Macroenvironment Situation

This subsection of the situation analysis section of your marketing plan describes only relevant information on macroenvironmental trends that might affect your business:

• Demographics: For example, a home-building contractor should begin to pay closer attention to the needs of people over 65 as baby boomers begin to edge closer to retirement. People are living longer and spending more on vacations, recreation, and entertainment. The Census Bureau estimates that in 2010, 13 percent (40.3 million) of the people in the U.S. were 65 or older.
• Economics/business conditions: When interest rates go up because of inflation, the government is trying to slow business growth. Money is more expensive to borrow. People may be less apt to buy new homes or cars. International trade is affected by government tariffs and local labor costs and union organizations.
• Technological: Innovation can create or wipe out industries and businesses in less than a year. The popularity and convenience of CD players all but eliminated the sale of record players and seriously depressed the manufacture and sale of vinyl records.
• Political and legal: Health care and handicapped legislation affects all businesses, large or small. Increasing costs and mandatory provisions for buildings, walkways, elevators, etc., significantly affect the overhead for a small business. For example, a new restaurant with a basement must now have an elevator (e.g., $20,000 or more) for handicapped employees, despite the unlikely circumstance of physically handicapped employees needing to go down to a basement storage area.
• Social and cultural: There is a sweeping trend for Americans (and the world) to dress more casually, with function and comfort driving new clothing and shoe trends. People are cooking less and are more concerned about nutrition and fat in their diets. And today, American business people are less willing to sacrifice family life for business careers. What does this mean for your small business?