External Threat Examples


Businesses have two types of environments: internal and external. Internal environments are controlled by the company, and may include elements such as organizational structure and workforce. External environments, however, exist outside of the company and are not within its range of control. As such, businesses may be vulnerable to the many threats that external environments can pose.

Economic Threats

  • According to Bank of Biz/ed, the economy can be considered an external threat to businesses because, no matter how hard a company works or how good its products are, economic conditions dictate a business's profit and success. Economic downturns can decrease the demand for goods or services on the consumer market. On the other hand, a robust economy will inspire more consumer spending and business growth. According to the Economic Development Research and Training Center, studying economic trends, such as household spending or consumer demand reports, can help companies track economic patterns in their external environments.


  • Competition is a significant external threat to businesses and is a product of the marketplace. A competitive market requires knowing who your competitors are. Competition serves as an external threat because businesses compete with other organizations for the same customers. In turn, this challenge can cause one company to flourish and the other to flop.

Global Environment

  • The global environment can be risky for companies that rely on horticulture, agriculture or other types of natural resources. Weather patterns are examples of global environmental threats that can impact a company’s resources, projects and profitability. Businesses track and trend weather patterns and global changes to monitor what types of environmental risks are out there.

Political Factors

  • According to a November 2007 article in BBC News, political decisions or changes can threaten businesses. Foreign investments, for instance, can be threatened by political decisions to go to war with other countries. Or government-funded agencies xccan have their businesses impacted by budget cuts or budget deficits.

New Technology

  • The technological field, with all of its advancements, can serve as a potential external threat to businesses. Technological changes can give companies a competitive advantage, leaving others behind. For instance, travel agencies were exposed to a technological threat when the Internet gave customers the ability to do their own research and make their own travel plans from their computers, thereby eliminating the need for travel agencies. Technological changes should be monitored to determine if there are any direct threats to a business.

Related Searches


  • Photo Credit chart with arrows image by timur1970 from Fotolia.com
Promoted By Zergnet


You May Also Like

  • External & Internal SWOT Analysis

    A SWOT analysis is a strategic management tool meant to help a business conceptualize different facets of its own operations. The term...

  • Example of a Business Risk

    There are many types of risks that permeate the business world. Internal and external barriers and challenges can arise unexpectedly and hinder...

  • SWOT Analysis of a College

    A strengths, weaknesses, opportunities and threats analysis is a tool used in businesses and other organizations to assess the potential upsides and...

  • Nonprofit SWOT Analysis

    Nonprofits operate in an increasingly competitive environment. The demand for their services always outstrips the money available to support their causes. Therefore,...

  • Cafe SWOT Analysis

    A cafe SWOT analysis can help you identify lucrative customers, overcome a competing coffee shop and strengthen your marketing plan. SWOT stands...

  • How to Analyze Key Industry Trends & External Trends

    There are two major schools of thought regarding investment analysis: technical and fundamental. Technical analysis looks at historical trends in price and...

  • Summary of Strategic Management

    Strategic management consists of internal and external analysis, strategy formulation, implementation and evaluation. A strategic approach is important because firms must constantly...

  • SWOT Restaurants

    A SWOT analysis is used as an informational tool and typically incorporated into corporate business plans. For example, if I was proposing...

  • The Steps for Overcoming Threats in a Business

    For strategic planning and development, a business analyzes its strengths, weaknesses, opportunities and threats known as, "SWOT." A business developing a plan...

  • Examples of a SWOT Analysis

    A SWOT analysis is a method used in business planning. It is a summary of the company’s current situation. The strengths and...

Related Searches

Check It Out

Are You Really Getting A Deal From Discount Stores?

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!