berryl s pestel analysis

7/25/2019 Berryl s Pestel Analysis

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1.0 Introduction

Every organization is confronted with macro-environment, which deals with such

factors that have direct influence on supply and demand of the firm. These factors are

beyond the control of organization agitating it to formulate such strategic measures that

support the organizational goal and strategic planning. The dynamism in the arena of

maret is surfacing such uncertainties that have significance impacts on the functions of

organization. In order to comprehend these vague possible issues, a series of checlists

have been framed to grab an increment in the organizational effectiveness or its survival

to some e!tent. The main framewor widely used with its in depth strategic concentration

on environmental influences is "E#TE$ analysis. This analysis evaluates the e!ternal

environment of the firm on the basis of factors lie political, economical, socio-cultural,

technological, environmental, and legal.

1.1 #mall %edium Industries

&efinition of #%I'#%E(

#%I #mall and medium industries

#%E #mall and medium enterprise

)enerally, #%Es are defined into two broad categories(

1. %anufacturing, %anufacturing-*elated #ervices and +gro-based industries

#mall and medium enterprises in the manufacturing, manufacturing related

servicesand agro-based industries are enterprises with full-time employees not

e!ceeding 10 OR with annual sales turnover not e!ceeding *% million

. #ervices, "rimary +griculture and Information / ommunication Technology IT2

#mall and medium enterprises in the services, primary agriculture and Information

/ ommunication Technology IT2 sectors are enterprises with full-time

employees not e!ceeding 0 OR with annual sales turnover not e!ceeding *%million

In summary, detailed definition of #%Es by size are(

ategory %icro-enterprise #mall enterprise %edium enterprise

1. %anufacturing,

%anufacturing-*elated

#ervices and +gro-based industries

#ales turnover of

less than

*%0,000 3*full time

employess less

than

#ales turnover

between *%0,000

and less than *%10million 3* full time

employees between

and 0

#ales turnover

between *%10

million and *%million 3* full time

employees between

1 and 10
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. #ervices, "rimary

+griculture and

Information /ommunication

Technology IT2

#ales turnover of

less than

*%00,000 3*full time

employees less

than

#ales turnover

between *%00,000

and less than *%1million 3* full time

employees between

and 14

#ales turnover

between *%1

million and *%million 3* full

time employees

between 0 and 0

#ource( http(''www.smi.net.my'5pr6content782

1. "E#TE$ +nalysis

#ource( http(''www.theglobalentrepreneurs.com'global-mareting-intermediate-

and-macro-environment'2

1.9 ompany :acground

:eryl;s hocolate and onfectionary #dn :hd :eryl;s2 was created with

one aim in mind < e!cellence. #ince our establishment in 144, we;ve focused on

ensuring the creation, supply and maintenance of the very best chocolates for both

the %alaysian and international maret. =ith a vision of being a leading

international brand that is synonymous with the highest >uality chocolate

products, :eryl;s has focused on a simple set of values at every step of our

?ourney.

@uality, innovation and the very highest levels of service < these are what we

promise our customers and partners alie. The reason for this dedication is a

simple one as we aim to eep our customers happy. Every :eryl;s product carries

this implied promise of the very best in chocolate products and we believe that the

:eryl;s brand is now synonymous with that e!pectation.
http://www.smi.net.my/?pr_content=7http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.smi.net.my/?pr_content=7http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/


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:eryl;s is after all more than ?ust another manufacturer.

=e commit a substantial amount of time, effort and resources towards the

development of uni>ue chocolate combinations. %any of these use local and

regional ingredients including durians, mangoes and even chilies to create

chocolate blends lie no other. This development process starts however with the

finest raw materials including some of the world;s best cocoa beans from )hana.

The use of the best raw material is, we believe important in ensuring the finest

finished products.

Throughout this development and manufacturing process, we maintain a devotion

to the highest >uality and production standards. This rigor is baced up by a group

of creative and innovative employees who ensure that they eep an eye on what

our customers want. The end result produces high >uality, safe and consistently

e!cellent chocolate products.

Mission Statement

Constantly strive to satisfy customers needs through premium quality products

Stay competitive and enhance our customers enjoyment of the finest chocolates

Provide employees an opportunity to develop their skills

Share our success with employees and shareholders alike

Be responsible to the countries and the communities where we do businesses

#ource( http(''www.berylschocolate.com'eng'greeting.html2

*ange of "roduct
http://www.berylschocolate.com/eng/greeting.htmlhttp://www.berylschocolate.com/eng/greeting.html


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.0 %acro Environment < "E#TE$ Aramewor

PESTEL stands for Political, Economic, Social, Technical, Environment

and Legislative. It is a strategic planning techni>ue that provides a useful framewor for

analyzing the environmental pressures on a team or an organization. "E#TE$ framewor

is considered as the best strategic e>uipment to measure business position and e!pected

relevant growth or decline in the maret and also gives the directions for possible profit

oriented business operation. This analysis wors as a useful tool in planning process

which may includeB organizational planning, strategic planning, financial planning,

mareting planning, product development planning and most importantly in research and

development reports. It is one of the effective tools that summarizes the scattered aspects

in one horizon, especially when entering into the new marets or when the purpose is to

go beyond the geographical boundaries. It helps the organization to eyeshot the

comprehensive realities of the new environment and its maret features which aid to

penetrate in it with most effective strategic concerns and groundings.

