Directorate: Curriculum FET

SUBJECT BUSINESS STUDIES GRADE 10

TERM 1 WEEK 3 HOURS 4
MAIN TOPIC BUSINESS ENVIRONMENT PAPER 1
TOPIC MARKET ENVIRONMENT
AIMS OF LESSON At the end of this lesson, you should be able to answer the following questions:
• Define/Explain the meaning of the market- environment.
• List the components of the market environment.
• Outline/Describe/Explain/Discuss the components of the market environment.
• Identify the components of the market environment from given scenarios/statements/case
studies/cartoons/pictures and motivate your answer.
• Explain/ Outline/Give examples of other organisations/civil society.
• Explain the reason why NGO’s and CBO’S form part of the market.
• Explain the meaning of opportunities and threats in a business context and give practical examples of each.
• Identify opportunities and threats from given scenarios/case studies/statements.
RESOURCES Paper based resources
• 2020 Grade 10 Business Studies Core Notes:
• Via Afrika Business Studies Grade 10 Learner's Book
• Platinum Business Studies Grade 10 Learner's Book
• Oxford Successful Business Studies Grade 10 Learner's Book
• Solutions for a Business Studies Grade 10 Learner's Book
• Focus Business Studies Grade 10 Learner's Book
INTRODUCTION • The Market Environment is the second Business Environment that will be
explained to you. The diagram shows the three Business Environments:
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Please ensure that you study the concepts below that relates to the market environment
CONCEPTS AND SKILLS Concepts Meaning
Market environment This environment exists immediately outside the business.
Consumers The final users of the product / services.
Suppliers Businesses, Individuals or agents who provide resources such as raw-
materials, products or services
Intermediaries Promote, sell and distribute products to consumers.
Competitors Businesses that who sell the same / similar products / services
Strategic allies Refer to two or more businesses working together to enable them to acquire
the lack of expertise they have from another business.
Trade unions Employee organizations that aim to improve the working conditions of the
workforce.
NGOs Refers to organisations that do not operate with a profit motive, but rather
focusses on rendering a service to the community
Regulators Organisations that ensure that the code of conduct and rules of fair business
are adhered to
Community Based Organisations (CBO) These are organisations that operates within communities with the aim of
improving the socio-economic conditions within the communities.
Middle Order Question Lower Order Question
1. Define/Explain the meaning of the market- 2. List the components of the market environment.
environment.
• It is the environment immediately outside the business. • Consumers
• Market environment surrounds the micro-environment. • Suppliers
• All powers that have a direct impact on the business • Intermediaries
• Management has no control, but can influence the • Competitors
environment • Other organisations / Civil Societies

Middle Order Question

3. Outline/Describe/Explain/Discuss the components of the market environment.

Components Explanation
Consumers • Customers / Buyers are the final users of the product /services.
• A consumer who buys products or services from a business is that business’s customer
• Consumer market can be sub-divided into markets for:
o Durable products, e.g., T.V sets, furniture
o Semi-durable products, e.g., clothing, shoes
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o Non-durable product, e.g., newspaper, food items

o Services, e.g., repairs, insurance
Suppliers • Suppliers include factories / suppliers of goods / services from whom businesses acquire / buy
goods to run their businesses.
• Individuals or agents who provide resources such as raw- materials, products or services.
• In order for a business to survive in a competitive environment the supplier must provide
the right quantity at the right time, right price and credit terms.
Intermediaries • Intermediaries / Agents who help promote, sell and distribute products to consumers.
• Bridge the gap between the manufacturer and the consumer.
• Intermediaries bring the products and services within reach of the consumer.
• Marketing intermediaries are wholesalers, retailers, spazas, agents, brokers and
representatives.
• Financial intermediaries are banks, etc.
Competitors • Competitors who sell the same / similar products / services can have a greater impact on
the market or the business. e.g., Shoprite & Pick ‘n Pay
• Analysing competitors helps management to understand the strength, weaknesses and
capabilities of competitors
• Organisations that ensure that the code of conduct and rules of fair business are
Regulators adhered to
Strategic allies • A strategic alliance is formed when two or more companies join forces to achieve a mutual
benefit.
Trade unions • Trade unions are the employee organizations that aim to improve the working conditions
of the workforce.
Lower Order Questions Middle Order Question
4. Give examples of other organisations/civil society. 5. Explain the reason why NGO’s and CBO’S form part
of the market
• Non-government organisations [NGOs]: Example - • NGO’s and CBO’s are part of the market, because
Doctors Without Borders they are also busy with trading and the public
• Regulators: Example – NERSA donate money which is used to benefit the country.
• Strategic allies: Examples – Telkom & SABC. • These organisations can also sell products/ organize
• Unions: Examples – SADTU; NAPTOSA; NUM fundraisings to use the small amount of profit for
the community.
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Middle Order Question

6. Explain the meaning of opportunities and threats in a business context and give practical examples of each.
• Opportunities: are external situations which could increase the chances a business has of selling its goods or services.
• Threat: external situation which could decrease the chances a business has of selling its goods or services.
• Management sees competition as an opportunity when consumers are made more aware of the product if it is
marketed by different companies.
• Competition be a threat, when a company sells similar products in the same area.
• A threat also exists if a business is unable to produce or to perform as desired, because of reasons outside the
business such as competition, changing government legislation or global economic trends.
• Businesses need to be pro-active and constantly develop new plans to counteract threats.
• Possible threats that a business can face (Examples):
o New competitors with lower prices
o The government that can introduce new laws/acts that can decrease trading
o Changes in the needs of taste of the buyers.

ACTIVITIES/ASSESSMENT CONSOLIDATION: SECTION B TYPE QUESTION

1.1. Explain the meaning of the term “market environment”. (4)

1.2. Explain what a strategic alliance is. (2)

1.3. Identify the components of the market environment represented in each of the following statements:
1.3.1. People or other businesses who buy the products and services of a business to satisfy their needs. (2)
1.3.2. People of businesses that play a major role in getting goods from where they are produced to consumers all
over the country. (2)
1.3.3. A supermarket discovers that another grocery store has opened at a nearby location. (2)

1.4. Explain the meaning of opportunities and threats in a business context and give practical examples of each. (6)

CONSOLIDATION • In this lesson you learnt more about the MARKET ENVIRONMENT.
• Continue to practice, study and draw mind-maps on each question to get a good understanding of the topic.
• The verbs in each question guides you how to answer the question.
VALUES • Competence: After working through the lesson plans you should be able to demonstrate the skills and knowledge
acquired, to complete the required assessments tasks successfully.