Business Environment-Unit 1 (MBA Sem I)

Business Environment
Business Environment | MBA Sem 1 | RKM 1

Unit 1
Introduction Concept, Significance and Nature of Business

Environment. Types of environment, Interaction between Internal and
External environments, Nature and Structure of Economy, Techniques
for Environment Analysis, Approaches and Significance of Environment
Forecasting
Unit 2
Economic Environment
History of Economic Systems, Market, Planned and Mixed Economy,
Planning in India: Emergence and Objective; Planning Monetary Policy,
Fiscal Policy. Union Budget as instrument of growth and its Impact on
Business, Industrial Policy: Meaning Objective and Recent
Development in New Economics Policy (1991) and its Impact on
Business.
Unit 3
Politico-Legal Environment
Relationship between Business and Government, Economics, Planning,
Regulatory, Promotional and Entrepreneurial Roles of Government,
Constitutional Provisions affecting Business.An overview of major laws
affecting business, Consumerism, Social Responsibility of Business.
Unit 4
(a) Technological Environment: Factors Influencing Technological
Environment, Role and Impact of Technology on Business. Transfer of
Technology-Channels, Methods and Limitations.
(b) Demographic and Socio-Cultural Environment: Population Size,
Falling Birth Rate, Changing age structure and its impact on business,
Business and Society, Business and Culture, Culture and Organisational
Behaviour.
(c) Recent Trends in Business Environment: Case Study

Unit 5
Foreign Investment and Trade Regulation
Foreign Direct Investment, Foreign Institutional Investment, WTO and India:
an overview, Regulation of Foreign Trade, Disinvestment in Public Sector
Units.
Suggested Readings
1. Cherunilam, Francis –Business Environment, Himalaya Publishing House.
2. Paul, Justin-Business Environment, Tata McGraw Hill, New Delhi
3. Aswathappa, K., Business Environment and Strategic Management, HPH
4. Mukherjee Sampath, Economic Environment of Business.
5. I.C. Dhingra, Indian Economics: Environment and Policy, 25th ed., Sultan Chand &
Sons, New Delhi, 2012
6. SK Mishra and VK puri, 4th ed., Economic Environment of Business, Himalaya
Publishing House, Mumbai, 2011.
7. H.L. Ahuja, Economic Environment of Business-Macroeconomic Analysis, S.
Chand

Introduction Concept (1)
Business Environment
• Business – Business is the activity of making one's living or

making money by producing or buying and selling products (such
as goods and services).
• Environment – The environment can be defined as a sum total

of all the living and non-living elements and their effects which
influence human life.

Introduction Concept (2)
• No business enterprise functions in a vacuum
• Understanding the environment within which the business has to

operate is very important for running a business unit successfully
at any place.
• The environmental factors influence almost every aspect of

business, be it it’s nature, its location, the prices of products, the
distribution systems or the personnel policies.

Definition
Business Environment is defined as the total surroundings
which have a direct or indirect bearing on the functioning of
business.
It may also be defined as the set of external factors, such

as economic factors, social factors, political, legal factors,
demographic factors, technical factors etc. which are
uncontrollable in nature and affects the business decisions of
a firm.
It also includes the internal factors of the business i.e.

owners, employees and their relationship with each other
which can be controlled to some extent.

External
Factors
Internal
Factors

Features of business environment (1)
The feature of business environment can be summarized

as follows..
a. Business Environment is the sum total of all factors

external to the business firm and that greatly influence
their functioning.
b. It covers factors and forces like customers,

competitors, suppliers, government, and the social,
cultural, political, technological and legal conditions.

Features of business environment (2)
c. It also includes the internal factors of the business i.e. owners,
employees and their relationship with each other.
d. Business Environment differs from place to place, region to region

and country to country. Political conditions in India differ from those in
Pakistan
e. Taste and values cherished by people in India and china vary

considerably

Concept of Business Environment
“Business environment encompasses the climate or set

of conditions, economic, social, political or institutional
in which business operations are conducted”…Arthur M
Weimer
“Business environment constitutes the factors or

constraints that are largely if not totally, external and
beyond the control of individual business enterprise and
its management”….Richman & Copen

Survival & success of a firm depend
on two set of factors viz. the internal
factors and external factors.

