A PESTEL analysis is used as a strategic tool to measure industry dynamics through recognition of the core political, economic, social, technological, legal and environmental forces/changes having influence on the industry (Henry, 2007, p.23). Sample Complete Report This is the sample complete report which will give you a glimpse of what your complete report will cover after purchase. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. Foreign currency exchange rates were insignificant in the second quarter. Restructuring of the European chocolate industry and its impact on cocoa production in West Africa. PESTEL analysis for the chocolate confectionery industry in Italy shows that there are 4 major factors impacting the overall market environment. Dec 31, 2014 by PESTLEanalysis Contributor Cadbury is synonymous with chocolate consumption worldwide. Climate change and changing ecosystem is leading to the extinction of more than 20% of species on the planet by the turn of this century. Chocolate Hawkins should be careful about the history of forex risk before entering new market. Different countries have different attitude towards health and safety so it is better for Chocolate Gourmet to conduct a thorough research before entering the market. -Environmental policy is very important to Lindt and Sprngli. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Chocolate Gourmet shouldnt be worried about the monopoly and restrictive trade practices law. - Environmental Standards and Regulations both at National & Local Levels Often the environment policy at national and local level can be different. . Chocolate Industry in India 7. But while chocolate and other products sold by the company are socially acceptable worldwide, Cadbury has been on the receiving end of controversies, the recent one involving Cadbury products being Halal Certified to cater to Muslim markets around the world. For example, Value-added Tax rose by 2.5% in 2010 and increased chocolate prices and reduced sales. - Mobile Phone & Internet Penetration Chocolate Gourmet should assess the level of internet and mobile phone penetration in the country as it will it in building a requisite business model based on local needs and realities. - Time Taken for Court Proceedings Even if the country has best of the laws, it doesnt mean much if they cant be enforced in a timely manner. The retail distribution of take-home and eat-later confectionery is basically done through two groups of channels, i.e. Government support: Government policies and initiatives to support the growth and development of the food industry can benefit the chocolate industry in the UK. The American, Brazilian and Chinese dollars. Political factors: Government policies and regulations can have a significant impact on the confectionery industry. Taxation: Changes in tax policies, such as changes in VAT or sugar taxes, can affect the prices of chocolate products and consumer demand. - Health & Safety Laws What are the health and safety laws in the country and what Chocolate Gourmet needs to do to comply with them. For example Uber employment system is not consistent with French laws and it is facing challenges in the country. If the legal system is not strong then Chocolate Gourmet can face numerous challenges from consumer petitions to shakedowns from authorities. However, the stringent restrictions on the entry of skilled workers from rest of Europe can affect Cadburys hiring decisions in the future. - Recycle Policies What are the recycle policies in prospective market and how Chocolate Gourmet can adhere to those policies. PESTLE analysis of chocolate industry in JAPAN. Digital Chocolate case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. 2. Published by HBR Publications. - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. - Gender Composition in Labor Market Chocolate Hawkins can use gender composition of labor market to understand the level of liberal nature of the society, women rights, and womens say in matter of societal issues and consumption decisions. The revenue in the chocolate market is projected to reach 340243.54 tons in 2022 and the market is expected to register a CAGR of 5.90% in terms of volume. Analyze the Chocolate Gourmet external competitive environment to identify opportunities and threats. In highly hierarchical societies the power of decision making often reside at the top. They also have the Nourishing Minds program, designed to provide children with basic nutritional needs. All Rights Reserved, Political factors: The politics and policies of chocolate, Economic factors: All problems, all the time, Social factors: A dedication to social responsibility and favor, then poor sales are obviously their fault, adopting new technology to create better treats, add this A.I technology to every one of their lines, the consumer pushback against their usage of the Ivory Coast (and potentially child labor), Twitter PESTLE Analysis: 6 Notable Factors Affecting the Social Network, How to Pursue a Career in Cybersecurity: 7 Professional Tips to Follow, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor. Even though the global economic