Legal Environment

Strengths, Weaknesses, Opportunities, Threats (SWOT) Analysis and product markets setting must be done at the same time. It is impossible to select exact product markets without considering skills which can impact the activity of the firm. It is not an easy task to set strengths. However the firm has to do it by itself, using internal information sources. Opportunities and threats are outside the firm, so we usually need consultants for assessing it. Threats may have different forms. Opportunities can come up in many ranges of activities, so sometimes it is hard to notice it.

Since threats and opportunities are outside the firm, we can call it external factors. The firm is affected by lot of various forces. The environment is changing constantly, so it is important to assess not only tendencies and variation, but also upcoming predicts of changes. The environment must be analysed constantly and this analysis has to be continuous and repeating process. Firm can take odds against its competitors if further changes are predicted properly. Political factors define the range of firm's activities regulation and juridical foundation.

Anyway the firm must act according to regulated laws, juridical base and other regulations directly impacting activities of the firm. Economical factors, in general, have a great influence for all companies, firms and organisations dealing with money. Economical situation in the country may have an impact on a small firm. Anyway, "Shadow" is not taking a loan from a bank to start and develop its business, so economical factor such as interest rate, should not be very topical. However our firm, like all other firms will have to pay taxes. Social factors have not strong impact for demand as economical factors.

Of course it depends how our company will manage to present themselves to the society. Technological factors have also great influence for development of the firm and activities. The process of technological revolution is constant, because technical innovations upstart very quickly. However sometimes these innovations may not have direct influence. Usually innovations touch activities of the firms positively. Economical Branch Environment. Economical branch joins the whole of organisations, which provide similar services or sell similar goods.

At the moment there are a lot of firms managing on such activities, which are different by its size and kind of production. As we know, competition is critical economic factor of market. Therefore we have constantly to gather and analyse information about competitors activities, plans, coming new competitors and their efforts to take bigger part of market. Accordingly to results we have to correct the direction of firm's activities. Trader understands prime cost as the price of buying product directly from manufacturer. Forthcoming percent of the profit has to cover the prime cost and amount collection for development.

The profit rate of "Shadow" firm will be 30 percent. It is not too difficult to determine price by this way. Price determination according to demand. In our case demand should be high and I think there will not be big danger that people will not be using our services. If we raised the price, customers would buy less or would buy at our competitors for lower price. Price determinations according to competitors. Competitors provide the same services so will have to pay attention to their prices in the market. The prices of analogical services should be a little bit lower than competitors.

Since our firm will get the products directly from manufacturers for lower prime cost than competitors, we will be able to adjust prices in the market by ourselves. However, it is not purposeful to decrease prices very much, because profit rate will decrease as well. Managing and organising has a great influence for successful development of the firm. The biggest responsibility and liberty of decision-making in our case will be for the owners of the "Shadow". The leader thinks that good managing is when all planned works are done; all the points are scored in the most effective way.

Anyway, in the individual firm the owner/boss is responsible, because it is his property. In our firm is linear structure of management. If there are not too many employees, it is easy to liaise with them in order to make control more effective and to get better information about the activities. All employees will directly under control of the owner/boss and they will be responsible for their duties. They will share the information with the boss about any faults at work, for example broken tool. Employees reports to the boss about the fault, so that he could transfer some money for repairing or buying a new one.

After that employee takes care where the tool will be repaired or bought and how long it will take. Also accountant is subordinated by the boss. He is responsible for all financial actions in the firm, prepares reports, so that the boss could settle up with tax institutions. Reports of the firm are very useful for the owner, because he can see exact financial situation every month. Thereby he sees incomings, outgoings and profit, so he can compare reports of few months and see where the firm spent most, which month was financially better and analyse information.

Clerk of the works is responsible to the owner as well. He has to prepare information about the number and format of orders. To notify the owner if there are any customers who want to negotiate with him. Furthermore clerk has to provide information about any complaints. After assessing the information, the owner has to make decisions and coordinate the activities. Therefore it is useful to use such management system, when the owner can get different information from his employees. Furthermore employees can communicate with their boss to ensure successful development of the firm.