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PEST Analysis

Honda PESTLE Analysis
BusinessManagementMarketingSWOT & PESTLE 

In-Depth PESTLE Analysis of Honda For Growth

by Shamsul January 26, 2022

PESTLE Analysis of Honda

 

Honda is a Japanese automotive manufacturing company in the world. In 1946, Takeo Fujisawa and Soichiro Honda established this company. In this article, we are going to do the PESTLE Analysis of Honda for academic purposes. Currently, it is headquartered in Minato, Tokyo, Japan. Honda is a leading motorcycle and automotive manufacturing company with a strong global presence. It operates in more than 150 countries. More than 215650 employees are working under this company and successfully managing the operations globally. Apart from motorcycles and automotive, the company is also a leading name in manufacturing internal combustion engines. Since 1959, the company has sold nearly 400 million motorcycles. The product portfolio of Honda is really vast and robust as they manufacture commercial vehicles, automobiles, robotics, motorcycles, scooters, jet engines, jet aircraft, thin-film solar cells, outboard motors, or you name it. They also manufacture electric generators and home gardening equipment.

The automotive industry is really competitive. The main rivals of Honda are Toyota, Hyundai, Tata Motors, BMW, Volkswagen, Porsche, Ford, Mercedes, Audi, and so on. In this PESTLE analysis of Honda, we will study some crucial factors like political, economic, social, technological, legal, and environmental that affect the company’s business on an international level.

Here is the complete PESTLE analysis of Honda:

Political Factors – PESTLE Analysis of Honda

Government Influence: 

Many international companies hire lobbyists to serve the brand or company. But, Honda does not have any lobbyists because the brand is very popular in every corner of the world and significantly influences governments. As a multinational automotive company, the company is operating all over the world by following the laws and rules of different countries. On the other hand, the company can take advantage of lower taxation in India and Africa for its growth.

Clash with China:

China is the world’s biggest consumer market right now, and the clash between these two countries can hurt the revenue and profit of Honda. As we mentioned above, Honda is a Japanese company, so it does not have friendly relations with China. Moreover, several countries have increased their tax rate and tariffs due to the conflict with China.

Electric Vehicles:

Environmental sustainability and clean energy is putting pressure on companies and governments. The main purpose of manufacturing electric cars is to reduce pollution or emissions. Due to this reason, the trend of electric vehicles is growing rapidly. This is the hot topic right now after the popularity of Tesla. Also, the company has introduced several models of hybrid vehicles and trying its best to manufacture electric cars.

Read Also: EMIRATES PESTLE ANALYSIS | FLY EMIRATES, FLY BETTER

Economic Factors – PESTLE Analysis of Honda

Gross Domestic Product (GDP):

In 2020, the annual revenue of Honda was 122 billion dollars, and it has decreased by 13.7 percent. The main reason for this decline is Covid-19 and the current economic recession. That is why its net profitability and annual revenue have dropped during the last two years.

Market Acuity:

Honda’s offerings are totally different in both luxury and economic markets. In Pakistani and Indian markets, the main popularity of Honda is because of its high-quality motorcycles. When it comes to cars, people think it is a luxury brand. This kind of market perception is creating problems for Honda in these markets. Due to the current economic conditions, Honda should offer good products.

Recession:

With such a vast global presence and strong portfolio, Honda is considered the most reliable brand globally. But, the pandemic, travel restrictions, shutdowns, and lockdowns have negatively impacted the brand, and its net income, sales, and revenue are decreased. But, the company is trying to reduce its unnecessary expenses in order to minimize the losses. Honda is also planning to reduce its operational as well as manufacturing costs to provide cost-effective products to customers.

Social Factors – PESTLE Analysis of Honda

Customers’ Requirements:

While buying a car from any brand, a customer looks for specific features in the vehicle. Maybe it is fuel efficiency, comfort, price, or convenience. This little thing can impact the performance and growth of the company at a high level. It is hard to fulfill every customer’s demand, but by focusing on essential features, Honda can make its customers happy.

