Reference no: EM133616899

Question: What are your insight regarding this article related to external economic opportunities and threats of Merchandising Business

1. Economic growth to boost PHL consumer spending in 2020. As economic growth persists and consumption level normalizes, the consumer spending outlook will be more positive. (Philstar Global, 2023).

2. According to data from the Philippine Statistics Authority (PSA), In 2016 there is 6.6% GDP Growth that spikes the Philippine retail sales with 10.6% year-on-year in the first half of 2016, a significant jump from the 6.9% growth experienced during the first half of 2015. Wholesale trade also edged upward over the same period, up 8.6% compared with the 7.7% growth registered the previous year.

3. With global growth likely to remain sluggish for the remainder of 2019, the government must exert all efforts in boosting domestic demand and exports' competitiveness to improve the Philippines' trade performance (National Economic and Development Authority, 2023).

1. Price increases lead to decreased consumer sentiment and discretionary spending. Consumers are more concerned about their debt and daily expenses than investing on discretionary items that are not good for a business and may lead to decreased revenue and issues in inventory forecasting (Ginsburg, 2023).

2. As inflation increases, interest rates also increase as this is the fighting tool of the Central Bank to combat inflation. When the interest rates are higher, it makes borrowing money more expensive, which may result in a higher cost of borrowing for working capital and for investing in the business's future (Nelson, 2022).

3. Exchange rates can pose a danger to merchandisers who import or export goods. Changes in exchange rates can have an impact on the price of imported items as well as the competitiveness of exporting goods. Unexpected changes in currency values can cause pricing strategies and profit margins to be disrupted (Hitt et al., 2021).