Dendro
Macroeconomic Factors
There are a number of macroeconomic factors that will affect Dendros, but the most important one is the overall health of the local economy. The GDP is the most oft-cited measure of broad macroeconomic health. For some in the Dendros target market, arbor services are discretionary, meaning that purchases will either be cancelled or delayed in response to downturns in the economy. The Congressional Budget Office bases its projections on the policies that are currently in place. This means that its forecast for 0.5% decline in GDP over the year from Q4 2012 to Q4 2013 has built in the provisions of the so-called "fiscal cliff." It is expected that between the present moment and January 1, 2013, new laws and policies will be enacted to replace this scenario, so the actual forecast for GDP growth is more likely to be slow growth in the range of 1.7% (CBO, 2012). The California state budget has built in a forecast of 2.5% increase in GDP, above the national average, assuming that key elements of the Budget Control Act are ultimately not enacted.
Interest rates also could affect Dendros, depending on the company's debt structure. If the debt is floating, there is the risk that if inflation and interest rates move upwards, the cost of the company's debt would also increase. However, prospects for a slow increase, or even small decrease, in the GDP reflect an environment where there would be little need to increase interest rates. Therefore, neither inflation nor interest rates are expected to be a significant risk to Dendros in 2013.
Non-Economic Factors
The social and cultural environment is generally positive. Consumers tend to appreciate arbor services, and when these services are conducted in an environmentally-friendly manner there are...
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