A PESTEL analysis is a framework or tool used by marketers to analyse and monitor the macro-environmental (external marketing environment) factors that have an impact on an organization. The result of which is used to identify threats and weakness which is used in SWOT analysis. (Professional Academy n.d.)
By PESTEL, we mean –
P – Political
T – Technological
E – Environmental
L - Legal
Let’s look at each of these segments. The main problem for Wesfarmers growth in political basis is the government regulation on suppliers. The controversy arose in past had forced authority to impose limit on retailers bargaining power. At the same time after Rana Plaza incident in Bangladesh, retailers all over the world had signed into different agreements. Wesfarmers is no different and signed accord. Though it is essential for good labor environment in developing nations, it poses a limit on profit maximization policy of big companies like Wesfarmers. Good news is, Iran was able to lift its international ban and oil price had dropped. It means substantial drop in production of goods. If it can draw clever contacts with a careful analysis of future oil price, then it can reward benefits from it. But it can mean reduction of price for Coals and recent controversies like Rampal project in Bangladesh had raised question about environmental issues about energy sector business. (Chelsea 2016)
The new era of migration workers can be a good source of business. They can add cheap labor even in traditional suppliers business and Wesfarmers itself can benefit from it. At the same time it means new opportunity in market as they will prefer low price new goods. (Francesca & David 2012) When it comes to immigration, co...
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...ed rate and it is not very far when market will crave for eco friendly products. And they are often suitable for supermarkets like Gas Range Stoves, Survival Water System, Eco friendly clothing etc. Investing in such sector is difficult for small companies which a corporation as big as Wesfarmers must do. They have huge potential as market and can greatly enhance a company’s reputation. Developing nations like China, India will need more supermarkets, home ware and other products. There is lack of highly efficient product makers in local community in many cases. A company like Wesfarmers can make good acquisition of local brands and with joint cooperation design products. The last one is good for reputation and for stakeholders too. At the same time it can help to generate good profit in certain product line and consumer base that are deeply sensitive on such issues.
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