The affects that recent changes in the economy can bring, can also be treated/stopped by that of other methods, For example the idea of diversification which is the strategy to enter into a new market or industry which the business is currently not in and creating that of a new product in that market, An example of this was when Tests had gone into that of the mobile phone industry, This had allowed Tests to penetrate that of a new and growing market especially by establishing their own networks. Strategies like these have allowed businesses to hangs the fortunes for themselves in the current economic climate. This has meant that although the economy at the time may have been declining it has also helped them find ways to combat the profits problem and that ultimately economic facts will not inevitably affect profits in the long term and that businesses can deal with it, However in this point the question is that it depends on if the business has researched into enough as otherwise it could be a problem for the business as it’s a high risk high reward strategy.
However the recession has also helped businesses and in some cases actually improved the profits in the long term for the business. This is referring to those of discount retailers because money is short so consumers are likely wanting to get value for money, this is where the discount retailers have becoming a growing phenomenon like that of pound land and app store, For example in 2011 had pre-tax profits of 40 million this shows Just how largely they are being used in recession time especially getting 4 million customers per week , this Just wows how the sort of business you are will affect whether you are affected by these economic changes. Economies of scale have helped them keep the prices as they are as they have many stores to allow them to do this.
However this does depend on other external factors for example with high inflation rates on raw materials it may become increasingly hard to charge products for a pound meaning that still even businesses which can survive the recession can be affected by economic factors, however this may not influence the long term profits of the business. You can also argue that because of how the economic cycle goes that ultimately in the long term there profits won’t be damaged as after every recession even if it double dips or even triple dips there will eventually be a boom, which will be within the time period of long term therefore that ultimately economic factors may not be as effective as long as the business can save themselves from going bankrupt. Overall recent changes in the UK economy have affected that of profits of businesses especially in the short term.
However the inevitability of it all can be questioned as nothing is inevitable and that businesses will still be able to make changes to themselves to try combat economic changes, For example it depends on how the business reacts to change as them not changing will ultimately leave themselves in a worsened state, Also it depends on the industry or business that you are in as if you sell necessities like that of petrol, food etc. , you are likely to do better as you, yourselves are selling a product in demand whereas luxuries such as Cameras like that of Jeepers may have led to them failing in the first place. So it is right to assume that economic changes