Studied by 1 person
PESTLE C
Political Economic Social Technological Legal Environmental Competition
political
politically volatile regions require special attention → reduced business ventures there
economic
general state of the economy has huge impact on business activity e.g. recession = bad
social
changes in the way society operates e.g. more people at uni
technological
provides new opportunities and lowers unit costs
legal
gov provides legal framework in which businesses operate → protects vulnerable groups
environmental
protecting the environment = more important → businesses need to be more aware
structure of markets
competitive markets
uncompetitive markets
oligopoly (large companies dominate and v few small companies
Porter’s 5 forces
threat of new entrants
bargaining power of suppliers
threat of substitutes
bargaining power of buyers
rivalry among existing competitors
threat of new entrants
setting up barriers to entry for the industry
creating strong and loyal brands
large amounts of advertising used as a deterrent for new rivals
supply bargaining power
businesses can grow vertically → acquire a supplier
seek new suppliers
minimise the info provided to suppliers
rivalry
buy up rivals
innovation and advertising competition
substitutes
reduction by using research and development and patenting substitutes
customer bargaining power
improve competitive position
encourage other businesses to set up in customers market → reduce power
expensive to switch suppliers