The trend of Electric Cars:

In the sub-continent, Honda is known for its motorcycles. But in developing countries, people are shifting towards eco-friendly vehicles like electric cars. Just to fulfill the demand of these customers, Honda has launched electric scooters and planning to manufacture electric vehicles in the future. It will help the company to attract more customers from different markets who are eco-conscious. These electric scooters and cars would be great for users and society.

Original Products:

Some people, countries, or regions do not prefer imported services and items. Due to this purpose, Honda manufactures those products made with indigenous workforce and material. Honda uses the English language in all English-speaking regions to reduce the language obstacles.

Read Also: How to Create a Winning Strategy With SWOT Analysis

Technological Factors – PESTLE Analysis of Honda

Technological Upgrade:

It is hard to stay up-to-date because technology is growing daily. But, Honda is investing a considerable sum of money to stay up-to-date with the latest technology. Recently, Honda has updated and installed v-tech engines and GPS, respectively. This kind of up-gradation will take the company to new heights and help to reduce its carbon emission footprint.

Renewable Energy:

In manufacturing electric scooters, the company has utilized innovative technology. It was a mixture of various latest technologies, and the main purpose of using these technologies is to manufacture better quality products for the consumers. According to a report, Honda employs more than 60 percent clean energy in the production of its products.

Legal Factors – PESTLE Analysis of Honda

Legal Problems:

Being a global brand, the company tackles different legal issues over various problems in other countries. For example, many countries are endorsing the use of electric and hybrid cars, but they haven’t cleared any rules or regulations regarding electric vehicles so far.

Product Recall:

In order to reduce the litigation cost, the company should enhance the quality of its products, such as cars. Recently, Honda recalled more than 50000 motorcycles due to faulty brakes. Such problems can damage the image of the company. Also, the brand should focus on the prices of products in order to avoid any legality.

Environmental Factors – PESTLE Analysis of Honda

Sustainability:

The company is taking various steps and initiatives to promote environmental sustainability. By the end of 2050, the company will reduce its carbon emission to half. It is only possible when the company manufacture more electric and hybrid vehicles. It would help the company to minimize its carbon emission.

Conclusion – PESTLE Analysis of Honda

After this in-depth PESTLE analysis of Honda, we have determined that Honda has so many growth chances. The company should take a competitive advantage over competitors by making electric cars and motorcycles. 

Honda can create a strong global image by handling environmental, legal, and other sensitive issues. Honda should resolve problems before they could affect the company’s revenue and profit.

 
 

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January 26, 2022 0 comment
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PESTLE Analysis of FedEx
BusinessManagementMarketingSWOT & PESTLE 

Pestle Analysis of FedEx 2022 | Get ingenuity For Better Business

by Shamsul January 15, 2022

Pestle Analysis of FedEx 2022

 

PESTLE Analysis of FedEx investigates the brand on its corporate strategies. FedEx PESTLE Analysis inspects the different elements like political, monetary, technological, social (PEST), which affect its business alongside legitimate and ecological elements. The PESTLE Analysis features the diverse exterior situations that influence the brand’s matter. In most cases, it delivers information about the basic elements such as corporate strategies, compliance to political setups, legal requirements, and labor laws. 

PESTLE analysis is a system that is basic for organizations like FedEx, as it assists in understanding the business sector and its elements and further develops its business consistently. Readers who find such analysis interesting always prefer to have the PEST analysis because it is the best option to complete the research on financial, social, political, environmental, and other aspects. PESTLE analysis, also known as PESTEL analysis, deals with all these important factors.

Allow us to Begin the Pestle Analysis of FedEx :

Political Factors:

The political elements in the FedEx PESTLE Analysis can be clarified as follows:

FedEx works in 220 countries in the world. The political steadiness in every one of these locations is significant for their business to develop prosperously. Political instability has its own plague. It prompts financial chaos. Political or financial chaos is not a good sign for any investor. National or international investors always analyze these two factors deeply in order to find whether the conditions are normal or not. This analysis lets them find the best decision to invest the money in. On the other hand, this analysis tells them the right time or moment to appear or step back in the marketplace.

