pestal model , basically
talks about the analysis of a potential country or region on various domain for
your product or business. It is a analytic approach to develop the marketing
strategy or investment strategy, In the country or region to minimize the risk
of failure. PESTL model consist five external environment factors which can
affect the business are:-
Political
pestal model , basically talks about the analysis of a potential country or region on various domain for your product or business. It is a analytic approach to develop the marketing strategy or investment strategy, In the country or region to minimize the risk of failure. PESTL model consist five external environment factors which can affect the business are:-
Political : -
The political
Environment of the country create a lot impact on the investment . one must
carefully examine the political environment of the country in reference to the
business and product . These factors determine the extent to which a
government may influence the economy or a certain industry. [For example] a
government may impose a new tax or duty due to which entire revenue generating
structures of organizations might change. Political factors include tax
policies, Fiscal policy, trade tariffs etc. that a government may levy around
the fiscal year and it may affect the business environment (economic
environment) to a great extent.
Economical :-
Economical factor is the
main drift for the business houses to target a country/market, hence it is very
critical for business to examine the economical aspects of the country, which are
nature of economy, GDP , GDP per capita , Inflation Rate, Growth Rate, Demand
and Supply pattern etc.
Social :-
These factors scrutinize
the social environment of the market, and gauge determinants like cultural
trends, demographics, population analytics etc. for example, buying trends for
Western countries like the US where there is high demand during the Holiday
season and the High demand of gold during the marriage season in India.
Technological :-
These factors pertain to
innovations in technology that may affect the operations of the industry and
the market favorably or unfavorably. This refers to automation, research and
development and the amount of technological awareness that a market possesses.
for example if 3G enabled handset showing good return in India then it doesn't
implicate that it will show same return in US. Cause US is already using 4G enabled handset. but if we launch same 3G
enabled handset to Bangladesh, Sri-lanka, Afghanistan or some of other
technologically backward countries then it is more favorable there.
Legal :-
These factors have both
external and internal sides. There are certain laws that affect the business
environment in a certain country while there are certain policies that
companies maintain for themselves. Legal analysis takes into account both of
these angles and then charts out the strategies in light of these legislations.
For example, consumer laws, safety standards, labor laws etc
