affect of UK's Taxation on Organisations

The organization that is taken for this paper is an automobile producing company. Currently, the country has effective economical system which provides a roam for such companies to do their business effectively in the country. The impact of taxation of the country will impact the organizations of automobile industry. For instance; the taxation will have direct impact on the profit being made by the organization.

Competition Policy

Currently, there is a large level of competition that exists between the companies running in the automobile industry of United States. The customers are both, demanding quality and price conscious. Therefore, companies in the sector should focus on providing quality along with competitive pricing. Otherwise, it would become extremely difficult for the organizations in the country to survive and competitive effectively in the market. The organizations of United Kingdom are not only facing local, but international competition. This is one of the reasons why the companies in the country are not keener to raise their prices. The international brands of automobile industry are well recognized around the globe; therefore, they have very high level of brand loyalty and customer satisfaction. The organization willing to survive in the automobile industry of United Kingdom has to offer something unique to the customers that can set a roam for competitive advantage.

The company would have a competition policy in which it will be providing car of different qualities. Some of the automobile items would be targeted towards customers belonging to the very upper class of the ...