PEST Analysis : PEST Analysis www.soopertutorials.com
PEST Analysis : PEST Analysis PEST is the best technique for scanning of macro level environment which include political, economic, social and technological factors.
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Political Factors : Political Factors Political factors are the rules, regulation, constraints and condition made by government. Organization doing business in country must be agreed upon the term and condition enforced by Government.
Some examples of political factors includes- Taxes on product and services- Employment laws- Tariffs- Trade- Political Stability- Government policy on economy
Economic Factors : Economic Factors Economics factors are important to know the purchasing power of people, stability of economy. Fluctuation in economy impact prices of product and services organization offers to their customers. These issues are important in third world country because during recession and depression demand goes down.
Some examples of economic factors are- Higher the interest rate lowers the investment.- Economic growth in terms of GDP- Inflation rate- Exchange rates
Social Factors : Social Factors Organizations must evaluate social factors of the country before starting business. Social factors include relationship, ethnic groups, religion, age distribution and others.
For example- If marketers does not knows the social values of woman in society and start advertising campaign of woman undergarments.
- Offering products for young people at a place where the majority of people are above 40 years.
Technology factors : Technology factors Technology is now become the part of majority of organization. Technology is driving the business and improves quality and reduces time to market of product and services. In industry where the technology change with fast pace make it difficulty for the organization to adopt due to cost and human resource issues.
Some technology factors are- Research & Development activity- Automation- Technology incentive- Rate of technology change- Technological shifts
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