Pestel Analysis: PESTET Analysis Of A Company

PESTEL Analysis
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
E- Economic
S- Social
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

As a company, Wesfarmers have its main strength in its huge size, capital, financial management, diversification, retail supermarket section, employee retention (7 CEO in 100 years) and top employee selection. The Weakness is immobility, high expectation of shareholders concerning growth, ROE, EPS and capital return, less growth opportunity in Australia, zero experience on overseas expansion, less personal label products, weak departmental stores, adverse economic and political situation. Opportunities for Wesfarmers are huge also – focusing on niche marketing, overseas expansion, good investment opportunities in future sustainable products and venture capital, investment in its other sections alongside home ware supply and retail supermarket. But for Wesfarmers threats are many too. First, new but strong competitors Aldi, rejuvenated Woolworths, board without previous retail experience, poor NPV projects choose by managers as they have a lot of money to waste, wrong acquisition, possible disasters in overseas

At present they Coles are regularly checking 8000 product to ensure that they remain in the lowest possible price. At the same time, Wesfarmers must come out with a different segment of own individualistic product lines where they will focus on lowest profit margin. The segment can’t be big at first. But within 10 years, they can have a reasonably strong product line consisting of 1000-2000 products. Remembering the huge market capital they have, it is not a big problem. For any foreign competitors like Aldi, it is difficult to adopt local culture completely. Wesfarmers in that case have a big advantage. Supermarkets must contain products based on the region they operate and local mangers and employee must have some freedom regarding selection of these products. At the same time, they can look out for product of local entrepreneurs representing local culture and it can increase revenue. At the same time, that will be very effective as a patriotic campaign and the image developed by such step will help to further enhance its position as the no 1 conglomerate in