2016 was a pivotal year for Barclays, embarking on one of its largest restructurings in history designed to make bank smaller, better capitalised, and less leveraged and more geographically anchored on its core UK and US geographic markets. The major decision to exit Africa is part of the mega restructuring. The bank had to contend with regulatory pressures as well as effects of Brexit as examples of some of the major external macro factors impacting their operational environment.
PESTLE is a business strategy tool used in strategy to analyse such macro environments and identify how future trends in the political, economic, social, technological, environmental and legal environments might impact individual organisations within an industry. Firms then study the key drivers of change behind the PESTEL factors. These key drivers of change constitute opportunities and threats in a firm’s external environment and industry which can be overcome by focussing on strengths and eliminating weaknesses. This is why PESTLE is only a starting point since other frameworks such as Porters Five Forces and SWOT have to be used in conjunction to help firms like Barclays utilise internal core competencies so as to take advantage of opportunities while neutralising threats in its industry.
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Volkswagen AG may still be the world’s second largest automaker in the world after Toyota but negative macro trends and interferences from its external environment could take a toll on the company’s performance this year drastically changing the auto landscape. Such interferences include Trumps 20% tariff threat on all EU made cars which he wants implemented by November 2018. The UK, Volkswagen’s second biggest market in Europe, recently introduced a new initiative that will end sales of diesel and petrol cars by 2040. If fully implemented, at least 50% of news cars sold in the UK must be ultra-low emissions by this date. For Volkswagen and other automakers, the threat is clear; move to electric or perish. The company has also paid more than $25bn in fines and damages related to its 2015 ‘diesel-gate’ scandal, an amount that excludes the threat of future financial compensation from civil litigation.
These are some of the macro factors looked at in this report using PESTEL and SWOT to determine how Volkswagen can leverage its internal core competences like supreme innovation, engineering, manufacturing and assembly to position itself better in the future despite adverse macro influences as well as take advantage of new macro opportunities.
The UK food retailing industry is characterized by price wars, heavy discounting and increased merger and acquisition activity as seen in the recent merger of Tesco and wholesaler Bookers Group as well as the much anticipated merger of Sainsburys and Asda (Sainsdas). While a Brexit-led lull in consumer spending has played a part in creating this state of affairs for UK supermarkets especially the Big Four, it is Aldi and to a lesser extent Lidl, who have played a massive part in shaking up the UK food retailing industry. They are the only two food retailers in the UK who have been recording double digit growth rates since 2010, during a time when sales and market shares of the Big Four were in freefall. Since 2010, Aldi has increased its market share from 1.6% to 6.8% in 2018, taking it from the 11th largest grocer to now 5th and predicted to overtake Wm Morrisons. Using Pestle, Swot, BCG Matrix and Porters Five Forces analysis, this report examines the macro environment and industry structure of the UK food retailing industry to understand the forces and trends driving competition and how Aldi has been responding. While some trends such as UK consumers continuing to trade down favour it, others such as digitisation innovations and internal weaknesses including its limited product assortment, may hamper future growth in the UK and other key markets such as the US and Australia.
2016 was a challenging year for the carbonated soft drinks (CSD) market in the US which has declined for nine straight years, largely due to a decline in soda sales, part of a long-term trend that has seen total sales and volume of sugary sodas consumed decline for 11 consecutive years, as consumer worries over use of high calorie sugars and artificial sweeteners escalate. Even sales for diet sodas, supposed to be the industry saviours, continue to dip primarily due to increased scepticism of artificial sweeteners such as aspartame, a controversial artificial sweetener often used in diet colas. Diet sodas sold by both The Coca-Cola Company and rival Pepsico posted steep volume declines last year as consumers opted for healthier options. 2016 sales for Diet Coke fell by 4.3% from the previous year while Diet Pepsi was down by 9.2%. With carbonated drinks losing market share to non-carbonated drinks especially bottled mineral water, Coca-Cola is seeking to remake its portfolio under new CEO James Quincey, with strategic emphasis being placed on what American consumers are actually drinking such as bottled water or very small mini soda cans. In the following report, we will identify the major drivers of change behind Coca Cola’s external environment looking at the general trends driving the soft drinks industry in general. This will help us understand how The Coca Cola Company can utilise its brand competencies so as to take advantage of macro environmental opportunities while at the same time neutralising emerging threats that are chipping away at its success.