9.0 %acro Environment +nalysis for :eryl;s hocolate


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+s already mentioned, "E#TE$ describes five factors according to which

their impacts on the %alaysia based chocolate manufacturing firm is analyzed. These

e!ternal factors and their detailed analysis with respect to firm are e!plained below.

9.1 "olitical Aactor

"olitical factor relates to any changes in the government or its

policies. Every organization is obliged to do its business operation in

compliance with laws made by the government. These laws and rules should

be ac>uainted in the functions performed by the organization. The government

of every country varies with respect to its policy, stability, and ma?or

influences on the trade. In this regard, it is most appropriate for any

organization to conduct its operation and formulate its strategic plan in

accordance with the political theme of the country. Every strategic plan must

cater the importance of political impacts so that effective strategy is built to

mae proper alignment and the ris of pro?ect failures due to political

instability is already comprehended with alternative choices "orter, 144C2.

In the given scenario of chocolate manufacturing industry operating in

%alaysia has to analyze that the political stability in the e!isting country is

pretty much secured. The impacts of political influences on the sale of the

chocolate products and its manufacturing will be observed when this

organization will intervene in such practices that are not supported by the

government. )overnment can intervene in the operations which are not

environmental friendly and the issues of such lie are the impacts that

chocolate manufacturer will have to face from the political point of view. +s a

democratic political influence, the firm can grab ma!imum advantages in


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terms of low restrictions on the volume of production and sales scale. Dence,

there are political issues that may affect the industry and their impacts can

only be minimized if the company is already prepared to handle political

matters of %alaysia.

9. Economy Aactors

Economic conditions of the country is the most important factor of

analysis to any country because it decides the successful and failure of any

business profitability =orrell, 144C2. Every business wors on the core

concept of economics that e!plains the importance of demand and supply. If

the demand is low because of low economic growth and development then it

will destine the company to raise such amount of capital that will ultimately

meet the e!pected profit after covering the cost incurred. %aing buls of

production on ?ust forecasting without considering demand pattern of the

country may cause an irreparable loss to the company no matter how effective

was the strategy and planning.

This is due to the fact that economic influences of the country are

beyond the control of organization and it is bound to reflect bac in

accordance with economic situation. If the organization gives high concerns to

the economic choices, then it is beyond any nagging doubt that it can mae

successful profits even in the realm of recession. 3n the contrary,

organizations eeping aside these economic conditions cannot even survive in

economic boom. The economic conditions of any country act as an

opportunity as well as threat depending upon the strategic planning made by

the firm. If the firm gives high degree of concern to the economic choices


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even in the depressed economic state can mae its survival and the firms

ignoring them will be seen as going out of the maret.

It can be articulated with certitude ?ustification that %alaysian

chocolate industry is most developed and competitive sophisticated maret in

the world. The greatest share of maret is captivated by global chocolate

industries which include estle, %ars, and adbury. In the presence of such

global giants it is very difficult for new entrants to fetch their position in the

maret but the economic system and growth of chocolate maret is such that

even new entrants can entertain the customer with good profitability.

The chocolate maret should mae contracts with cocoa beans farmer

to apprehend the price fluctuations under control. The increase in advertising

and promotions cost will yield higher margin in sales and profitability because

of increased customers; interest in buying chocolate. The reason that argues

the increase in promotion is because chocolate is a lu!ury product and

customer will not buy until it is preceded with high promotion efforts in the

arena of maret where recession is e!pected to strie and profitability in the

lu!ury maret is at stae.

9.9 #ocial Aactors

The socio-cultural environment of the country has significant

impact on the demand of the product or services. This is the reason that

organizations mainly manufacture the products according to the taste and

demand pattern of the nation in which it is operating. Especially, in industries

where the taste and variety of the food products vary from country to country

according to the socio-cultural environment. %ost importantly, the


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consumption behaviour has significant impact on the product sales and in

reflection to this companies have to consider demographics changes of the

customer. ompanies have to select the specific demographic segment and

produce such goods which are in compliance with socio-economic norms of

that particular segment.

hocolate is a food product which has in depth relation with health

yielding the fact that chocolate industry has to penetrate in the maret with all

factors concerning health issues. In %alaysia, costumers are becoming more

health conscious and provide an opportunity for the chocolate maers to

diversify the product with different flavours and healthy ingredients. The

chocolate consumption is seen to have more consumption in young age

children group and teenagers. This reflects that the chocolate company has to

eep its focal point on the tastes of young customers and such modifications

in the chocolate that urges the consumers to give a taste at least once in a year.