The entire inventory or supply network of the corporate sector gets hampered. The degree of defilement at each stage of the production network is also a significant component. The USA is the parent and significant market, the dollar exchange rate impacts business. Political circumstances like the Trade battle with China hampers business since FedEx has its activities present even in China. Government strength is important as well. Stable government prompts smoother tasks in business.

Read More: FedEx SWOT Analysis 2022 – A Powerful Entrepreneurship

Economic Factors | Pestle Analysis of FedEx

The following are the monetary variables in the PESTLE Analysis of FedEx:

FedEx is an organization that does business in various countries.

The economic downturn that struck the world economy, like savage rainstorms, seriously affected business activities. The business has an exceptionally cautious watch over the trade rates since it works in various areas across the world. The rate of joblessness and the work laws control the strategic choices in the business. The significant base is in the US, and hence the national approaches, expansion rates, loan fees matter a ton.

Social Factors | Pestle Analysis of FedEx

Following social variables are important to discuss FedEx PESTLE Analysis:

Society is the main theme. The social scene and digital media are critical boundaries in the present 21st century. Each firm needs to have a socially capable situation in the general public. Each move they make must be anticipated with earlier reactions from the general public. The mentality of individuals shaping this general public, their schooling level, the philosophical development, different predispositions are a few basic social elements. FedEx has acquired a decent friendly image in the general public on account of the social causes it has done for. It was on the world’s 10 best organizations list as reported by FORTUNE. Up to now, FedEx has been running a social interaction setup that is not controversial for any observer. This is the real work behind the easy success of this courier service. 

Technological Factors | Pestle Analysis of FedEx

The innovative variables in the PESTLE Analysis of FedEx are underneath:

Innovation is the main factor for success in each field of business in the present problematically competitive world. Adjusting to new innovation is important to have an additional edge over the contenders. FedEx has put abundantly in its useful innovation. Blockchain is an interesting innovation. It has incredible applications in different business fields, yet one of its significant applications is in FedEx’s supply chain, and this company has gained something similar. FedEx works with ‘the Blockchain in Transportation Alliance (BiTA)’ to see more proficient utilization of blockchain in the network.

The previous interest in innovation has given FedEx a solid economic result, and subsequently, they trust in contributing it.

Legal Factors | Pestle Analysis of FedEx

Following are the legal variables in the FedEx PESTLE Analysis:

With further developed innovations and the organizations’ considerable benefits, laws have also become stricter. Managing these organizations is similarly significant. Climate laws secure the climate. Various nations have their own arrangement of laws and FedEx needs to agree with particular laws. Safety and health laws, Consumer insurance, and online business are a couple of them. The security laws are severe in this industry. Information leak isn’t totally prevented until blockchain totally dominates; however, business is liable for the security and protection of the client and the things they transport.

Read More: REASONS TO USE SWOT & PESTLE ANALYSIS FOR BETTER MARKETING

Environmental Factors | Pestle Analysis of FedEx

In this FedEx PESTLE Analysis, we will discuss some environmental components influencing its business:

Money-related benefits are not the main objective of the organizations. They need to be perceived as environment dependable businesses. They need to fabricate a decent picture before their clients. Flights conveying merchandise need to utilize the traditional fuel. However, the on-street vehicles can be changed to electric modes. FedEx has started to install solar-oriented energy everywhere they work. This aids gain support of the public. In any case, more significantly it lessens the functional cost.

More trees are planted. Also, more activities will be paperless. There is a need to reduce the carbon footprint in order to deal with climate or global warming.

To close, the above FedEx PESTLE Analysis features the different components which affect its business management. However, this post assists with assessing the criticality of outside business factors for any brand.

This article has been investigated and created by the Content and Research Team. It has been evaluated and distributed by the Wise Lancer Team. This is only for educational purposes and academic use.

Get more details on the SWOT Analysis of FedEx and learn more about the strengths and weaknesses of this organization. 

