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External Constraints on FLE

External constraints are things that may restrict or stop the company from achieving their aims. Interest Rates- these can have a massive affect on any company no matter how big or small it is. An interest rate is the amount that you are charged when paying money back that you have borrowed. So this may affect the amount of money that the park can be borrowed if a loan is needed for the new park. If the company borrows money but cannot pay it all back with the interest on top then the company that they have borrowed from may begin to take the money back in the form of property or company possessions.

Shareholders- these are the people that own shares of the company. FLE is a plc so the shareholders are the general public and are free to buy and sell shares in the company as and when they please. As a shareholder people expect dividends from their shares dividends are -the profits of the company so if the company decides to re invest their profits into the company the shareholder’s will not receive dividends this may cause them to sell on their shares if people rapidly sell the

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shares then the share price will fall and the company’s profits will drop. Also of the economy is not doing very well people may be wary of investing money into businesses in fear of losing it all so the company may not sell shares so they will lose out yet again.

Another problem with shares is that if the company isn’t doing well then people may not buy shares or people may panic and sell their shares so this will result in the share price falling and the company’s profit and value falling with it. If the company decides they want to make money through selling shares the price of the shares will affect them as they will not make as much money if the prices are low as they would if the company is powerful and making lots of money.

Laws- health and safety laws mean that the business must ensure that rides are checked regularly and the standards are kept at a high level all the time to ensure the safety of the visitors and the workers ion the park. They will also have to ensure that all the staff are trained to a high standard so that they are capable of looking after the rides and that only a certain number of visitors are in the park at any one time so that the amount of staff is sufficient to effectively make the park safe for all of them. There are a lot of laws that restrict companies to who they employ how they advertise and how they pay and look after staff and how they extend their park. Whilst they are advertising for new staff they must make the adverts to both sexes i.e. they must ask for a secretary not just a female secretary or just a male secretary because this would break the sexual discriminations act. Also they can not just advertise for a Black person for a job or a White person for a job or an Asian for a job as this would go against the Race Relations Act.

Also if a man and a woman are doing the same job they must receive the same pay if they do not then FLE will go against the Equal Pay Act and the company could come up against some legal action. When the company is building new rides or a new park they have to apply to the local authorities for Planning Permission as this is a legal requirement for building buildings over a certain size and it is an easy way to get the publics opinion on new buildings and whether they think permission should have been granted. They also have to worry about their workers rights as they may affect the day to day running of the company i.e. workers have holiday rights but these rights change with age groups so when a worker asks for a holiday they have the right for it but only for a certain time.

Pressure Groups Some pressure groups may not be happy with the park because it has been built on green belt land which is a wildlife habitat or because it is too close to housing this may force the park designers to landscape in a certain way. They may also campaign for a wildlife preservation area or lake to be kept on the site of the new park so that wildlife has somewhere to stay. Or they may pressure the park into building rides in certain places so that the heights or noise of the rides don’t affect the neighbours of the park or the views around the area.

Exchange Rates An exchange rate is the value of one currency against another. In other words it is how valuable the two currency’s are against each other when you go on holiday to Spain the exchange rates are shown outside exchange bureau’s to show how many pesetas you will get for each pound you exchange. This can affect the running of FLE because if the interest rates are high then people who are visiting the country will not get a decent amount of pounds for the money they change so they will not have a lot to spend in the country this may mean that they are not able to visit the park because it s too expensive. This will also affect the running of the park i.e. purchasing of materials, rides from abroad if the exchange rate is low then FLE will have to pay the countries more money for importing goods.

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