The economic environment depicts the growth in the economy, the specific industry as well as the investment climate. In periods of economic growth the consumers are able to have much more disposable income. This results in them having more funds to spend on purchases. However the recent trend depicts that the UK and the US economies are going to be facing recessions in the following years to come. This means that the propensity to consume and the disposable income available to consumer in these regions will decrease overall as well as for The Body Shop products. While the economies in central, East Asia as well as in the developing countries would be facing high levels of growth resulting in higher disposable income for people residing in these regions.
The social environment that surrounds the company depends on the changes taking place in the cultural and regional environment. Aside from this social issues and trends in consumer actions can also adversely affect the performance of the company as well as the consumption pattern of the customers of the Body Shop. The trend depicts that there is a strong focus of consumer action groups towards conservation of the environment and rebuilding and supporting the economies in the developing countries. This is positive for the body shop as the company has outlined its objectives as sustaining the environment and undertaking trade programs which strengthen and support the economies of the developing countries.
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