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How Do I Write a PEST Analysis Report?

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  • Written By: Esther Ejim
  • Edited By: Kaci Lane Hindman
  • Last Modified Date: 21 August 2016
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The way to write a Political, Economic, Social, and Technological (PEST) analysis report is to consider each of the factors for which it stands that affect, or are likely to affect, a company. The PEST analysis report is a strategic business tool used by businesses to find out their current standing in a competitive market with the aim of utilizing this knowledge to restructure the business. It is also used by those wishing to start a business to find out how such an organization can be positioned for success.

An example of a political factor to consider when writing a PEST analysis report is the stability of the government. A business located in a country with a stable government may count it as a positive factor. Government regulations and policies also play an important role in the success of a business. For instance, a company that manufactures rubber sandals may be affected by a ban or trade limitation on the importation of raw rubber into the country. Another example is a furniture store that may be affected by government regulations increasing the custom duty on imported furniture. This may cause the company to compensate by increasing the price of imported furniture. Customers who are not happy with the increase may rebel by focusing on cheaper, locally produced furniture.

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An economic factor to consider when writing a PEST report is the spending habits of consumers, which may be influenced by dips and rises in the business cycle. A recession could also negatively affect or positively affect a business, depending on the type of product or service it offers. Luxury goods are the first items to be struck off the list of consumers during a recession. Basic goods or lower priced products may experience a boon. For instance, a dollar store may see an increase in profit from more consumer demand during a recession.

Sociocultural factors must be included when writing a PEST analysis report. This includes aspects like the social norms and cultural habits of consumers, which may influence the way they spend money on goods and services. Another factor that is included in sociocultural factors is religion, and its effect on the spending habits of consumers. Technological factors must also be included when writing the PEST analysis report, since technological advances often play an important role in the success of a company. It may also affect the way a company operates. For instance, advances in technology have made it easy for most companies to use automated systems instead of live customer service representatives to answer some simple questions from customers over the phone.

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