The impact of the economic environment

 

 

 

Global interaction is the interaction between countries economically and socially. Global interaction is basically how big companies are affected by different economies around the world. Global Interaction extremely affects EasyJet because the business service is to provide passengers with transport between different countries. This means that due to the fact that EasyJet operate worldwide to other countries, other countries economies will affect the business because certain laws affect the way Easyjet can work in that country and the demand for holidays in that country may be different. If the company is in a poor economic climate, then the demand for holidays are going to be quite low.

 

There are many reasons that the economy in other countries affects businesses including Easyjet. They are as follows:

 

Market factors: incomes, tastes and lifestyles across industrialised nations are becoming quite similar which in turn creates a potential customer base. Travel across the countries in Europe is became quite common so customers expect to be able to buy goods and services from other countries freely as well as being able to travel to the places too. The growth of internet usage makes it easier to reach target customers. This applies specifically to Easyjet because they are only an internet based company now because they no longer use travel agents. This means that they reach their customers all over Europe.

 

Cost factors: Costs to produce in certain countries are different to that of another country. This makes businesses decide to look elsewhere to develop their goods. This applies to Easyjet because they have to pay to land in certain countries and the price for this varies between countries. This may cause Easyjet to limit the amount of flights to that country if it is expensive to land as well as being unpopular among the customers.

 

Government factors: Governments in other countries make different laws and other factors affecting the business. This can include tax as well as urging companies to employ more people. For Easyjet, governments affect them by imposing taxes as well as any conflict in nearby areas. 9/11 for example would be deemed as a government factor because it was an act of terrorism and war and it meant that all flights had to be grounded for three days and more security checks would be imposed from then on.

 

The Global interaction for EasyJet has changed over the years. When the business first started, the two main business headquarters were stationed within the UK. This means, that to start off with, the company weren't very global interactive. But over the growth period, the company have expanded globally by installing other bases into countries around Europe such as Germany. This shows that the economic period helped them grow as a company.

When the economic slump period of 2008-2010 occurred, Easyjet still Globally interacted. EasyJet managed to increase passengers by liaising with a travel company called Octupustravel.com. The company included EasyJet in their travel deals around Europe which meant both companies could still make money during the slump period.