 
 

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January 15, 2022 11 comments
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PEST
BusinessManagementMarketingSWOT & PESTLE 

The Role of PEST Analysis in Marketing

by Shamsul April 14, 2021

 

The Role of PEST Analysis in Marketing

 

Basically, the main purpose of marketing is to encourage people to purchase your product. It is a kind of creative message that is designed specifically to catch the attention of customers. The role of PEST analysis or Pestle analysis is very important in marketing. Therefore, you can consider social media and plenty of marketing platforms for advertising your product or services. Marketing is a virtual connection between the customer and business and it represents the interest of both parties. Today, marketing is all about innovation and technology because of the immense popularity of social media or digital media.

In this section, you can take the example of Steve Jobs. They hired the services of a prestigious ad agency to promote their smartphones and tablets. Due to effective marketing, they gained immense recognition from people. We have mentioned many times that you should add some important factors such as pricing, packaging, and promotion in your promotional or marketing strategy. Well, marketing is not our main topic in this article. We will discuss the role of PEST analysis in marketing because these factors are also important for your business.

Definition:

PEST is a tool to analyze the external factors of any business such as political, economic, social, and technological. In this article, we will talk about the function of PEST analysis in marketing. Let’s start.

Politics in PEST Analysis:

Whether you are working domestically or globally, government intervention and decisions can affect your business performance. Tax laws, trade restrictions, and employment policies can heavily impact your business (directly or indirectly). Foreign marketing and political stability are two important factors that can also affect your performance.

Economic:

It is really easy to understand the economic factor. Thus, there are several economic factors like disposable incomes, inflation, exchange rates, and interest rates that can influence your organization or business. These factors determine the future of your business.

Social:

In this section, the culture of the society and people’s behavior are two major things. Moreover, purchasing power, ethics, population trends, and media are really important things in the social segment. These things show that where you need improvement in your working and selling behavior.

Technological:

In production, communication, and distribution, you need advanced technology. Thus, these things ensure your competitiveness in the related market and bring some important edge. You should update your technology on a priority basis.

PEST Analysis in Marketing:

Keep in mind that PEST analysis only gives insight into external factors. It shows the major contributions of any organization’s marketing strategies. For instance, if you don’t consider social factors seriously then you will lose sales and also experience legal problems. Social factors are directly associated with the people and society in which you are operating. If you don’t follow rules and regulations then it can offend your audience. You have to design your marketing strategy according to the region and culture. On the other hand, if you fail to exploit digital marketing then there is a chance that you will lose a major portion of your customers. These are some important PEST factors that improve your marketing strategy.

 

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April 14, 2021 8 comments
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Samsung Pest Analysis
BusinessManagementMarketingSWOT & PESTLE 

PEST Analysis of Samsung | Samsung PEST Analysis

by Shamsul March 17, 2021

 

PEST Analysis of Samsung | Samsung PEST Analysis

 

With the help of PEST analysis, you can learn the success, power, and influence of a company with the four macro-environment factors like political, economic, social, and technological. These factors give the complete knowledge about the company and today we are going to discuss the world’s leading electronics company ‘’Samsung’’. In this PEST analysis, we will discuss the political scandals of Samsung, consumer inclination, and technologies that Samsung can exploit to enhance its working. Let’s start this PEST analysis of Samsung:

PEST Analysis of Samsung | Samsung PEST Analysis

Political Factors:

Generally, Samsung is a big name in the electronics market. It is important for the company to follow post and pre-existing regulations from the government. Political stability is also an essential factor in which Samsung operates. Without political stability, its expenses increase and profits reduce. Moreover, political instability also limits the supply chain and availability of products in the outlets. This kind of political unrest is really devastating for companies and damages their financial growth. Samsung has benefited and suffered from the utilization of political unrest. Samsung is associated with two South Korean Political parties and faced huge blowback due to the close relation with the first female South Korean President. They also provided billions of Korean won to the ‘’Uri Party’’ for the period of the presidential campaign. On the other hand, they also provided billions of Korean won to the opposing party.