Zara is a Spanish fashion brand mainly dealing in the sell of clothes and accessories in many countries. Various macro factors affect the growth of Zara such as high Spain's fast-growing economic environment, increased consumer demand to shop online, among others and using a Pestle and swot analysis, we explain how these factors have affected the growth of Zara.
While Nestle continues to perform relatively well compared to some of its rivals such as PepsiCo, and Coca Cola, it is also facing the same critical challenge facing the entire food and drinks industry; new eating habits and lifestyles in much of the developed world. Consumer-focus on healthy beverages with less sugar content is, for example, driving the decline in sugary drinks consumption in the United States. Americans are for instance so turned off by sugary drinks they are now drinking more bottled water than soda, the first time it’s happened, amidst increased concern over their impact on health and obesity levels that have risen to the highest level in the world (Purdy 2016; Sun 2017). Such trends are not going away and mark a critical transformation in core markets, presenting both opportunities and challenges for an industry that is now at a crossroad. For many food and beverage firms such as Nestle, the pressure is to respond with new innovations, build new capabilities remaking their brand portfolios either through innovative reformulations of existing products or adding new product categories in order to tackle these new food and beverage trends sweeping the industry (Kell 2017b).
This report will identify the global food and beverage trends driving Nestlé’s external market environment focussing especially on the core UK and US markets. This will help us understand how the biggest food and beverage corporation in the world can utilize its brand competencies and take advantage of macro environmental opportunities while at the same time neutralizing emerging threats that could undermine its progress.
Tesco has been the UK's most dominant supermarket for more than two decades and it is still the biggest supermarket in the UK. But all is not well with Tesco at the moment. Since 2013, the food retailing giant has posted declining UK sales. It also been losing market share in the UK from a high of 30.9% in 2012 to 827.6% as of 2018. Using Pestle, Swot and Porters Five Framework, we examine external and internal factors behind Tesco’s poor performance, such as the rise of hard discounters Aldi and Lidl, who have benefited from a significant rise in consumer frugal shopping habits since 2009. Both Aldi and Lidl have doubled their market share in five years, at the expense of the Big Four supermarkets.
Tata Motors has experienced tremendous success in the hyper competitive Indian automobile industry. Using PESTLE analysis, we are going to analyze how macro-economic factors including political, economic, social, technological and environmental issues are affecting the company. We are also going to analyze the competitive environment in the industry and how it is affecting Tata's profitability. This is followed by a SWOT analysis to examine Tata's strengths, weaknesses, opportunities and threats and how it can use external opportunities and strengths to mitigate arising threats and internal weaknesses.
The business environment affecting the clothing retail industry in the UK is made up of both the macro and micro environment. The macro environment is the most general layer of the business environment and consists of broad environmental factors that impact all organizations across all industries so firms use frameworks such as Pestel and Swot to analyse environmental factors. The starting point for analysing macro-level influences is Pestel which is used in this report to identify how both current and future trends in the political, economic, social, technological, legal and the environment impact the UK clothing retail industry as well as individual firms like Primark. This is followed by Porters five forces analysis to examine the impact of Porters five forces on Primark as well as Swot to assess how the internal strengths of Primark can be leveraged together with external opportunities to mitigate existing weaknesses and external threats from the environment.
Tesco has been the UK's most dominant supermarket for more than two decades and it is still the biggest supermarket in the UK. But all is not well with Tesco at the moment. Since 2013, the food retailing giant has posted declining UK sales. It also been losing market share in the UK from a high of 30.9% in 2012 to 827.6% as of 2018. Using Pestle, Swot and Porters Five Framework, we examine external and internal factors behind Tesco’s poor performance, such as the rise of hard discounters Aldi and Lidl, who have benefited from a significant rise in consumer frugal shopping habits since 2009. Both Aldi and Lidl have doubled their market share in five years, at the expense of the Big Four supermarkets.
