This essay will demonstrate that SWOT and Pest analysis, in a business, are efficient tools if used with planning and the right level of business expertise. Firstly, this essay will introduce and define both SWOT and PEST analysis and describe how they are carried out. Secondly, it will explain when and why these tools are used, in business, using case studies. Finally, it will illustrate the advantages and disadvantages of using a SWOT and PEST analysis.
A SWOT analysis is an acronym for Strengths, Weaknesses, Opportunities and Threats. This tool takes into consideration both internal and external factors, strengths and weakness being internal and opportunities and threats being external. Strengths focus on success within the company and how …show more content…
Political factors determine the way the government regulations and legal factors may affect the business such as introducing a new tax (Makos, 2013). For example, a business has to take in consideration the foreign policy of a country as it plays a significant role in verifying the trade regulations (Makos, n.d.). Economic factors investigate issues in the economy that will have consequences on the business such as exchange rate and unemployment rate (Makos, 2013). An example of an economic factor is exchange rates as it can affect the business by affecting the prices of goods which are imported an exported around the country and the world (Makos, n.d.). Social factors analyse the customer sectors in the economy, therefore it looks at how to make sure a customer purchases the product (Makos, 2013). Social factors look the age range, population and its growth rate which will help the company produce market research leading them to create products that the customer will purchase (Makos, n.d.). Technological factors assess how a product should be introduced to the world and therefore research via the internet and social media has to be conducted (Makos, 2013). For example, the business has to look out for technological changes in the markets as they don’t want to fall behind their competitors (Makos, n.d.).To perform a PEST
A SWOT analysis is an acronym for Strengths, Weaknesses, Opportunities and Threats. This tool takes into consideration both internal and external factors, strengths and weakness being internal and opportunities and threats being external. Strengths focus on success within the company and how …show more content…
Political factors determine the way the government regulations and legal factors may affect the business such as introducing a new tax (Makos, 2013). For example, a business has to take in consideration the foreign policy of a country as it plays a significant role in verifying the trade regulations (Makos, n.d.). Economic factors investigate issues in the economy that will have consequences on the business such as exchange rate and unemployment rate (Makos, 2013). An example of an economic factor is exchange rates as it can affect the business by affecting the prices of goods which are imported an exported around the country and the world (Makos, n.d.). Social factors analyse the customer sectors in the economy, therefore it looks at how to make sure a customer purchases the product (Makos, 2013). Social factors look the age range, population and its growth rate which will help the company produce market research leading them to create products that the customer will purchase (Makos, n.d.). Technological factors assess how a product should be introduced to the world and therefore research via the internet and social media has to be conducted (Makos, 2013). For example, the business has to look out for technological changes in the markets as they don’t want to fall behind their competitors (Makos, n.d.).To perform a PEST