Significance of Business Environment
1. Long run survival: Knowledge of business environment is
necessary for the long run survival of business units.
2. First Mover Advantage: Awareness of the environment helps an

enterprise to take advantage of early opportunities instead of losing
them to competitors
3. Early Warning Signal: Environment awareness serves as an early

warning signal and it makes a firm aware of the impending threat or
crisis so that it can take timely action FOR example (Nokia)
4. Customer Focus: Environment understanding makes the

management sensitive to the changing needs and expectations of
the customers

Nature of Business Environment

Discussions
1. Why telecom sector is under stress ?
http://economyria.com/telecom-sector-stress-explained/

1. Spectrum Cost – Is more than rest of world.
2. Adjusted gross revenue (AGR) – As per the telecom industry, the

AGR should include the revenue from core telecom operations only. As per the
Government, the AGR should include the revenue from both core and non-core
operations. The Supreme Court upheld the definition of the AGR by the
Government on 24th October 2019, so the telecom operators have to pay
Rs.1.4 lakh crores to the Government within 3 months, that is by 23rd
January 2020.
3. Cancellation of 2G licenses – In the year 2007, the Indian

Government awarded 122 telecom licenses (with bundled 2G spectrum),
without conducting auctions. In the year 2012, the Supreme Court arbitrarily
cancelled all the licenses and ordered fresh auctions. About 10 mobile
operators had to shut down operations overnight after investing billions of
dollars.

4. The entry of Jio – The entry of Jio led to intense price-wars in the
industry. There has been rapid consolidation in the market, and only 4 out of 14
players have survived the competition.

Types of Environment
• The internal environment i.e. factors internal to the firm

• The external environment i.e. factors external to the firm
Internal Environment (1)
Values for an Organisation
A value is a belief, a mission or a philosophy that is

really meaningful to the company. An example of business
value is “Customer Satisfaction” OR “Being Honest”
Every company has one or more values,

whether they are consciously aware of it or not
Fro e.g. Vodafone Group is driven by 3 values

viz. “SPEED, SIMPLICITY AND TRUST”

Value System in an Organisation
A value system is a protocol for behaviour that enhances trust,

confidence and commitment of members of the community
It goes beyond the domain of legality
It is about decent and desirable behaviour
It includes putting the community interest ahead of our own

Vision, mission and purpose

1. Management Structure & Nature
2. Internal Power Relationship
3. Human Resources
4. Company Image & Brand Equity

Macro External Business Environment
Demographic
Environment
Political Economic
Environment Environment
Forces in Macro
Environment
Social
Ecological
Cultural
Environment
Environment
Technological
Environment

Social Cultural Environment (1)
• The social cultural forces/factors of

business includes social cultural
factors like customs, traditions,
values, beliefs, poverty, literacy, life
expectancy rate etc.
• The social structure and the values

that a society cherishes have a
considerable influence on the
functioning of business firms
•For example, during festive seasons there is an increase in the

demand for the new clothes, sweets, fruits, flower, etc.

Social Cultural Environment (2)
• Due to increase in literacy rate the

consumers are becoming more
conscious of the quality of the
products
• Due to change in family composition

more nuclear families with single child
concepts have come up.
• The consumption patterns the

dressing and living styles of people
belonging to different social structures
and culture vary significantly.

Ecological Environment (1)
• The natural environment includes geographical and ecological

forces/factors that influence the business operations.
• These factors include the availability of natural resources,

weather and climatic condition, location aspect, topographical
factors
• Business is greatly influenced by the nature of natural

environment

Ecological Environment (2)
• For examples, sugar factories are set up only at those places where
sugarcane can be grown.
• It is always considered better to establish manufacturing unit near

the sources of input.
• Government’s policies to maintain ecological balance, conservation

of natural resources etc. put additional responsibility on the business
sector.

Political Environment (1)
This includes the political system, the government policies and attitude
towards the business community and the unionism.
All these aspects have a bearing on the strategies adopted by the

business firms
The stability of the government also influences business and related

activities to a great extent.