downturn did affect Cadburys expansion plans (owing to a reduction in disposable income of customers and other stakeholders), sales actually remained quiet steady. Food safety and labeling regulations, such as those related to allergen labeling, nutritional information, and ingredient labeling. PEST is an acronym for Political Economic Social and Technological factors which are used to assess the market for a business. Introduction In 1966 Carl Kirkland co-founded Kirkland's in Jackson, Tennessee (Kir15). For example if the supply chain is not flexible it can lead to bottlenecks if shipments from one part of the world are delayed because of sudden climate shift. Mars Incorporated. In fact, Cadbury was able to gain a 30% increase in its annual profits, predominantly from the sales of Dairy Milk and Trident. Social factors such as demography trends, power structure in the society, women participation in workforce etc have immense impact over not only the country's economy but also on workforce talent availability and level of consumer demand. Objective 3. The alcoholic beverage segment accounted for the largest share of the market in 2020, with beer being the most consumed alcoholic beverage worldwide. Chocolate Hawkins has to assess whether it can live with the fast pace of technology disruption in its industry. This analysis helps businesses to make informed decisions and take advantage of opportunities while mitigating potential risks. We will make special emphasis on Cadbury UK, as this is where the company originally began. - Gender Composition in Labor Market Chocolate Gourmet can use gender composition of labor market to understand the level of liberal nature of the society, women rights, and womens say in matter of societal issues and consumption decisions. Chocolate Hawkins can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. Since then, the PESTLE analysis has become a popular strategic tool to assess the macro environment of organisations . For example as the population of USA and EU is growing old the demand for products mostly catering to this segment will grow. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. PESTEL analysis is mainly the assessment of macro environment factors. As an experiment, the company used a kiosk powered by Affectivas technology to encourage consumers to smile into the machine for a free sample. Our Twitter PESTLE analysis highlights the external factors, like political, economic, social, and technological ones, Cybersecurity is an increasingly important field of work. SWOT analysis of Amul Chocolates. The implication for Chocolate Hawkins is that it can boost sales of its product in short run but also expose Chocolate Hawkins to medium term forex and currency depreciation risks. All of this is rudimentary and basic, but playing the blame game doesnt leave a savory taste in consumers mouths. This will help in better predicting the environment policy of the country. This will enable the Chocolate Hawkins to determine if required can it hire talent globally to work in that particular market. Analyze the Chocolate Hawkins external competitive environment to identify opportunities and threats. PESTLE Analysis of Nestle in light of Industry 4.0 Political and Economic Forces Politcal Factor Sustainable Politics: PESTLE Analysis Industry-4.0 efforts in UK are politically driven, commitment from the top is a motivating factor for companies to adopt new practices. Many nutritionists recommend people to reduce their consumption of chocolate and candy, which is likely to affect Cadbury sales in the future. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. The gender composition of labor market is a good indicator of disposal income of household, priorities of the households, and related needs. Execution of the strategy and building a feedback loop, using which managers at Chocolate Hawkins can fine tune processes and strategies going forward. They're advanced in telecommunications yet follow a patriarchal family system. - Focus & Spending on Renewable Technologies How much of the budget is spend on renewable energy sources and how Chocolate Gourmet can make this investment as part of its competitive strategy. - Consumer Protection Laws Chocolate Hawkins needs to know what are the consumer laws, what is the rate of enforcement, what is the attitude of authorities towards consumer protection laws, and what is the role activist groups in enforcement of consumer protection laws. Amul Chocolates is a product category of the milk company Amul which is the brand name for the Gujarat Cooperative Milk Marketing Federation. Choosing the vision, mission and the reason of existence for Chocolate Hawkins. Environmental regulations, such as those related to waste disposal and sustainable sourcing of cocoa and other ingredients. PESTLE Analysis of Soap Industry in India, PESTEL Analysis of Starbucks in Philippines. - Transition of Government and Changes in Policy There is consistency in policy making from one government to another. Feel free to connect with us if you need business research. There are four major factors identified to capsulate the different factors