Question

‘VBR Cinema', an Indian multiplex cinema hall was the first to recognize the change in consumption habits of people. It changed its food menu from burgers, pizza, soft drinks, etc., and switched over to healthier options like salads and smoothies, soups, and anjeer-based sweets. Within a month, the revenue of the multiplex from sale of food items doubled.
'VBR Cinema', by continuously monitoring the environment and adopting suitable business practices, was able to improve its revenues and profits and was hopeful that it will continue to succeed in the market in the long run too.
Identify and explain one dimension of business environment and one point of importance of understanding the business environment highlighted in the above case.

Hint:

Understanding the social environment helps businesses adapt to changing consumer preferences and sustain long-term success.

Answer 1

Dimension of Business Environment:
Social Environment:
The social environment of business includes social forces like customs, traditions, values, social trends, and society’s expectations from business.
Importance of Understanding the Business Environment:
It helps to improve performance:
Enterprises that continuously monitor their environment and adopt suitable business practices not only improve their current performance but also continue to succeed in the market for a longer period.