Due to this reason, the public of South Korea was not happy due to the inclusion of Samsung in the political system. Due to this blatant manipulation, the company’s image was tarnished in the eyes of consumers. This fuss results in the 5-year jail sentence of Jay Y. Lee who was Samsung’s heir. This kind of political involvement of Samsung damages the brand image in the eyes of customers internationally. This thing limits the sales of Samsung globally and they also face restriction problems in several countries. For example, after this fuss, Germany blocked the sales of Galaxy tablets in its country.

PEST Analysis of Samsung | Samsung PEST Analysis

Economic Factors:

The biggest secret of Samsung’s success is the strong position of the Korean won. The value of Korean currency was declined in 2014 which results in the decrease of profits of Samsung. But this is not a major reason for the profit loss. The slow growth of the electronics market is also a big reason for the decline. It takes a long time to manufacture new Samsung products which result in stagnant sales. Don’t forget that the smartphone market is highly dynamic and saturated. There are many big players in this industry like Google and Apple. There is no doubt that Samsung is a leader in smartphone manufacturing but it is really worth remembering that it is a double-edged sword. Due to its strong consumer base, the company enjoys the benefit of immense revenue but this thing clearly shows that Samsung is highly dependent on the sales of smartphones.

With continuous innovation, they retain their position and market value without any trouble. The recent economic recession has changed the purchasing power of customers which can threaten Samsung’s profits. The problem of low wages and unemployment are two major factors that can limit the sales of Samsung’s products. As most of the Samsung products are luxury, so they are not a necessity. Any kind of worldwide crisis can also cause some trouble for the company. Despite all the weaknesses, Samsung releases new products every year in order to fulfill the requirements of consumers.

PEST Analysis of Samsung | Samsung PEST Analysis

Social Factors:

Samsung is a South Korean company and its products are shipped all over the globe. It is imperative for Samsung to acclimatize and modify its products according to the local markets. In order to provide the best products and services to users, it is necessary to identify the needs of consumers. To be very honest, Samsung is still lagging in this sector. For example, Google phones got the newest Android update but it took more than six months in the case of the Samsung Android firmware update. It means Samsung is lacking in the innovation sector and this thing might upset the users. It is really surprising for us that some people don’t like the pre-built programs in the western world. Also, it features Bixby, the voice assistant. In order to remain competitive in the market, it is really crucial for Samsung to depend on the Google Voice Assistant instead of trying something new and different.

According to experts, sometimes innovation is not vital. People need some time to acclimatize with existing innovation or technology and they don’t accept immediate innovation. You can relate it with iPhone and iPads. Samsung sticks to the headphone jacks in their smartphones which was really appreciated by the users. These kinds of social factors give a competitive edge to Samsung and they are continuously growing in terms of reputation and profits.

PEST Analysis of Samsung | Samsung PEST Analysis

Technological Factors:

In the present world, technology plays an important role and it is a double-edged sword. In the case of Samsung, it is the biggest strength of Samsung. They offer ultimate innovation in their offerings including smartphones, tablets, televisions, and so on. The company introduces innovation in its products every couple of years which is a major strength of Samsung. The risk of manufacturing errors is also present in this type of innovation. Exploding phones is a major weakness of Samsung due to faulty batteries inside the Galaxy Note 7. It creates a bad impact on the manufacturing and quality of Samsung which results in the decrease of Samsung products. But, Samsung promises to learn from their mistakes and improve their quality. After this announcement, they started working on this exploding problem and successfully control this issue. The biggest strength of Samsung is its strong consumer base that still used its products. They can’t even think about any other product in the presence of Samsung. Most of the consumers are waiting for the new products eagerly.

PEST Analysis of Samsung | Samsung PEST Analysis

Conclusion:

The involvement of Samsung in politics is proved unconstructive for the company. But, there is no doubt that it is a leading smartphone manufacturing company in the world. They faced a serious decline in their profits but they recovered from this issue due to their effective strategy. The reason behind this success is its instant adaptation. They understand the requirements of local markets and offered the desired products that fulfill their needs. Samsung is also very popular in the Western world and due to this reason, they decided to keep the headphone jack. We hope that you will learn too many things from this PEST analysis of Samsung. It is a fact that Samsung is a global player and its success is due to its strong and effective strategies.

 

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