Are you in need of PESTLE analysis template? You are in the right place. We have designed, collected & displayed some of the best PESTLE templates which you can download and use for free.
This article will also help you to understand how you can do PESTLE analysis effectively using simple step by step process.
You can get inspired by the details alongside downloading any template for free and use them in your business. Without boring you to death, let me quickly tell you about PESTLE analysis.
PESTLE is also called as PEST analysis, and it is usually used in marketing principles. This is a tool that companies make use to monitor and understand their working environment, its operation, planning, and steps taken to launch any service, product, or project newly.
Ok, but the word PESTLE is given in caps which means it has some expansion and the same for the mnemonics is given as Political, Economical, Social, Technological, Legal, Environmental. When you see the development, you can understand that every aspect is covered and hence it helps in analyzing the business and market from various angles. This will allow one to consider every factor and can make a concrete business plan. In short, it is an analysis carried out more elaborative than the SWOT analysis.
Free PESTLE Analysis Templates (Printables)
Importance Of Pest Analysis In Marketing
When you know what PEST is, then comes why it is used. Yes, the need for, significance, importance and however you call it. To know the importance of PEST analysis, you must understand the in-depth details of each factor and find them given below for your perusal.
Let’s take one at a time and deep dive into the analysis. How every factor contributes to the marketing success etc.
Every business depends on the laws and regulations formed by the countries law. In layman words, only the government decides the economy of an industry. For instance, when you see, the tax or duty charges levied on any business will contribute to the revenue generation structure. The company depends on the tax structure, fiscal framework, and trade rates for expanding their business. This PEST plays a role in deciding the marketing strategy of any business.
Performance of the economy has a direct impact on the business. The increase in inflation rates will affect the pricing of any product or service. A company must take this factor into account to decide marketing their products and services. The people in the market will purchase products based on the supply. The supply can increase only when there is a demand. This is a chicken and egg story, and hence economy of a country will influence the marketing plan of any business. Further, economic factors include the inflation rates, commercial growth pattern, foreign exchange rates, etc.
This I will tell you in one line, and you will agree that society has an impact on the marketing strategy making. During the holiday season like Thanksgiving or Christmas, the sales will boost in western countries. Yes, you understand that the culture and population decide in the marketing of a company.
Needless to say that the technology and its advancement will have an impact on the business marketing. The automation, for instance, will bring down the need for handmade products and vice-versa. This means that the company with machines and homemade business people must make a different marketing rule. They must know how to bring automation or advance the existing one to stand in the market.
The legal and political may refer to same with minor tweaking. Yes, both will talk about the law, regulation, etc. to be abided by the business owners. The difference being law won’t frequently change with the changing government. The safety standards, consumer law, and labor law will remain stable for over period. However business must practice following the changes to make marketing plans.
Again environment may look repeat social or economics because it deals with people. The surrounding environment plays a role in the business planning. Industries including tourism, agriculture, farming, etc. not only depend on the climate and global changes but also on the people and the other offsets.
In summary, the PESTLE analysis is essential as the PEST plays a role in affecting the decision on the business. Since L and E are repeated, it is also called a PEST analysis. Some call it PESTEL analysis too. Only people and external factors decide on the marketing plan of a business and hence the company even if they money must depend on PEST to make a proper plan suiting the society.
There are different kinds of templates used by companies for PESTLE analysis, and you can download one or more from here to plan your business and marketing.
Pestel Analysis In Strategic Management
Every enterprise needs to carry out strategic management as it plays a significant role in motivating and monitoring the companies meet their goals. Strategy planning is key to business success. One must think about the company strength like finance, people, and technology. The weakness of the company and based on which must devise a plan to take the business to the next level. Now that you what PEST analysis does, it helps much in making the best strategy for the industry. It helps company carry out business planning accommodating every factor and allows company take a firm decision about business.
PESTLE Factors in Strategic Management
- Political – Copyright, Education, Employment, Corruption, Government Stability.
- Economical – Labor cost, stock market changes, inflation rates, taxes, etc.
- Social – Education level, season, population, lifestyle, and purchasing trends.
- Technological – Advancement in technology, communication medium and methods, automation, etc.
- Legal – Health law, safety law, consumer law.
- Environmental – Weather, climate, eco-friendly products, etc.
Therefore while companies make strategy, they must look at every factor under each PEST section to freeze their plan. Never think planning as a waste of time. It is a one-time investment of time and money for reaping benefits lifetime. If you fail to plan, then you may win one time and not another. Therefore find below two examples in each section that explains how it affects the business. When you read this, then you get convinced that proper planning with strategy will make your skyrocket your business.
I am only giving two examples, and you must use more than that to decide on your business. It’s just a session to make you realize how useful PESTLE in strategic management is.
Examples Of Economic Factors Affecting Business
First I will start with the economic factor. The two example I am taking includes the tax and the labor cost. Changes in tax will indeed have any impact on your business. For instance, the recent GST implementation of tax by Government of India has a significant role in surviving in business. Likewise, a tax of every country will influence the business pattern. The company must consider this factor to decide how much they want to invest, how they want to spend, who all should pay tax, how much tax etc. All these things must be considered before deciding on a new product, service marketing, etc.
