Businesses are affected by macroeconomic factors operating in their environment; the main risk with the external influences is that the company has minimal control over them. Depending with the trend in the market, changes in macro economic factors may have positive or adverse effect on the business. The phone industry has faced negative and positive effects from macro-parameters movement.
The phone manufacturing industry is facing some changes with changes in macro-economic situation in the globe; the industry has been vested by major international companies like Apple Inc., Nokia, Samsung, and Ericson. In the next five years, the industry is expected to be affected by macro-economic factors as follows:
Population changes and growth
With increase in population, the industry is likely to have an increased number of people with varying needs and wants, with such changes, phone with different features will need to be developed that can meet the demands of the changing population. On the other hand, there have been influxes of generation Y in the country resulting to people whose needs are changing by day.
With technology changes and improvement, the world is likely to get a change on the features and applications that it is going to use in the electronics gadget. The technology changes will require that the companies making phones come up with new systems of innovating, inventing and developing their gadgets.
The trends that phone have taken show that they are tending to become smaller with more features that satisfy the customer more.
With changes in globalization, there have been changes in interaction between countries which facilitate the growth of international trade and cooperation among countries; this has yielded an increase in the number of companies working in the international states.
The increase in cooperation is likely to make the demand of phones higher and with much demand, and then there will be need for improvement of the gadgets if they have to be competitive.
Social changes and lifestyle adjustments
With changes in living standards and lifestyles, phones are likely to become more of necessity to people thus the demand of the gadget is likely to improve. With the improvement, there are chances that phone making companies will have to increase their capacity and delivery mode to meet the demands.
Despite the prospected improvement of people living styles, there is the risk that factors like global warming, global financial crisis, among other social factors will reduce people’s living standards and styles to the disadvantage of the industry (Spears, 2003).
Discussion an final remarks
The world seems to have realized the need for effective and reliable communication and transport systems; with the realization the phone industry is growing drastically, the industry is supported by change in macro-economic activities and the trend is expected to remain the same in the foreseeable future.
Increased population more so generation Y which depends on phones for their communication is working for the good of the industry.
Improved living conditions and change in business styles in another benefit that the industry is deriving; people have improving living conditions thus they are depending on phones for their communication.
Other than the above benefits that are accruing to the industry from changes in macro-economic activities, there have been changes that are working to the negative of the industry. The growth of internet and its fast acceptability among the youth is offering the industry competition, thus offering a substitute way of communication.
The phone industry is also facing a challenge from the growth of Ipads and Iphones that have become a more preferred gadget than phones. There are some surveys that are showing that use of phones have adverse effects on human beings, such researches are likely to hinder the growth of the industry (Braun, 1999).
Braun, K.(1999).Postexperience Advertising Effects on Consumer Memory. Journal of Consumer Research. 25(4), 319-32.
Spears, N. (2003). On The Use Of Time Expressions In Promoting Product Benefits: The Metaphoric And The Literal. Journal of Advertising, 32 (2),33-44.