A business has to trade with the external world to make profit, thus external factors can have great impacts on a company’s business model. I’d like to take the First Nation issue as an example to analysis its impacts on the hydroelectric business in Canada.

The BC Hydro’s $8-billion Site C hydroelectric megaproject meets with opposition from the First Nation people in B.C (O’NEIL).

We can see First Nation people’s opposition on the project as an industry force, because it actually block the company’s access to its supply of input, so it can’t get the key resources needed by its key activities and value proposition. What’s more, B.C. have to bear the losses of delaying its project.

First Nation issue can also create regulatory trend and societal&cultural trend. The company may be forced by the government to improve their ways of production to reduce the damage to environment in aborigines region and may also face negative comments and lawsuit from advocators of aborigines and environmentalist. These factors can affect the cost structure by  increasing the company’s production, advertising and legal cost.

Considering the First Nation group is only a small part of the whole economy and is relatively isolated, plus B.C. Hydro’s product has high necessity and small elasticity of demand. My analysis shows that the First Nation issue will not significantly cause macro economic or market force that can greatly affect demand for the company goods and services very.

Bibliography

O’NEIL, PETER. First Nation chiefs to stage Site C showdown. 18 09 2014. 6 10 2014 <http://www.vancouversun.com/news/First+Nation+chiefs+stage+Site+showdown/10215965/story.html>.