found from the different environmental influences. L - Legal. However, the GDP is expected to slow down in both 2020 and 2021 and bounce back in 2022. Learn how to, Our Mayo Clinic SWOT Analysis examines the Strengths, Weaknesses, Opportunities and Threats of one of, Technology is now taking over, and almost all fields are turning most tasks into digital., Copyright 2020 Weberience LLC. Know More It shares its borders with the neighboring countries of Namibia, Botswana and Zimbabwe, and to the east are . Net sales ($1,751.6 million) were an increase of 5.3 percent. - Political Governance System Based on the information provided in the Digital Chocolate case study, it seems that the country have a stable political system. Psychographics and Demographics 14. Demographics: The UK has an aging population, which may impact chocolate consumption patterns as older consumers may be less likely to consume chocolate or may have different preferences than younger consumers. Thus, disruption in the supply chain of raw materials . PESTEL Analysis, SWOT Analysis and Risk Analysis of Egypt Egypt PESTEL Analysis This report covers Egypt 's PESTEL (political, economic, social, technological, environmental and legal) analysis. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. In doing so, theyre committed to being more transparent about the ingredients. According to Jose Lopez, Nestle's Vice . Chocolate Gourmet should be aware of presence of such practices in a country. Sep 2014. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. It speaks out against child labor and slave labor, while also using sustainable practices for the environment. He introduced the framework back in 1964 in his book " Scanning the Business Environment ". Cadbury 11. Linda A. Hill, Alison Berkley Wagonfeld (2018), "Digital Chocolate Harvard Business Review Case Study. Over one hundred million residents live in Japan and are forced to live in specific locations. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. Here are 7 professional tips that can, Our General Mills SWOT Analysis examines internal and external factors that impact the company's operations, What is root cause analysis, the goal, and why is it important? Research Methodology 4. Luckily for the company, things turned around in the first two quarters of 2018. Macroeconomics is the study of large-scale economic elements, often relating to countries as a whole.The factors this analysis represents are political, economic, social, technological, legal and environmental. (Child Labor and Slavery in the Chocolate Industry, 2014). The Hershey's Company is the largest chocolate manufacturer in North America and yet they've hit major setbacks both politically and economically. It would focus on the macro-environmental factors that impact her growth and productivity. This is where the PESTEL analysis comes in handy as a useful tool for identifying the external factors that could affect the chocolate industry in the UK. The Hershey Company is adopting new technology to create better treats. Chocolate Gourmet should carefully analyze the attitude towards authority before launching a marketing campaign for its products and services. When too heavy, additional ingredients go to waste. "Tasting Empire: Chocolate and the European Internalization of Mesoamerican Aesthetics." The American Historical Review 111 (3):pp 660 Odijie, E.M., 2016. Although the company is clearly attempting to bring social good into the world, it doesnt stop them from blaming consumers when sales are declining. Brazil Chocolate Market Analysis. Cadbury is a well-known producer and distributor of chocolate and milk-based products. Mostly the unusual macroeconomic winds and generic challenges caused sales problems. - Intellectual Property Rights Protection Chocolate Hawkins should assess the level of protection that intellectual property rights get under the legal system of the country. Chocolate Gourmet should assess what are preferred choice of mobile payments in local economy and chose the business model based on it. - Level of Acceptance of Technology in the Society Chocolate Hawkins has to figure out the level of technology acceptance in the society before launching new products. MBA Skool InstallCourses Home Courses Concepts SWOT Switzerland is one of the largest economies in the world. Amul Chocolates also . 2012). We at EMBA Pro believe that in near future the sector most disrupted by technological innovation is manufacturing and production. Managers at Chocolate Hawkins need to examine three inter-related environments in order to come up with an effective strategy. PEST ANALYSIS The PEST analysis is a useful tool for understanding market growth or decline and as such the position potential and direction for a business. Introduction 2. In 2015, the company blamed American consumers for not buying more chocolate. Packaging: There is a growing demand for sustainable and eco-friendly packaging solutions, which has led to the development of new technology for biodegradable or compostable packaging materials. The government of each party has adhered to the treaties done by previous governments, so