It sends a signal of strength, confidence to various interest groups and
investors.
Ideology of the political party also influences the business organisation

and its operations.
Example, Coca-Cola, a US Based beverages company had to shut down

their Indian operations in late seventies though they are back in India and
doing brisk business.
CONTROLLING
STAKE TO
INDIAN
PARTNER

The US soft-drink giant, Coca-Cola, reentered India in the 1990s after
abandoning its businesses in the late 1970s in the wake of Foreign
Exchange Regulation Act of 1973. The Act, meant to 'Indianize'
foreign companies, made it mandatory for foreign companies to dilute
their shareholdings to 40 per cent. Instead of diluting its shareholdings
to the required limit prescribed by the Act, Coca-Cola opted to
discontinue its operations in India..
• The trade union activities also influence the operation of business
enterprises
• Most of the labour unions in India are affiliated to various political parties
• Strikes, lockouts and labour disputes etc. also adversely affect the business
operations.
• In today’s competitive business environment, trade unions are now showing

great maturity and started contributing positively to the success of the
business organisation.

Technological Environment (1)
Technological environment include the methods, techniques and
approaches adopted for production of goods and services and its
distribution.
The varying technological environments of different countries affect the

designing of product.
For example, in USA and many other countries electrical appliances

are designed for 110 volts. But when these are made for India, they
have to be of 220 volts.

Technological Environment (2)
• In order to survive and grow in the market, a business has to adopt
the technological changes from time to time.
• It may be noted that scientific research for improvement and

innovation in products and services is a regular activity in most of
the big industrial organisations.
• Now a days in fact, no firm can afford to persist with the outdated
technologies

Demographic Environment (1)
• This refers to the size, density, distribution and growth rate of population.
• All these factors have a direct bearing on the demand for various goods
and services
• For example: A country with large population of children is bound to have

more demand for baby products.
• A country with the large population of senior citizens is bound to have

more demand for products related to them.

• Demands of people from the cities and rural areas is different.
• Large population in a country means the easy availability of labour force

and hence the more of labour intensive techniques of production.
• Moreover, availability of skilled labour in certain areas motivates the firms

to set up their units in such area.

• For example, the business units from US, Canada, Australia, Germany,
UK are coming to India due to easy availability of skilled manpower.
• Thus, a firm that keeps a watch on the changes on the demographic front
and reads them accurately will find opportunities knocking at its
doorsteps.

• For example, the business units from US, Canada, Australia, Germany,
UK are coming to India due to easy availability of skilled manpower.
• Thus, a firm that keeps a watch on the changes on the demographic front
and reads them accurately will find opportunities knocking at its
doorsteps.
Sept
25,
2020

Oct 12, 2020

Economic Environment (1)
• The survival and success of each and every business enterprise depend
fully on its economic environment.
• The main factors that affect the economic environment environment are:
a) Economic Conditions
b) Economic Policies
c) Economic System

Economic Conditions Includes:
• Gross domestic product

• Per capita income
• Markets for goods and services
• Availability of capital
• Foreign exchange reserve
• Growth of foreign trade
• Strength of capital market
• All these help in improving the pace of economic growth

a. Economic Policies Includes:
• These are framed by the government from time to time and include:
• Industrial policy
• Fiscal policy
• Monetary policy
• Foreign investment policy
• Export Import policy (Exim Policy)

b. Economic Policies Includes:
• The government keeps on changing these policies from time to time in

view of the developments taking place in the economic scenario,
political expediency and the changing requirement.
• Every business firm has to function strictly within the policy framework
and respond to the changes therein.

c. Economic System
The world economy is primarily governed by three types of economic

systems, viz.
• Capitalist Economy
• Socialist Economy
• Mixed Economy
India has adopted the mixed economy system which implies co-
existence of public sector and private sector.

Nature and Structure of Economy
The degree on which the economic activities are

performed result in the generation of income from
resources, this determine the standard of living and
the development of an economy.
Economy can be classified on the basis of –
• Income
• GDP
• Adjusted GNP
• Industrialization

Structure of Economy
Economic structure is a term that describes the changing
balance of output, trade, incomes and employment drawn from
different economic sectors – ranging from
• The primary sector of the economy makes the direct use of natural
resources. This includes agriculture, forestry, fishing and mining. The
primary sector is usually most important in less-developed countries.
• The secondary sector includes secondary processing of raw

materials, food manufacturing, textile manufacturing and industry.
• The tertiary sector of the economy is the service industry. Provides

services to the general population. eg: retail and wholesale sales,
transportation and distribution.
• The quaternary sector of the economy consists of intellectual
activities. eg: libraries, scientific research, education, and information
technology.
Sectors of the Industry
Although there are hundreds of different jobs or occupations
they can be classified into 4 categories:

Sectoral Composition
GVA in 2018-19 (Rupees in Crore)

S.no. Sector Constant share Current share
prices (%) prices (%)
1 Agriculture Sector 18,42,873 14.39% 26,92,433 15.87%
1.1 Agriculture,forestry & fishing 18,42,873 14.39% 26,92,433 15.87%
2 Industry Sector 40,29,782 31.46% 50,42,587 29.73%
2.1 Mining & quarrying 3,85,135 3.01% 4,57,301 2.70%
2.2 Manufacturing 23,46,216 18.32% 28,53,986 16.83%
2.3 Electricity, gas, water supply & other utility services 2,87,109 2.24% 4,52,683 2.67%
2.4 Construction 10,11,322 7.90% 12,78,617 7.54%
3 Services Sector 69,36,122 54.15% 92,26,346 54.40%
Trade, hotels, transport, communication and services related to
3.1 24,67,622 19.27% 31,57,709 18.62%
broadcasting
3.2 Financial, real estate & prof servs 27,75,970 21.67% 35,55,780 20.96%
3.3 Public Administration, defence and other services 16,92,530 13.21% 25,12,857 14.82%
GVA at basic prices 1,28,08,778 100.00% 1,69,61,365 100.00%
Source: Ministry of Statistics and Programme Implementation (2018-2019)

Occupation (Labour Force)
India: Distribution of the workforce across economic sectors from 2009 to 2019

Techniques for Environment Analysis
Definition: Environmental Analysis is described as the

process which examines all the components, internal or external, that
has an influence on the performance of the organization. The internal
components indicate the strengths and weakness of the business entity
whereas the external components represent the opportunities and
threats outside the organization.

Stages of environment analysis
Scanning • Analysing the environment for identification of the factor
which has an impact on the business
the environment to detect warning • “Identify indicators of potential environmental changes and
signals issues”
• Entails perspective follow up and in depth analysis of

Monitoring environmental trends
• “Assemble sufficient data to discern whether certain
Specific environmental trends patterns are emerging”
Forecasting • Anticipate the future to identify future threats and

opportunities
The direction of future • “Development of plausible directions to lay out the
environmental changes evolutionary path of anticipatory change”
Assessment • Draw up implications or certain impacts

• “Understanding the environment and identifying what that
Of current and future understanding of environment means for the organisation”
environment changes

Scanning: Scanning is the process of analyzing the environment for
the identification of the factors which impact on or have implications for
the business. Such factors may include those which have appeared
suddenly or evolved over the time, identification of emerging trends etc.
Monitoring: It is a perspective follow up and a more in depth analysis

of the relevant environmental trends identified at the scanning stage. The
effort here is more focussed and systematic than in scanning. The
purpose of monitoring is to assemble sufficient data to discern whether
certain patterns are emerging. However they are likely to be a complex
of discrete trends.

Forecasting: Anticipating the future is essential for identifying the
future threats and opportunities and for formulating strategic plans.
Forecasting is concerned with the development of the plausible directions,
scope, speed and intensity of environmental change, to lay out the
evolutionary path of anticipatory change.
Assessment: The purpose of environmental analysis is to assess the

impact of the environmental factors on the organizations business or their
implications for the organization. Assessment thus involves drawing up
implications/ possible impacts.

Approaches to environment analysis
There are broadly two approaches to environmental analysis:
1. Outside-in (macro) approach

2. Inside-out (micro) approach
Macro approach takes a broad view of business environment with a

long term perspective and develops alternative scenarios of the future.
The implications of the alternative scenarios for the industry and
organization are drawn up with reference to different scenarios.
Micro approach, which takes a rather narrow view of the

environment, forecasts the immediate future environment on the basis
of the ongoing environmental monitoring and derives the implications
of it for the industry and firm out of it.

Techniques for environmental Analysis
• Verbal and written information

• Search and scanning
• Spying
• Forecasting

Environmental Analysis And Forecasting Steps in
Environmental Forecasting :
1.Identification of relevant environmental variables

2.Collection of Information
3.Selection of Forecasting technique: It depends upon the
amount and accuracy of available information, cost and
expertise available.

