- Political factors
- Technological factors
- Economic factors
- Socio-Cultural factors
- Ecological factors
- Legal factors
A macro environment is linked closely to a general business cycle. The daily operation of any organization is influenced by many factors. Employee relations might be good, but a poor economy could spur bad production and layoffs. A macro environment is an external factor that affects an establishment.
A macro environment typically encompasses factors that businesses will not be able to control. Political conditions and technological advances are two examples of significant factors companies must adjust to when making any decisions.
Changes within social trends also decide on what is going to be sold. Responding to the needs of society on a macro level will be important as this will lead to more customers and help businesses thrive.
Technological advances within the macro environment influences employment decisions on a micro level. New technologies will lead to new processes to conduct business.
Changes within the economy - for example, taxation and interest rates - will influence the contribution of a company. While taxation and high interest rates affect supply, lower prices will lead to an increase in purchasing power.
Companies will buy more supplies when they have the funds for products and taxes, whereas companies that have the funds for products but not taxes will be limited to what they can buy.
Adjusting to the economic changes on a macro level will often be about building a positive relationship with suppliers within the micro environment. In these situations, such relationships will lead to a discount in pricing and an increase in purchasing power.