there is a consistency in both rule of law and regulations. The snapshot of this . Feel free to connect with us if you need business research. Available to download is a free sample file of the Chocolate Market report PDF. If youve ever enjoyed the classic Hersheys, Kit Kat, or Reeses Peanut Butter Cups, then youve been a consumer of the Hersheys Company. - Nature of Social Contract between Government & Society Before entering into a market Chocolate Hawkins needs to understand the nature of social contract between government and society. India's strong economic growth over the past decade has catalyzed the country's per capita disposable incomes . Choosing the vision, mission and the reason of existence for Chocolate Gourmet. - Immigration Policies and Level of Immigration What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. Tax rates were also terrible, according to Mr. Bilbrey. - Consumer Disposable Income The household income of the country has increased constantly in the last decade and half, compare to the USA market where household income is still below 2007 levels and not increased in real terms since early 1980s. The gourmet category was expected to grow as consumers incorporated more expensive gourmet foods into their diets, a trend beginning with the beer, wine, coffee, cheese, and ice cream industries. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. Kurien, the cooperative society makes milk and various milk products like curd, cheese, milk powder, cheese spread and chocolate amongst others. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Chocolate Hawkins shouldnt be worried about the monopoly and restrictive trade practices law. - GDP Trend & Rate of Economic Growth The higher GDP growth rate signals growing demand in the economy. - Attitude towards Authority Various cultures in different part of the world have different attitude towards authority. Today, Kirkland's main sales support center is located in Brentwood, Tennessee which supports 337 stores in 35 states. Macro Environment Analysis: PEST Analysis: Order custom essay Nestle: Macro Environment and Micro Environment Analysis with free plagiarism report GET ORIGINAL PAPER. The remaining 35% of the chocolate industry was divided among Bourbon Corporation, Nestle S.A., Morinaga & Co, Fujiya, Kabaya Foods Corporation, and Cadbury. Due to favourable political factors, Amul company achieved a growth of 11.35% in its operating units in Kolkata, Pune and Mumbai. PEST or PESTLE analysis is used to identify important external (macro-environment level) forces that could affect a company, creating opportunities or threats for the organization. With so many chocolate options and new additions for 2018, Mr. Buck seemed confident in the variety they offered, as well as the new marketing campaigns launched for the products. This lack of clarity and responsibility highlights the company's failure to take action despite having all the resources and power to reduce child labour. It factors in temperature, rotations, pressure, and other necessary measurements to make the perfect candy. Many US companies have incurred losses in Mexico in regular forex crisis in that country. The conditions of a country affect the businesses within it, and PESTLE analysis helps these businesses understand the possible effects . In this PEST analysis of Cadbury, we saw how this leading chocolate company has dealt with external factors in the UK and in many other countries as well. Hence, Cadbury and its range of products are now owned by the American confectionary giant. The company was founded in 1924 and has gained much popularity now. Although the African government created an audit system to monitor child labor, its not easy to prosecute offenders offenders like the Hershey Company. The Hersheys Company is the largest chocolate manufacturer in North America and yet theyve hit major setbacks both politically and economically. In this essay, we will conduct a PESTEL analysis of the chocolate industry in the UK to identify the key external factors that could affect its future prospects. It is important to note that the Chocolate Confections Corporation PESTEL Analysis will be market specific, and the implications of the factors change for a company when the market . - Transparency & Digital Drive Chocolate Gourmet can use digitalization of various processes to overcome corruption in the local economy. - Intellectual Property Rights Protection Chocolate Gourmet should assess the level of protection that intellectual property rights get under the legal system of the country. Note on the U.S. Chocolate Market case study (referred as Chocolate Gourmet for purpose of this article) is a Harvard Business School (HBR) case study covering topics such as Strategy & Execution and strategic management. Execution of the strategy and building a feedback loop, using which managers at Chocolate Gourmet can fine tune processes and strategies going forward. Of course, the format of the presentation barred us from discussing how the acquisition of Kraft Foods will affect company performance in the future. Some social factors that may affect the chocolate industry