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What is PESTEL Analysis?
PESTEL analytical model, also known as macro-environmental analysis, is an effective tool for analyzing the macro-environment, not only to analyze the external environment, but also to identify all the forces that have an impact on the organization. It is a method of investigating the external influencing factors of an organization, and each of its letters represents a factor, which can be divided into 6 major factors:

(1) Political factors (Political): refers to the political forces that have actual and potential influence on the organization's business activities, and the relevant policies, laws and regulations, and other factors.

(2) Economic factors (Economic): refers to the organization's external economic structure, industrial layout, resource conditions, the level of economic development and future economic trends.

(3) Social factors (Social): refers to the historical development of the members of the society in which the organization is located, cultural traditions, values, education level and customs and other factors.

(4) Technical factors (Technological): the technical elements include not only those inventions that cause revolutionary changes, but also the emergence and development trends of new technologies, new techniques, new materials and the prospects for their application in relation to the production of enterprises.

(5) environmental factors (Environmental): an organization's activities, products or services can interact with the environment.

(6) Legal factors (Legal): the organization's external laws, regulations, judicial status and citizens' legal awareness of the integrated system.

PESTEL is formed by adding environmental factors (Environmental) and legal factors (Legal) on the basis of PEST analysis. When analyzing the background of a business group, these six factors are usually used to analyze the situation faced by the business group.

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[edit]

[edit]PESTEL factors

[edit]Political factors that have an impact on business strategy

Government regulation and deregulation

Government procurement scale and policy

Specialty tariffs

Number of patents

United States-China relations

Changes in fiscal and monetary policies

Special local and industry regulations

World crude oil, currency, and labor markets

Import and export restrictions

Political conditions in other countries

Size of the government's budget

[edit] Economic factors that have an impact on business strategy

Economic transition

Level of disposable income

Economies of scale in interest rates

Consumption patterns

Government budget deficit

Labor productivity levels

Stock market trends

Import/export factors

Differences in incomes and sales and consumption habits between regions

Labor and Capital exports

Fiscal policy

Euro**** body policy

Consumption tendencies of the population

Inflation rates

Money market interest rates

Exchange rates

Gross national product trends

[edit] Socio-cultural factors

Peculiarities of business or industry Interest groups

Changes in national and corporate market demographics

Lifestyle

Public morality

Attitudes towards environmental pollution

Social responsibility

Income disparity

Income per capita

Values, aesthetics

Attitudes towards after-sales services

Regional interest and preference ratings

[edit]Factors of technology

What technologies does the firm use in its production operations

How important are these technologies to the firm

What technologies are included in outsourced raw materials and components

Which of the external technologies mentioned above are critical? Why?

Is the firm able to utilize these external technologies on a sustainable basis

What are the recent developments in these technologies? Which companies are up-to-date on the latest technology developments?

How will these technologies change in the future?

What investments have companies made in key technologies in the past?

How does the firm's technology level compare to that of its competitors?

What investments have the firm and its competitors made in product development and design, process innovation, and production

Subjective external rankings of the firms' technological levels

What is the firm's product cost and value-added structure?

What of the firm's existing technology can be applied? What is the degree of utilization?

What technological resources does the firm need to have to achieve its current business objectives?

How does the firm's technology affect the firm's competitive position? Does it affect the firm's business strategy?

[edit]Factors of the environment

Profile of the company (number, size, structure, distribution)

Trends of the industry and related industries (starting, figuring out, lagging behind)

Impacts on related industries

Impacts on other industries

Impacts on non-industrial environments (natural environments, moral standards)

Degree of media attention

Sustainability space (climate, energy, resources, recycling)

Global development of related industries (patterns. Trends, Impact)

[edit]Legal factors

Worldwide conventions, provisions

Basic laws (Constitution, Civil Code)

Labor protection laws

Company and contract laws

Industry competition laws

Environmental protection laws

Consumer rights protection laws

Industry conventions

[edit]PESTEL Analysis Classic Case

According to PESTEL's framework model, the following six macro-factors are analyzed one by one around the beer brewing industry, and then the structural drivers affecting the industry as well as the fundamental linkages between these macro-factors that influence and constrain each other are explored.

