PESTLE Analysis: A Significant Business Analysis Tool


Marketing is a significant tool for any business. Without marketing, there cannot be a business. Hence, it is significant to use the right tool for the constant growth of a business. Moreover, we know about the SWOT analysis and its importance in any business. So, here All Assignment Help presents another way of analysing business called a PESTLE analysis. As per the business experts, it describes a framework of macro-environmental factors which is widely used in strategic management.

Additionally, while doing market research, PESTLE analysis provides an overview of various macro-environmental factors that should be considered. Generally, PESTLE analysis is said to be a strategic tool which helps you in the understanding position of the business, the decline and growth of the market, and the potential and direction for operations. 

What is PESTLE Analysis? 

As mentioned in the paragraph above, PESTLE analysis is a business tool that helps in obtaining a macro picture of the environment of an industry. Furthermore, PESTLE stands for Political, Economic, Social, Technological, Legal and Environmental factors. Moreover, with the help of PESTLE analysis, any company can develop a blueprint of the factors that might impact their business or the industry in any way. In addition to this, PESTLE analysis also helps the businessmen in the identification of all the risk factors for the SWOT analysis. While conducting this analysis, one must ask certain questions. Because this will provide them with the idea of things they should keep in mind.

  • What is the political situation of the country and what impact it can cause on the industry? 
  • What are the frequent economic factors?
  • How important is culture for the market and what are its determinants?
  • What are all the environmental concerns for the industry? 
  • What technological innovations might occur and put an impact on the market structure? 
  • Are there any chances of changes in the legislation for the industry? 

All the abovementioned aspects are significant as it represents the spine of strategic management. Moreover, this not only defines the actions that a company should take but also develops the goal for an organisation. Apart from this, if you are a student of marketing and find your assignments intimidating, you can always seek an expert’s assistance for high-quality assignment writing. This not only makes your grades better but also saves you time so that you can learn more about the realistic strategies to use in the business. 

Political Factor in PESTLE Analysis

The political factor in PESTLE analysis talks about the role of government in providing a shape to the business. Moreover, it is inclusive of elements such as the stability of the government, tax policies, changes in trade restrictions and tariffs. Furthermore, immigration policy is also an aspect here that offers necessary implications to the business. Politics may affect the operations as well. In addition to this, the personal interest of the employees may also influence the functioning of an organization. Hence, you must give a thought to all of it while writing the P of the PESTLE analysis.

Economic Factor in PESTLE Analysis

Next in the line is the economic factor in PESTLE analysis. Here, you have to take the same approach to analyse the internal and external economic environments. Moreover, you have to analyse a company’s project viability while assessing the internal factors. It can also give you an idea of the internal soundness of the project. You can use financial models and accounting techniques for the same purpose. Furthermore, you need to focus on interstate taxes, embargoes, and interest rates while considering external events. Look at the economic growth, inflation, minimum wage, working hours and financing availability, etc. Covering all these aspects makes your economic element of pestle analysis complete. 

By any chance, if you are intimidated by the thought that how to write marketing assignments like a pro then always remember that mentioning some of the analysis tools in your assignments would always earn you extra marks. Moreover, it will make your work look more expert-like. Now, let us move to the social factor in the PESTLE analysis. 

Social Factor in PESTLE Analysis

Social factor in PESTLE analysis helps in the identification of events that can affect any community and market. Moreover, you need to have the right information about the types of products that are in demand in the area you are operating. Furthermore, you should consider all the benefits and issues that people are likely to face in the area of your operations. Additionally, the social factor in PESTLE analysis is inclusive of demographics such as population size, age, and ethnic mix. Moreover, it also includes the attitude of businesses towards obesity and consumer activism. For that, you need to analyse the cultural expectations, norms, and population dynamics of the area. Furthermore, you need to know health consciousness, career attitudes and preferences.

Technological Factor in PESTLE Analysis

Technological factors in PESTLE analysis talk about the improvisations in the services and products that can come due to science. Technology gets outdated in a short period. Therefore, doing this analysis helps you in using the right technology as per the market demands. You may make a financial decision on the use of technology easily after giving a thought to it. Furthermore, some of the relevant factors of this segment are an increase in automation, advancement in service industry delivery, and changes in the rate of new product development. 

Legal Factor in PESTLE Analysis

Legal factor in PESTLE analysis talks about the influence of court on the business activities. Therefore, one should analyse legal factors keeping both internal and external matters of a company in mind. Moreover, some laws may affect your business in the country of your operation. Hence, you should also maintain policies for your organization.

A legal analysis helps you in giving a thought to both of these angles. As a result, you can come up with legal strategies to address all the legal aspects. The main legal aspects one should look into during the analysis are employment laws, taxation, imports, exports, health and safety regulations, antitrust laws, and discrimination laws. 

Environmental Factor in PESTLE Analysis 

The environmental factor in the PESTLE analysis talks about the physical conditions within which you are operating your business. Moreover, it is inclusive of factors like pollution levels, natural disasters, weather patterns, etc. Therefore, it is necessary to have awareness of the environment where your business operates. Additionally, the aspects can be natural, social and economic. For instance, area temperature, monsoons, and natural calamities come into the natural category. Moreover, travel access and ground conditions fall into the socio-economic factors category. Near water source and ground continuation are also the parts of it.