in the UK include: Changing consumer preferences: Consumers in the UK are becoming more health-conscious and may seek out lower-calorie or healthier chocolate products. First with the consumer pushback against their usage of the Ivory Coast (and potentially child labor). This will enable the Chocolate Gourmet to determine if required can it hire talent globally to work in that particular market. Labor costs: The cost of labor, including wages, benefits, and training, can impact the profitability of chocolate manufacturers. In 2015, the Hersheys Company surfed upon a sea of negatives. - Employment Rate If the employment rate is high then it will impact Chocolate Gourmet strategies in two ways it will provide enough customers for Chocolate Gourmet products, and secondly it will make it expensive for Chocolate Gourmet to hire talented & skillful employees. Since then, chocolate and Cadbury have been part of the same sentence. Hersheys came under fire in 2011 for using cacao from Ivory Coasts in Africa. Article. South Africa, officially the Republic of South Africa, is a country located at the southern tip of Africa, with over 1,739 miles of coastline that stretches along the South Atlantic and Indian oceans. - Securities Law What are the securities law in the country and what are the conditions to list the company on national or regional stock exchange. - Types of Immigration & Attitude towards Immigrants Given the latest developments such as Brexit and Immigrant detention on Southern border of United States. At EMBA PRO, It requires less temperature and energy to produce (unlike non-raw chocolate), and thatll also bring a smile to the faces of eco-friendly consumers. - Influence of Climate Change How climate change will impact Chocolate Gourmet business model and supply chain. Yasemin Oraman. U.S. retail chocolate sales were forecast to grow to $14.5 billion in 2007. Our Twitter PESTLE analysis highlights the external factors, like political, economic, social, and technological ones, Cybersecurity is an increasingly important field of work. Raw material prices: Fluctuations in the prices of cocoa, sugar, and other ingredients can affect the cost of production and ultimately the price of chocolate products. Global Chocolate Market - offers growth, outlook, trends, shares, Industry Analysis, opportunities, Key Players Forecast 2019 to 2025 IND: (+91) 949418 5556 , USA: (+1) 408-915-5456 sales@envisioninteligence.com The next element to address in the PESTEL analysis of Switzerland is the economic environment. Chocolate Hawkins should build a strategy that can integrate societal values, infrastructure, and Chocolate Hawkins business model. It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. - Research and Development Investment Levels If there is high level of investment in technology development sector then there are high chances of building a self sustaining ecosystem that drives innovation. On the other hand, Nestle has a better record of recycling. Chocolate Gourmet has stringent norms for health and safety norms so in emerging economies it may have to compete with players who dont have high cost structures that of Chocolate Gourmet. It has decimated the culture of savings as people dont have enough to save. Some of the economic factors that Chocolate Hawkins should evaluate both in the present market and one in which it wants to enter are inflation rate, GDP growth rate, disposable income level etc. This will help in better predicting the environment policy of the country. The company has attempted to make amends by creating socially-conscious programs to help children in need. Amul 9. Published by HBR Publications. The full-year net sales increased by 1 percent, even though the four-quarter net sales dropped by 1.6 percent. - Securities Law What are the securities law in the country and what are the conditions to list the company on national or regional stock exchange. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. As population is ageing it will require less tech intensive products. Business do face problem when the conflict is between public interest and proprietary technology similar to ruling in South Africa where government & judiciary allowed generic AIDS drug irrespective of patents of global companies. Here's the pestle analysis of UK as follows; Political factors impacting the UK Government System - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. Chocolate Gourmet should be careful about the history of forex risk before entering new market. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. Chocolate Mould Market Share, Size Global Growth Analysis, Trends, Industry Analysis, Key Players and Value,Opportunity Forecast to 2025 Posted o. Wednesday, 01 March 2023 08:34 GMT. - Attitude towards Authority Various cultures in different part of the world have different attitude towards authority. Chocolate Gourmet should have capabilities to navigate under this hyper sensitive environment. PEST analysis is used to control the external factors of what happens outside the . In 2000, 81% of U.S. adults consumed chocolate. multiple grocers and impulse retail channels.