(I) Political factors

From the political factors to analyze, at present and in the next few years, China and the world's political situation basically tends to stabilize the political situation, "peace and development" is the two major themes of the contemporary world, is the people of all countries in the world *** with the desire, China around this theme of the times! With the accession of WTO, China's tariff barriers are canceled one by one, and foreign products enter into China immediately, so that according to incomplete statistics, there are nearly 40 foreign brands of beer in the domestic production, the output accounted for 4.3% of the country, so that the original national protection and encouragement policies for the beer industry, has now disappeared, and then face the challenge of foreign brands of beer, which is the most important thing for us. The challenge of foreign brands of beer, thus, the beer industry in China caused a certain impact; at the same time, there are certain favorable factors, the reduction of import tariffs, so that the beer industry can expand the choice of beer raw materials and advanced equipment, such as imported barley is usually of good quality, the process is easy to control, which reduces the cost of production, through the introduction of advanced equipment from abroad, is conducive to improving the brewing level, in addition, it is also conducive to China's beer industry. The introduction of foreign advanced equipment is conducive to improving the level of beer brewing, in addition, is also conducive to China's beer products towards and into the international market.

(2) economic factors

Economic cycle is a response to the economy from prosperity - slow (decline) - low tide - recovery (high) of the process of reciprocal changes. According to relevant statistics, China is currently in the third economic cycle of the rising stage, from the Development Research Center of the State Council for China's economic growth rate from 2001 to 2020 for the forecast results show that from 2001 to 2010, China's GDP growth rate of 7.9%, so it can be predicted that China in the next few years to continue to have a stable and sustainable economic development, the development of China's economic environment is good. The favorable development of China's economic environment predicts that the beer industry will continue to maintain a strong momentum of development.

Since the early 1990s, by the state-owned enterprises operating in the downturn, the state-owned enterprises, a large number of layoffs, unemployed people, employment issues have become constraints on China's economic and social development of the "bottleneck", but from the annual sales of beer year by year, the trend of unemployment has not been able to affect the development of the beer industry, on the contrary, the beer as a cheap and easy to use, the beer industry is the most important factor in the development of the beer industry, on the contrary. On the contrary, beer, as a cheap consumer product, has become a tool for people to let off steam when they are sad, a stimulant when they are happy, and an effective medium for social occasions and pouring out one's heart. Therefore, because of the unique effect of beer's eclecticism (the sharing of happiness and sadness and health care), it is determined that the consumer group is not very obviously affected by the economic situation, so it can be seen that the establishment and cultivation of the interest in beer for the mass consumer group and the correct guidance, publicity is essential and has a very permanent charm.

(3) Social and Cultural Factors

(1) Changes in Lifestyle

Beer first appeared in Ancient Egypt and Mesopotamia (present-day Iraq), and its production method was introduced to Germany from Egypt through North Africa, the Iberian Peninsula, and France, and the beer manufacturing industry was developed unprecedentedly in the southern part of Germany, and the beer technicians in Germany disseminated the beer technology to the whole world. After the reform and opening up, the beer industry has been influenced by the western culture in Europe. After the reform and opening up, under the influence of European and Western culture, people's dietary culture began to approach the West, and beer then entered China, and people have experienced the indispensability of beer from not understanding it, trying to try it, and nowadays catering and entertainment, so it can be seen that the beer culture has a profound charm. With people's in-depth exploration of the effects of beer, it has been learned that beer not only contains the amino acids needed by the human body, but also contains rich vitamin B2, niacin and minerals, thus earning it the name of "liquid bread". In addition, beer has become an important part of the campus social culture as it has been widely promoted on campuses, thus, the age-appropriate consumer group of beer has been gradually extending forward, and now it has expanded to include people aged 18 to 60 years old, so it is evident that the beer industry has its own strong consumer groups.

(2) Influence of Population Growth Process and Distribution

First of all, from the perspective of China's population growth process and trend, since the early 70s when China vigorously implemented family planning, China's birth rate and natural growth rate have dropped significantly, but the population increase determined by the huge population size accumulated in history is still considerable, according to the relevant data, in 2000, China's population aged between 18 and 60 years old had already increased to 1.5 million. According to relevant data, in 2000, China's population aged between 18 and 60 reached 816 million, 2.15 times that of 1964, and in the next 30 years, the proportion of this population to the total population will remain above 60%. As the age structure of China's population shows a pattern of "two small ends and a big middle", the outlook is still very optimistic from the perspective of beer's age-appropriate consumer groups.