Environmental Forecasting
Definition 1: Anticipating the future is essential for identifying the future
threats and opportunities and for formulating strategic plans. Forecasting is
concerned with the development of the plausible directions, scope, speed and
intensity of environmental change, to lay out the evolutionary path of
anticipatory change.
Definition 2: Attempting to predict the nature and intensity of the

micro environmental and macro environmental forces that are likely to
affect a firm's decision making and have an impact upon its performance in a
given period.

 Forecasting is an important aid in effective
and efficient planning. It helps management
in reducing its dependence on chance.
 Forecasting is helpful in better planning

based on assumptions about the future
course of events.

Techniques of Environmental Forecasting
There are a number of techniques through which forecasts can be made.
These techniques, singly or in combination, are used depending upon the
business situations when they have to be used.
Techniques of
forecasting
Quantitative Qualitative

Quantitative • It applies mathematical models to past and present
information to predict future outcomes. Some of the
quantitative techniques are time series analysis,
regression models and econometric models.
forecasting
• It applies when data are not available or very little

data are available. Managers use judgement,
Qualitative intuition, knowledge and skill to make effective
forecasts. Some of the qualitative techniques are jury
forecasting of executive opinion method, delphi technique, Poll
of sales force opinion method, Survey of Customers’
Buying Plans
These techniques are used for external and internal environmental

forecasting..
Quantitative Forecasting (1)
Time series analysis is used to forecast future events based on
known past events to predict data points before they are measured. E.g.
Stock market, sales forecast etc. Time-series methods make forecasts
based solely on historical patterns in the data viz. level, trends, cyclical
and seasonality.
1. Level: Is the sales history without trends

2. Trends Component: are increases or decreases in sales that continue
year after year
3. Cyclical Component: Any frequent sequence of sales above and below
the trend line lasting more than one year. Sales are often effected by
swings in general economic activity as consumers have more or less
disposable income available.
Business Environment | MBA Sem 1 | RKM

Regression analysis is widely used statistical methods to the
estimate of the relationships between a one or more independent
variables and dependent variable and then it would be used for
modeling the relationship between those variables in the future.
The Formula for Linear Regression is as below:
Y=a + bX + ∈
Where
Y – is the dependent variable

X – is the independent (explanatory) variable
a – is the intercept
b – is the slope
∈ – and is the residual (error) The difference between the observed value of the
dependent variable (y) and the predicted value (ŷ) is called the residual (e). Each data point has
one residual.
“a” in the formula is the intercept which is that value which will remain fixed
irrespective of changes in the independent variable and the term
in the formula is the slope which signifies how much variable is the
dependent variable upon independent variable.
The formula for intercept “a” and the slope “b” can be calculated per below.
a= (Σy)(Σx2) - (Σx)(Σxy)/ n(Σx2) - (Σx)2

b= n (Σxy) - (Σx)(Σy) /n(Σx2) - (Σx)2
In other words, there are three major steps in forecasting sales through
regression analysis:
1. Identify variables causally related to company sales.

2. Determine or estimate the values of these variables related to sales.
3. Derive the sales forecast from these estimates.

Econometric Model Building & Simulation is an approach uses
an equation to represent a set of relationships among sales and different
demand-determining independent variables. Then, by “plugging in” values
(or estimates) for each independent variable (that is, by “simulating” the total
situation), sales are forecast.
An econometric model is based upon an underlying theory about

relationships among a set of variables, and parameters are estimated by
statistical analysis of past data.
For example, the sales equation for a durable good can be written.
S = R + N
Where S = total sales R = replacement demand (purchases made to replace

product units going out of use, as measured by the scrappage of old units) N =
new-owner demand
Qualitative Forecasting (1)
Jury of Executive Opinion has two steps :

1. High-ranking executives estimate probable sales, and
2. An average estimate is calculated.
Executives are well informed about the industry outlook and the
company’s market position, capabilities, and marketing program.
Advantages -
1. Quick and easy way to turn out a forecast.

2. To pool the experience and judgment of well informed people.
3. Feasible approach for a young company.
4. When adequate sales and market statistics are missing.

