Essay The Impact Of The General Environment On New Zealand Business

Essay The Impact Of The General Environment On New Zealand Business

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The general environment is likely to impact New Zealand business in the next 10-15 years. It will affect Fonterra through the outer layer of external organisational environments, such as sociocultural, economic and Global dimension in which Fonterra operates. Fonterra is a multinational dairy Co-operative group which is owned by around 13,000 New Zealand Farmers.
The sociocultural dimension of the general environment will strongly affect Fonterra in the next 10-15 years. The sociocultural dimension will affect Fonterra by the recent decline in productivity and decreasing dairy price causing a loss of 500 plus jobs within the industry many jobs being cut “Initial job losses will come mostly come from sales and support teams, but departments including R&D, health and safety and quality assurance are likely to be affected later this year” ( The Chemical Engineer, 2015) . These cuts are set to save Fonterra up to $60 million New Zealand Dollars per year by cutting the non-managerial employees. The current swelter on Fonterra with the fresh botulism scare it’s an audacious action to further cut health and safety and quality assurance setting Fonterra on a discouraging track for the up and coming 10-15 years. Cultural characteristics show the cuts of over 500 jobs shows that the company further compromise its values for safety for the benefit of saving money. This potentially could affect the company in the future by customers and employees having a change in attitude towards purchasing or being employed by Fonterra. Also having the potential to change behaviour of the consumers no longer purchasing or purchasing less of the product. While the international dairy price continuously diminishes over the last 18 months, the price of milk p...


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... (Ball, 2014). Not only does Fonterra spend its investors money overseas it also chooses to not invest that money into its own shareholder’s farms in New Zealand. Fonterra seems focusing on expansion and less on safety and adding value to the milk that they have. This will strongly negatively affect Trading and revenue for Fonterra as a business through the Global dimension of the general environment for the next 10-15 years unless there is a positive turn in the global market which looks unlikely.

In conclusion, the general environment is likely to impact the New Zealand business Fonterra in the next 10-15 years. Form research and sources It will affect Fonterra through the outer layer of external organisational environments, such as sociocultural, economic and Global dimension in which Fonterra operates it shows this by the previous, current and ongoing affects.

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