![]() The focus here is on the social environment and identifying emerging trends. Factors include interest rates, employment or unemployment rates, raw material costs and foreign exchange rates. Economic FactorsĪn economic factor has a direct impact on the economy and its performance, which in turn directly impacts on the organisation and its profitability. This would include political policy and stability as well as trade, fiscal and taxation policies too. These determine the extent to which government and government policy may impact on an organisation or a specific industry. Let’s look at each element of a PESTEL analysis. The framework is also used to identify potential threats and weaknesses which are used in a SWOT Analysis when identifying any strengths, weaknesses, opportunities and threats to a business. Organisations that successfully monitor and respond to changes in the macro-environment can differentiate from the competition and thus have a competitive advantage over others. ![]() This analysis should be repeated every six months to identify any changes in the macro-environment. In marketing, before any kind of strategy or tactical plan can be implemented, it is fundamental to conduct a full situational analysis. ![]() In this blog, we will look at what a PESTEL analysis is used for as well as the advantages and disadvantages of using it in a business setting. The letters stand for Political, Economic, Social, Technological, Environmental and Legal. A PESTEL analysis is an acronym for a tool used to identify the macro (external) forces facing an organisation.
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