Pestle Analysis

Topics: Coffee, Starbucks, Coffeehouse Pages: 8 (2622 words) Published: February 11, 2013
4.1 Macro Environment
The General Environment is analyzed with opportunities and threats identified in PESTEL model of macro environment. This framework primarily involves the following two areas 1. The environmental factors affecting the organization

2. The important factors relevant in the present context and in the years to come. Please see Table 4.1 with the summarized key Macro Environment analysis Table 4.1 General Environment Analysis

PESTLE elements | Description of framework elements| Identification of opportunities (O) and threats (T) | Political | * Government stability * Political values and beliefs shaping policies * Regulations towards trade and global business * Taxation policies| O TO/TT| Economic | * GNP trends * Interest rates/ savings rates * Money supply * Inflation rates * Unemployment * Disposable income * Business cycles * Trade deficit/surplus| O/TO/ TO/T T TO/ TOO/T| Social | * Population demographics * Social mobility * Lifestyle changes * Attitude to work and leisure * Education-spread or erosion of standards * Health and fitness awareness * Multiple income families| O/TOOOO/TOO| Technology | * Biotechnology * Process innovation * Digital revolution * Government spending on research * Govt and industry focus on technological efforts * New discoveries/development * Speed of technology transfer| OOOT/O OOO| Legal | * Employment law * Health and safety * Product safety * Food laws * Environmental laws| T TO TOO | Environment| * Disposal of hazardous materials * Designs and procurement of green materials and chemicals. | O/T T/O | Adapted from: Sam Mishra, Strategic Case Analysis: Business Concepts, Strategy Frameworks, and Solved Cases as Socratic Dialogues, Booksurge Llc, 2007, Created by:__________________________

4.1.1 Political
* Government stability is reflected as the recently changed democratic government in USA permits more substitution of US role in demanding peace, and alleging forces in the war against terror. Newly elected US democratic party government means alterations in authority style * Political values and beliefs shaping policies in US has strengthen her international relations and binds to rendezvous with all countries world wide. Recent alterations in US government proved to be more effective on allowance expending and to discourage irresponsible companies * Regulations towards trade and global business are a threat to underperforming companies, requiring a bailout will sway administration grade and shareholders incentives. However, Starbucks preserves a safe financial position which favors by the fact that democratic government is gaining stability which in turn supports workers welfare policies. * Taxation policies are threat to Starbucks as new laws are meant to stop the misuse of tax covers and offshore levy heavens to organizations. The franchise and company owned operations with in or outside US will get a favorable environment in present political scenarios.. 4.1.2 Economic

* GNP shows downward trend for past 3 years, and interest rates are decreasing constantly in order to maintain the credit ratings. It is affecting the luxury items and entertainment sectors in the first place, but the regular purchasing like Starbucks products are not affected significantly. * High unemployment rate, decrease of occupations, and numerous little businesses close down decreases the money supply in the region. * Inflation keep on rising due to ever high oil prices and high discount rates, it is difficult to maintain prices for the companies. Starbucks will have to acquire cost saving structures, for construction and extension of new owned outlets. Their raw material shipment, rise in coffee growers subsidies, and transportation costs will be particularly significant at geographical location with in or outside the country. Unemployment * In this...
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