This proposal focuses on the exploration of possible business opportunities for Becky’s Cottage Floral, which distributes flowers and plants. Being a small business in the floral industry, the store has a number of factors that underscore its business capacities – such as a stable network of customers, convenient location, and a diverse inventory of flowers (Becky’s Cottage Floral, n.d.). However, the fierce competition in the floral industry and the changing preferences in purchasing processes determine the need for new business opportunities, such as enhancing delivery services, utilizing Internet opportunities, and greater communication with customers. This proposal will present specific recommendations on increasing the competitive advantage of Becky’s Cottage Floral based on the number of analyses of the internal and external environment.
PESTLE
The review of PESTLE developments is handled by a researcher of current trends in the US economy in general, and specifically, the floral industry. The available sources are comprised of the literature on recent innovations in the sphere of flower production and articles by news media on the recent events in the economic and political spheres. The order of importance of developments is decided by the researcher who conducts the analysis as well as the experts who share their insight on current tendencies. The overall amount of time spent on the preparation of the PESTLE analysis constituted five hours. The end statement, which will include the results of the analysis will take the form of the proposal to Becky’s Cottage Floral, which is based on the results of the analysis of the external environment.
The current political environment is generally favorable towards small businesses. One of the cornerstones of the Biden’s Administration policy is the planned increase in corporate taxes. However, the reason why this plan is appealing to small businesses is that the new rate will not impact them, as the Inflation Reduction Act generally targets high-profiting corporations (Buttle, 2022). Furthermore, this year has been marked by unprecedented contracting to small businesses (Biden-Harris Administration, 2022). These events signify an important political trend, in which the current Administration creates favorable conditions for owners of small business, which will likely continue in the next three years.
The current economic environment is turbulent due to two major factors. The first one is inflation, which has grown from 7.5% in January to 9.1% in July and is currently 8.3% (United States inflation rate, 2022). Such a high rate means lower purchasing power and greater pressure on businesses to increase their prices. The second factor is the slowing rate of growth of the US economy. Despite successful recovery from the pandemic-related recession, the growing inflation has caused the Federal Reserve to tighten its monetary policy (Hodge, 2022). The less money there is in circulation, the less goods and services customers can buy, which will inevitably negatively affect small businesses’ income.
The social environment is also favorable towards the owners of floral businesses. Although the US demographic is extremely diverse, the general perception of flowers in the American culture is positive. Flowers are an important component of numerous social traditions, such as weddings, funerals, celebrations, and other civic activities. Furthermore, flowers have large significance for daily activities, which range from satisfying one’s aesthetic desires and improving the quality of air to constituting an essential element in courtship. The primary audience of floral businesses are women, who comprise an extremely large demographic. As a result, the demand for flowers is relevant and will continue to be so in the future.
The technological environment presents a number of opportunities for the development of floral businesses. First, innovations have resolved the major problem surrounding flowers – their short lifespan. Flowers are not flexible as a product, since they have a short amount of time during which they can be sold after they have been cut. As a result, floral businesses are dependent on the supply flowers from locations that are in close proximity. However, logistical innovations, such as the use of light stimuli and temperature-controlled shipping prolong flowers’ lifespan (Horibe, 2020). As a result, it is possible to transport flowers between distant regions. Floral businesses can benefit due to the opportunity to expand their merchandize with rare flowers, thus increasing customer interest.
Second, technology has considerably influenced the nature of how business is conducted. The advancement of online services and a growing demand for fast and varied delivery have lifted the necessity for a customer to be physically present in the store. Businesses that utilize the Internet technology gain access to a larger audience. Moreover, the demand for delivery also implies more profit-making opportunities for entities that sell physical goods. Finally, the use of Internet allows businesses to directly communicate with customers and increase brand awareness via advertising, reposting on social networks, and implementing special offers via a business app. Combined with the use of new logistical solutions for flower preservation, Internet-based opportunities provide floral businesses with large growth potential.
The environmental factors have a dual impact on the prospects of floral businesses. On the one hand, the floral industry has no scarcity of materials – the soil appropriate for growing plants and flowers is abundant. Climate change may also have a positive impact on northern regions, making the land there more hospitable for seed growth. From this viewpoint, the floral industry will continue to thrive in the coming decades, as long as the rising temperature does not stop the already warm regions from cultivating cultures. On the other hand, the production and transportation of flowers are not always environmentally friendly at all. First, it is a common practice to among flower growers to use pesticides. Large amounts of chemicals are leaked into the soil, polluting the groundwater, potentially negatively affecting the fertility of the soil (Pereira et al., 2021). Second, large volumes of transportation lead to large volumes of carbon emissions, which also have a negative long-term impact on the floral industry. However, these factors will not impact the floral industry in the short term perspective unless they cause policymakers to implement legal restrictions.
The legal environment places a number of requirements on floral businesses. Flowers are specific products with a distinct smell and other physical characteristics, which may differently impact customers. The US laws are extremely attentive towards the protection of customer rights. Some customers may have an allergic reaction to certain flowers and chemicals used to grow them. Owners of floral businesses have to meet a number of legal requirements, such as ensuring the proper quality of products that are placed on the counter and shipped to customers. Overall, the legal environment provides favorable conditions for floral businesses as long as they comply with all regulations.
References
Becky’s Cottage Floral (n.d.). Web.
Biden-Harris Administration awards record-breaking $154.2 billion in contracting to small businesses (2022). Web.
Buttle, R. (2022). Experts agree: The Inflation Reduction Act accomplishes a lot for small business and working families. Forbes. Web.
Hodge, A. (2022). The US economy’s inflation challenge. International Monetary Fund. Web.
Horibe, T. (2020). Use of light stimuli as a postharvest technology for cut flowers. Frontiers in Plant Science, 11, 1-8. Web.
Pereira, P. C., Parente, C. E., Carvalho, G. O., Torres, J. P., Meire, R. O., Dorneles, P. R., & Malm, O. (2021). A review on pesticides in flower production: A push to reduce human exposure and environmental contamination. Environmental Pollution, 289, 1-18. Web.
United States inflation rate (2022). Web.