PESTEL Analysis

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PESTEL Analysis

PESTEL is useful tool for analysing opportunities and threats in the external environment of a business.

PESTEL covers six areas that would often be analysed before key decisions are made

eg whether to locate in a new market.

  1. Political

    Tax policy; Foreign trade regs; Government stability

  2. Economic

    Business cycles; GNP trend; Interest rates; Money supply; Inflation; Unemployment; Disposable Income

  3. Sociocultural

    Demographics; Income distribution; Social mobility; Lifestyles; Consumerism; Education levels

  4. Technological

    Research spending; Government focus; New discoveries; Obsolescence rates

  5. Ecological

    Environmental protection laws; Using up of raw materials; cutting edge e.g. genetically modified goods

  6. Legal

    Monopoly laws; Employment law

NotesQuizObjective Test