Second is the labor cost. The charges in the market in the labor rate are continually increasing. Which means the company must know how much people they want, what skills they look for and how much returns they can contribute to the business etc. Minus all these factors a plan exhibited by the company will only lead to failure and frustration.
Examples Of Legal Factors Affecting Business
Under this section let me take safety law first. You may want to sell a product in the market. Do you know that the product must abide by the safety law failing which your company cannot continue in business? Safety is the prime factor to be looked at by market to sell any service or product. Every company can assure security, but there are specific, measurable standards up to which the company must stand to release any new proposal to the people in the market.
Likewise, health law must be seen by companies. Few countries might not accept a product that does not go with their people due to the health conditions. Then the business cannot make an expansion for that particular product in that country, state or a specific area.
PESTLE Analysis: Legal Factors Affecting Business
Examples Of Political Environment Affecting Business
The foremost example that political environment affects business is the change in the government. Yes, whenever there is a change in the ruling party, then there will be many changes extensive across the nation. This factor plays a more significant role in business planning. Some business might even lose license just because the ruling party has changed. Also, many conditions will change due to the political factor that might favor or reverse any project.
Education also comes under political factor. Yes, the betterment of education is dependent on the political element. Some places that lack training might not receive a service thoroughly than the others. Therefore education and people acceptance must be looked at to expand or wind up business in any particular area.
Examples Of Social Factors Affecting Business
Here take population as an example. Densely populated places might require products and services more than the scarcely populated area. The business must plan to market product accordingly that reaches all people, and only such strategy will receive applause. Alternatively, sometimes barely populated regions might need specific service in the mandate, and when a business fails to look at that, then they lose their name in the market. Looking at such social factors that are crucial, and companies must give importance otherwise business might sink.
Similarly, the lifestyle of people will go with the trend. Business must understand that the people in urban and rural areas will want different service or product. Sometimes same service and product to be marketed in a different way to make them understand. So, people taste and way of living must be considered.
Examples Of Technological Environment Affecting Business
Needless to say that advancement in technology has a role in business planning. When a company stays behind in automation, then naturally they will lose their forefront in the market. They hey plan and take the cost of investing in technology. Also, they must identify talents to use the technology to its best. Only by doing so, the company can make a breakthrough in their business.
Now you know how each factor contributes to success in your planning. Also, understand the benefits of business environment analysis in the next section.
Top 3 Benefits Of Business Environment Analysis
- Reach the Goal
Every company marches forward with great objectives, but that alone will not suffice. As a company, you must know how the environment will receive your plans. If not, then remember that you’re shooting on your foot. Market demand, people interest, economy, etc. must be looked at to devise a plan, and only then you can take a step forward towards success.
- Threat Identification
You must understand environment not only to reach the destination but to cross the hurdles too. The goal is the last step, and the intermediate stages of any threat must be known. You cannot close your eyes to walk on the rope without knowing what will happen when you fall. Agreed that you are a risk-taker, but never take the risk without knowing that it involves risk. Know the environment plan your business take chance and succeed.
- Future Forecast
Upon knowing the market and the threat, it becomes easy to forecast the future. Know the environment to be sure of how much you want to earn. Only when you expect, then you will know if you had a profit or loss. The market study will help you to forecast your future and destiny. No, I do not sound silly here, but I mean it and want you to understand the environment and move forward accordingly.
The Advantages of PESTLE Analysis
How to Create a Pestle Analysis Template
Fine, so far I told you why you need PESTLE analysis template for your business. Also, I told you to use the templates for free. Additionally would like to share the secret of creating the PESTLE analysis template.
You need to open an excel and fill the following headings and subheadings to start your analysis under each section. Just have a mention of what DETAILS you want and what you have ALREADY so that you can analyze each point. I am giving an exhaustive list. However, you decide what will suit your business the best.
Now The Factors List For Your Perusal
- Political factors:
Policies Related to Trading
Shareholder’s details and demands
Inconsistency in the political ground
- Economic factors:
Level of Unemployment
Tends and local economic condition
Interest and Inflation
Issues related to taxation
Overseas exchange rates
Overseas financial trends
- Social factors:
People attitude towards work.
Media angle and viewpoint
Impacting events happening across the world
Changes in law that affects the social factors
Issues related to Ethics
Customer purchasing pattern, consumer opinion, and attitude
Access for Buying
Preferences in Brand
- Technological factors:
Trends in international technical advancements
R & D
Legislations in technical fields
Intellectual property rights and laws
Maturity of the technology
- Legal factors:
Process Defined by Regulatory Authorities
Business specific regulations
Environmental set of laws
- Environmental factors:
Environmental regulations and issues
You can see a big list of factors affecting business, consider as much possible and fill them in the template. Remember to write down the data you have and find the ones you don’t. This systematic approach will help you carry out a detailed analysis.