Delphi technique is a version of the jury of executive opinion
method in which those giving opinions are selected for their “expertise”.
The Delphi method seeks to aggregate opinions from a diverse set of

experts. Steps of Delphi technique –
1. The panel of experts responds to several rounds of questionnaires

sent to them
2. The anonymous responses are aggregated and shared with the
group after each round.
3. The experts are allowed to adjust their answers in subsequent
rounds. Delphi method seeks to reach the correct response
through consensus.

Poll of sales force opinion method, often tagged “the grass-

roots approach,” individual sales personnel forecast sales for their
territories;
This approach appeals to practical sales managers because
• Forecasting responsibility is assigned to those who produce the results.
• They are the people in closet touch with market conditions. Because the
salespeople help to develop the forecast, they should have greater
confidence in quotas based upon it.
•Forecasts developed by this method are easy to break down according to

products, territories, customers, middlemen, and sales force.

Survey of Customers’ Buying Plans
 Process includes asking customers about their intentions to buy the
company’s products and services.
 Industrial marketers use this approach more than consumer-goods

marketers.
 Survey results, however, need tempering by management’ specialized

knowledge and by contemplated changes in marketing programs.

Significance of Environment Forecasting
1. Future oriented
2. Identification of critical areas
3. Reduces risk
4. Coordination
5. Effective management
6. Development of executives
7. Measures to Increase the Effectiveness of Forecasting


Business Environment-Unit 1 (MBA Sem I)

Uploaded by

Copyright:

Available Formats

Business Environment-Unit 1 (MBA Sem I)

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Business Environment-Unit 1 (MBA Sem I)

Uploaded by

Copyright:

Available Formats

Business Environment

Business Environment | MBA Sem 1 | RKM 1

Introduction Concept, Significance and Nature of Business

Business Environment | MBA Sem 1 | RKM 3

Business Environment | MBA Sem 1 | RKM 4

• Business – Business is the activity of making one's living or

• Environment – The environment can be defined as a sum total

Business Environment | MBA Sem 1 | RKM 5

• Understanding the environment within which the business has to

• The environmental factors influence almost every aspect of

Business Environment | MBA Sem 1 | RKM 6

It may also be defined as the set of external factors, such

It also includes the internal factors of the business i.e.

Business Environment | MBA Sem 1 | RKM 7

Business Environment | MBA Sem 1 | RKM 8

The feature of business environment can be summarized

a. Business Environment is the sum total of all factors

b. It covers factors and forces like customers,

Business Environment | MBA Sem 1 | RKM 9

d. Business Environment differs from place to place, region to region

e. Taste and values cherished by people in India and china vary

Business Environment | MBA Sem 1 | RKM 10

“Business environment encompasses the climate or set

“Business environment constitutes the factors or

Business Environment | MBA Sem 1 | RKM 11

Business Environment | MBA Sem 1 | RKM 12

2. First Mover Advantage: Awareness of the environment helps an

3. Early Warning Signal: Environment awareness serves as an early

4. Customer Focus: Environment understanding makes the

Business Environment | MBA Sem 1 | RKM 13

Business Environment | MBA Sem 1 | RKM 14

1. Why telecom sector is under stress ?

Business Environment | MBA Sem 1 | RKM 17

2. Adjusted gross revenue (AGR) – As per the telecom industry, the

3. Cancellation of 2G licenses – In the year 2007, the Indian

Business Environment | MBA Sem 1 | RKM 18

Business Environment | MBA Sem 1 | RKM 19

• The internal environment i.e. factors internal to the firm

A value is a belief, a mission or a philosophy that is

Every company has one or more values,

Fro e.g. Vodafone Group is driven by 3 values

Business Environment | MBA Sem 1 | RKM 21

A value system is a protocol for behaviour that enhances trust,

It goes beyond the domain of legality

It is about decent and desirable behaviour

It includes putting the community interest ahead of our own

Business Environment | MBA Sem 1 | RKM 22

Vision, mission and purpose

Business Environment | MBA Sem 1 | RKM 23

2. Internal Power Relationship

4. Company Image & Brand Equity

Business Environment | MBA Sem 1 | RKM 24

Business Environment | MBA Sem 1 | RKM 25

• The social cultural forces/factors of

• The social structure and the values

•For example, during festive seasons there is an increase in the

Business Environment | MBA Sem 1 | RKM 26

• Due to increase in literacy rate the

• Due to change in family composition

• The consumption patterns the