Answer to Question #310522 in Management for Asataluli

Question

How regulations and government influences affect retail business industry?

Answer 1

Government influences the retail business by either increasing price of licenses or increasing prices of commodities through taxation. Moreover, they also determine what goods are legal, which ones to subsidize or incentivize, or which ones to increase their taxation to discourage consumers from using them. Increasing licensing fee will discourage retailers from venturing into that business while taxation increases the prices of commodities, which discourages buyers from purchasing such goods. These activities prevent consumers from buying the good, which can make the retailer to be out of business due to lack of sales. Subsidies promotes retail business the same way incentives does. All these activities either promotes or discourages the retailers from continuing with their business.