Also read: Tips to Deal with the Complexity of the Marketing Assignments 

Advantages and Limitations of PESTLE Analysis 

As we know PESTLE analysis helps in auditing the external environment. Moreover, it helps in detecting and understanding broad and long-term trends. Furthermore, there are multiple business planning situations such as strategic business planning, workforce planning, marketing planning, product development, organisational change, and people strategies, reports and projects, PESTLE analysis supports them as well. Now, there are certain advantages and limitations associated with the process. Let us read about them. 

Advantages of PESTLE analysis 

  • It is a simple framework. 
  • With the help of PESTLE analysis, external and strategic thinking can be strengthened. 
  • It provides a wider understanding of the business environment. 
  • PESTLE analysis enables the industry or organisation to find all the opportunities in the business and exploit them completely. 
  • It helps a business or organisation to spot the business threats and take significant actions to avoid them or make the impact minimal. 

Limitations of PESTLE analysis 

  • Some of the users of PESTLE analysis tend to oversimply the amount of information and data whilst it is always easy to use insufficient data. 
  • When you capture too much data, you put the analysis at risk which might lead to paralysis analysis. 
  • There are chances of using fictional data which cannot be founded later. 
  • To see effects, it is necessary to repeat the process on a regular basis. 
  • Anticipation can face problems due to the pace of changes. This may affect the business or the organisation in the future. 

For a market expert, all of the above-mentioned tools and factors can be easy to use. However, in case, as a student you are not able to have a firm grasp on all these marketing concepts, methodologies, tools, advantages, limitations, etc. then seeking a good marketing plan assignment help is always a wise idea. You can always achieve the best with the experts. 

Conducting PESTLE Analysis for a Company 

In the above sections, we discussed the advantages and limitations of PESTLE analysis. Moreover, we understand that your ultimate objective is to learn how to do a PESTLE analysis of a company. Furthermore, during your academic years, you might have to do a PESTLE analysis of some celebrated brands as practice. Hence, in this section, we will focus on giving you an idea of the same.

Understand the PESTLE Factors

To make impeccable strategies, you need to ensure that your PESTLE analysis is well-researched. Therefore, to do so, you must understand the six PESTLE factors thoroughly. So, let’s find out the points you should check for while considering these factors.

Political Factors

Some of the significant political factors are government policies, government terms and change, trending policies, war, terrorism and conflicts, elections and political trends, internal political issues, inter-country relationships, initiatives and funding grants, corruption, lobbying and pressure groups

Economic Factors

Major economic factors affecting business are the local economy, economic trends, inflation, taxation, interest, industry growth, import and export ratios, international trade, seasonality growth, international exchange rates, etc. 

Social Factors

Here are some crucial social factors, demographics, work ethics, brand, company, technology image, lifestyle trends, cultural taboos, media views in the industry, consumer purchasing patterns, advertising and publicity, purchasing access and trends, major events and influences. 

Technological Factors

Some of the technological factors are emerging technologies, technology legislation, research and innovation, maturity of technology, intellectual property issues, information and communications and competitor technology development. 

Legal Factors

Major legal factors are current legislation, proposed legislation, international legislation, employment law, health and safety regulations, regulatory bodies and processes, industry-specific regulations, tax regulations, consumer protection, and competitive regulations. 

Environmental Factors

Some major environmental factors are environmental regulations, reduction of carbon footprint, sustainability, ecological regulations, and the impact of adverse weather. 

Collect Relevant Data 

Research is the key to a successful PESTLE analysis. Because it gives you a fine idea of what may work for your business and the things you need to be aware of. Hence, the next step you should take while doing a PESTLE analysis is to gather relevant information. Moreover, you must focus on finding the information that can give you an idea of the external environment. Furthermore, the internet is the source you can use for the same purpose. You also have the option of carrying out your research. However, it may cost you some money. In case you find analysis tough for you, you can get top-notch market analysis assignment help on the internet. 

Give a Thought to the Opportunities

You gain a fair idea of your market through research. Also, the objective is always to take your business to a new level by offering the market what it wants. Therefore, the next step you need to take in the PESTLE analysis is to identify the opportunities. You must find out how you can make your goods and services efficient for the consumers. Also, find out what new products you can develop. And try to identify the areas where you can sell your products.

Consider Threats Too 

Along with the opportunities, there are always some threats that may undermine your business. Therefore, it makes it a must for you to give a thought to the threats that your business may face. It will allow you to make strategies to prevent and counter those threats. Or at least, you will be able to reduce its influence of it.

Take Actions Accordingly

These PESTLE analysis steps help you in identifying the opportunities and threats for your business. So, you must use your knowledge wisely and make the strategies that will help your business.

Frequently Asked Questions

Question. 1. What is the use of PESTLE analysis?
Answer. 1. In order to get a piece of contextual information about the direction of the business, the position of the brand, growth targets, and risks to productivity, PESTLE analysis is used.
Question. 2. How does a PESTLE analysis help a business succeed?
Answer. 2. PESTLE analysis is a simple business tool that helps in the success of the business by providing the business owners with an understanding of the wider market in which they are already existing. It widens the understanding of external factors for better business strategies.

By Susan White

Hi, I am Susan White. I am a Senior Marketing Executive and Content Editor at For the past few years I have been working with this company. I hope you liked the post above from one of our team members. If you want to share any improvements or want some more on this blog, please share your request on our email have been in this academic industry for a very long time. You can know more about me from my LinkedIn profile. Below are some of my achievements that I prize:- Successfully published five academic research papers in the marketing field - Assisted hundreds of students get best grades in their courses - Regularly helping my colleagues do their best at their job - Toured several places around the world in the past five years! - A proud mother of a kid! :)Thank you again for reading this article. I look forward to your feedback and continued support.