OMAR

What is a Business Environment?

It is the sum of all the internal and external factors that have a significant impact on how a
company operates, how productive it is, and the strategic decisions it makes. Internal and
External factors create the overall business environment and play a crucial role in shaping
decision-making across all levels of the organization.

Essential Factors of Business Environment

There are 5 factors in the business environment. Which are Land Labor Capital Entrepreneurship
and Knowledge. I will be discussing the first 3 which are land, labor, and capital.
Land that encompasses all natural resources, such as soil, water bodies, minerals, and vegetation
utilized for economic activities.
Labor refers to the physical and mental effort exerted by individuals in the production process to
create goods and services.
Capital includes all man-made resources such as machinery, tools, buildings, equipment, and
whatever else is used in the production of goods and services.