Aor instance, chocolate in the form of bar has attained much more popularity

in %alaysian maret.

9.F Technology Aactor

+ company can achieve greater success and competitive advantage

in the maret by emphasizing on the aspects of technological factors as a

strategic concern "orter, 00F2. The increased pace of technology have

revolutionized the scope of marets. The emerging technologies are pro?ecting

new opportunities to the new marets and giving threats to the e!isting one

surfacing the fact to compensate with new technology has become optimum

intrinsic need %iddleton, 0092.


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In the chocolate manufacturing company, technology can be the most

effective tool in product development, advertising, and promotion.

Technology can alter the process of production and can yield higher >uality

product at much less cost. It can also support in building a strong brand name

and product portfolio by adopting digital media to promote products. It is a

lu!ury food productB therefore, it demands a mass promotional effort to

persuade the customers to buy. Dence, the e!isting available technology in

%alaysia has much significant importance on the chocolate industry and the

industry has to adapt the concerned technology in order to captivate greater

maret share.

9. Environmental Aactor

Every organization operates in a society and it has certain

obligations with respect to its welfare. The overall environment is comprised

of many elements which organization has to cater before conducting its

business operations. In case of chocolate manufacturing firm operating in

%alaysia, has to analyze the climate factor of the environment as the greatest

opportunity. The climate of %alaysia is pretty much hot, giving high

importance to products which have cold impacts on human health and the

chocolate is the product which is more useful in hot weather in this regard.

#imilarly, there are other factors as well which the chocolate company has to

etch in its strategic decision maing out which corporate social responsibility

is the prior most to identify in the sense that manufacturing process and their

operations have least impacts on the society and on overall environment.


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9.G $egal Aactor

It is a well nown fact that every organization has to

conduct its operation which compliance with the laws of the country. The

trade laws, rules and regulations direct all the companies to set their

pricing policy, production policy, and strategic policies according to the

country mercantile laws. The chocolate industry has to anticipate the

outcomes of their business operations in such a way that are in abidance

with the rules and regulations made by the government of the country.

$ie in %alaysia, there are set of general accepted rules and standards for

the safer and healthier food products which must be met in chocolate

products of the company. Ignoring such legal consideration can cause

irreparable harm to the industry and that should not be the practice by the

chocolate manufacturing company because %alaysian government does

not give fle!ibility to any size of industry which gives least consideration

to laws and regulations.

F.0 onclusion

hocolate is a lu!ury food product which can draw an important analysis from the

framewor of "E#TE$. In a nutshell, it can be said that "E#TE$ analysis is a useful

framewor to understand the e!ternal environment in which an organization operates.

The snapshot of this analysis is discussed with respect to chocolate manufacturing

company conducting its operation in %alaysia. +mong the si! factors, socio-cultural,

political and technological factors are the most important issues.


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The social-cultural impacts of the environment on chocolate industry are

important because it can be viewed as an opportunity as well as a threat to the industry.

+s a lu!ury food product, customers always have changing demand pattern in the tastes

of such lie products. The importance of political factor in chocolate industry is

considered because the production of cocoa been is an issue in most of the countries and

many government restricts the import of cocoa beans from some of the +frican countries

because of their child labour involved in producing cocoa.

The chocolate industry is mainly dependent upon the mil as the basic raw

material for manufacturing the products. The advancement in technology has introduced

such machines which are specifically made for miling cows in the most efficient and

hygienic manner. The pacaging of chocolate products is yet another dimension where

the use of technology can reduced many wastes. The modern trend of technology has

introduced such digital ways that can multiply the sales of chocolate in the country lie

%alaysia where the e!posure of media and technology is worthwhile.


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*eference(

1.0 http(''www.smi.net.my'5pr6content78

.0 http(''www.theglobalentrepreneurs.com'global-mareting-intermediate-and-macro-

environment'

9.0 http(''www.slideshare.net'.shofi>'environment-of-entrepreneurship-development

F.0 "orter., %ichael E. 14C02. Competitive Strategy : Techniques for Analysing

Industries and Competitors. ew Hor( Aree "ress

.0 Disrich, *obert 0042,Entrepreneurship.%c)raw-Dill'Irwin
http://www.smi.net.my/?pr_content=7http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.slideshare.net/k.shofiq/environment-of-entrepreneurship-developmenthttp://www.smi.net.my/?pr_content=7http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.theglobalentrepreneurs.com/global-marketing-intermediate-and-macro-environment/http://www.slideshare.net/k.shofiq/environment-of-entrepreneurship-development

berryl s pestel analysis

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