There are many factors involved in business success. Legal, Cultural, Economical, etc. can be further broken down into more parts. It’s a good idea to consider these factors and study them thoroughly to support your plans and strategies. Here are the top 5 widely spoken economic indicators that affect business success.
1. Gross Domestic Product:
It represents the market value of all final services and goods produced within any country in a year. GDP tells you about how the country’s economy is performing as well as its size. If a country has a growing GDP with no inflation problem, then businesses withing that country would be a good option.
2. Consumer Price Index:
It is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. It measures inflation and inflation can negatively or positively affect a country’s currency, which further can tell whether it would be expensive or economical to invest in that country.
3. PMI Manufacturing and Services:
Purchasing Managers’ Index is an indicator of how healthy the manufacturing sector & service sector of a country for the period. The PMI of a country will tell you how well or poorly businesses are doing and why.
4. Employment Indicators:
This is kind of a chain reaction, if unemployment rates go up, the citizens would have less purchasing power which in turn will hurt the GDP as well as overall economic growth prospects of the country.
5. Central Bank Minutes:
Central Bank of the country determines the financial policies to govern its economy for a financial year. Going through the minutes would help you understand how future policies can affect the business.
These are a few of the many. Obviously, you cannot fully rely on just these 5, other factors should also be considered. For example Demand and Supply, Marginal and Total Utility, etc.
These 5 indicators should only act as a starting point for further research into specific fields and business niches.