Secondly, looking at the global birth rate and fertility rate, the overall trend is from high to low. The decline of birth rate and fertility rate in developed countries started as early as during the Industrial Revolution, and by the end of the last century, the fertility rate of the population had already dropped below the replacement level, and there was even negative population growth, therefore, the focus of the future growth of the world's population will be concentrated in the developing countries and regions. 80.66% of the world's population was distributed in the developing regions in 2000 (such as Nigeria, Pakistan, and so on), and this proportion will rise to 87% in 2050, and the proportion of the world's population will increase to 87% by the end of this century. In 2000, 80.66% of the world's population was located in developing regions (e.g. Nigeria, Pakistan, etc.), and in 2050, this percentage will rise to 87.33%, which will increase the burden on the population.

(4) Scientific and technological factors

Analysis of scientific and technological factors, "one of the most dramatic factors that change the destiny of mankind is technology", the development of the enterprise can not be separated from the technology, there is no technological and product innovation, there is no enterprise growth and progress, there is no enterprise's future. The reason why "Yanjing" dares to call the shots in the market to the world's beer giants is because they have technology, product innovation to do, visible, the relationship between the beer industry and science and technology is by no means inferior to the relationship between the IT industry and science and technology, however, from the overall status quo in China's breweries seem to see, is still the level of the lower, smaller, higher consumption, lower efficiency, each production of 1 ton of beer water consumption. Low, each production of 1 ton of beer water consumption in 8 ~ 40 cubic meters, the corresponding drainage for 7 ~ 35 cubic meters, while the developed countries of the ton of beer water consumption is only 5 ~ 10 cubic meters, indicating that China's breweries and developed countries still have a certain gap between the advanced level of foreign breweries. Therefore, continuous technical innovation, technological progress, saving limited resources, strengthening environmental protection is the development trend of the beer manufacturing industry.

(E) environmental factors

From the natural factors, the vast majority of industrial production activities inevitably destroy the quality of the natural environment, and now from the United Nations to the world's governments have paid enough attention to environmental pollution, and formulated the relevant laws to be stopped, which is not only the protection of the Earth's environment, the objective need, but also the "harmony between man and nature **". "Harmony between man and nature *** place" trend, the beer brewing industry, its environmental factors are extremely relevant and should not be ignored. At present, the assessment of the beer industry wastewater quality using the national emission standards GB8978-1996 "comprehensive sewage discharge standards", did not stipulate separate pollutant discharge standards for the beer industry, with the strengthening of pollution control and management, the State Environmental Protection Administration and the State General Administration of Quality Supervision and Quarantine for the beer industry wastewater emissions, high concentration of organic pollution, serious environmental pollution, discharge factors are relatively more The State Environmental Protection Administration and the State General Administration of Quality Supervision and Quarantine, in view of the large volume of wastewater discharged from the beer industry, the high concentration of organic pollution, the serious pollution of the environment, and the relatively small number of emission factors, have jointly issued the industry-wide wastewater discharge standard in line with the characteristics of the wastewater discharge from the beer industry - the "Pollutant Discharge Standard for the Beer Industry", which has been implemented since January 1, 2006, and is a compulsory standard. The earth is our *** with the home, environmental protection is the world's attention to the theme of the times, any industry must do a good job of environmental protection after treatment is the way of long-term business, the beer industry is more so, based on this, the days of the lake company in 2000 invested 6.5 million to build a sewage treatment project, an effective solution to the problem of sewage discharges.

(F) legal factors

From the analysis of legal factors, the law on the regulation and development of the industry has played a role in safeguarding, monitoring and restricting, with the development of social and economic, frequent business contacts, the market environment is becoming increasingly complex, and then faced with a variety of obvious and potential legal issues, if the existence of legal issues in the business process is not able to be noticed in a timely manner, it will be "cumulative problems". If the legal problems existing in the process of business operation are not detected in time, they will "accumulate and become a disease", and once they break out, the enterprise may suffer from significant losses as a result. According to AQSIQ, the Food Safety Law will be introduced at the end of this year, which requires the industry to start from the development of high-tech, using advanced technology and testing methods, last year's "beer formaldehyde incident" reflects the beer industry's negligence of the relevant laws and regulations, which in turn has brought a certain negative impact on the entire domestic beer industry. The company's website has been updated with the latest information on the industry.

All in all, political stability and the political ideas and behaviors it adopts will directly bring different degrees of positive and negative impacts on the overall economic environment. The different stages of economic level and the different speeds of economic development have different degrees of impacts on the social cultures and lifestyles they belong to, while the economy provides material guarantee for the development of science and technology, and at the same time, the technological innovations promote the economy. The rapid development of economy, science and technology, we need to add the relevant legislation of the newly involved fields as well as improve and perfect the relevant laws and regulations in the known fields, and environmental protection is the fundamental to achieve sustainable development of mankind and the world economy.