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    Governmental Regulations & Their Effect on Business

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    In today's competitive business climate, achieving long-term business success has become more difficult. For example, changes in technology cause the demise of technology manufacturers, and changes in the supply of oil and the resulting price of gasoline can have an impact on auto companies that focus on gas guzzlers.

    For your current employer or any company for which you have knowledge, answer the following questions:
    â?¢What are two governmental regulations that have made or may make the company less successful going forward? Explain (in detail) why.
    â?¢Is there any way that these unfavorable regulations could be turned in the company's favor and give it a competitive advantage? Be specific in your answer.

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    Solution Preview

    Cigarette companies are under fire from government regulations constantly. A new regulation in September '09 banned flavored cigarettes from being sold in the U.S. in an attempt to curb teenage smokers (http://www.statepress.com/archive/node/7890). This had a direct effect on several cigarette companies- those that sold flavored cigarettes like vanilla, cherry, and chocolate but not the two largest companies. Clove cigarettes were also banned. Menthol cigarettes, however, were not banned (and menthol represents the largest "flavored" cigarette category of all, and the two largest cigarette companies would have been effected). This ban makes a ...

    Solution Summary

    This solution discusses several governmental regulations that negatively effect company operations. However, it also discusses the opportunity to turn these unfavorable regulations into a positive factor for the company and make it a competitive advantage. The solution includes links and examples.