How To Do A Pestle Analysis Of A Company
Ok, you have created the analysis template or downloaded one relevant to you from here. Now, you must know the right way and the order in which you must conduct the analysis. For example, when you find one thing that will be a roadblock to your plan, then you need to change your policy or stop at once. It depends on which factor ends your analysis. If something that can be adjusted, then you can take another route to execute your plan. But something like the law of a country does not allow then you must stop it at the inception stage to avoid getting your fingers burnt. Let me give you one scenario, you want to start a casino site and have invested time and money. Planning to market the business. If law permits, then you can succeed in that country otherwise you will fail. So you must know when and how to do something. To understand the order in which you carry out the PESTLE analysis for a sure shot winning in your endeavor.
5 Step PESTLE Analysis Process
Step1: Understand the PESTLE factors thoroughly and know its scope in detail.
Step2: Collect Necessary information.
Step 3: Recognize the potential opportunities
Step 4: It is equally important to know the risk factors next to prospects.
Step 5: Get into action.
When to Use a PESTLE Analysis
It is essential to know when PESTLE must be used. Misusing it will do no good and only will cause harm to your entire process.
Use PESTLE analysis for
- Strategic planning
- Research Reports
- Product development
- Organization change
- Marketing planning
- Business planning
- Business development
Even for micromanaging things like what to deliver, when, how and whom can be efficiently analyzed by individual using PESTLE analysis.
How to use PESTLE Analysis – An Example
I would like to go one step forward and explain how to use PESTLE analysis with an example. It will be good to know this for you as you can follow the steps given above and do a specific study. Let me apply the measures to an industry environment analysis example and help you understand how to use the PESTLE in real-time. Let me explain how PESTLE analysis was carried out by a leading non-alcoholic beverage manufacturing company in this section.
- Political – They looked at the FDA in the political factor section as it is vital for a beverage company. They also checked for the government changes and their support for business. The overseas competition also was taken into consideration.
- Economical – Company restructured the marketing and sales campaign due to the dip in the economy.
- Social – They targeted countries that looked for a beverage during festivals. Analyzed people culture and psychology.
- Technological – Started using social media understanding the need for the same. People using TV has come down, and mobile phone and YouTube has caught Hence publishing add in such channels made them successful.
- Legal – To stand the law and regulation, they used lab test to prove the water quality and then confirmed their stand.
- Environmental – This business does not have a direct impact due to biological
It is just one example. Likewise, you must take each factor and analyze based on the nature of your business and the goal.
Advantages And Disadvantages Of Pestle Analysis
Every model with having benefits and limitations. Know the same for PESTLE analysis.
Benefits Of Pestle Analysis
- Cost effective – You can make the analysis once to prevent any expenditure due to improper planning.
- Understanding – Business can understand the market and take steps towards success. There will not be any disappointment and every need including technical can be looked at to address any cropping issues.
- Develop Alertness – Makes every business person to be alert and thus keeps you on the toe to manage the business and people.
- Take advantage of opportunities – It allows you to expand business horizon in the direction it finds strength. In the process of planning one can look at the opening which would have been missed when overlooked due to lack of PESTLE analysis.
Limitations Of Pestle Analysis
- Analyzing dynamic changes in the social and technological area makes PESTLE obsolete and does not offer any help.
- Due to the simplicity of the model, it does not help business in long run.
- It only looks the external environment and forgets to fix the issues arising internally.
Difference Between PEST And SWOT
You will undoubtedly have this question in your mind. Ask me how do I know that? Yes, I had too. Let me clarify your doubt as I did to me. SWOT is Strength, Weakness, Opportunity, and Threat. Know the difference and understand how to use both for better analysis.
SWOT Vs. PESTLE – How To Use Both For Better Analysis
Direct comparison between SWOT and PESTLE cannot happen like an apple to apple. Both are two different tools used to plan for a business etc. Both must be used collectively to do away with one disadvantage over the others. But, good to know the base difference.
|Takes both external (opportunity and threat) and internal factors for analysis||Do not consider internal factors into consideration|
|In-depth external analysis not carried out||Extensive study of external factors are done|
How To Use Both For Better Analysis
When you see the table, you will undoubtedly know that both PEST and SWOT must be combined and that analysis will give your business 100% success. You must carry out Strength and Weakness analysis using SW and then migrate to PESTLE and take each factor to know its OT Opportunity and Threat. So you will start with SW Progress using PESTLE and conclude with OT. If you ask me one single word to tell how to use both I will say SWPESTLEOT. I am glad I made it clear. Trust, I did it.
You can get PESTLE analysis templates in the following format
Feel free to use them for performing a comprehensive PESTLE analysis.
- PESTLE Analysis Powerpoint Template
- Pestle Analysis Template Word
- Pest Analysis Worksheet
- PEST Analysis excel
CIPD PESTLE Analysis
Most of the entry level criterion in Learning and Development and HR department looks for PESTLE Analysis because it is required for the HR department to be prepared for the change. Suggest the best way for embracing and executing the moves. The CIPD PESTLE analysis is the most popular method adopted by companies to check the six factors to take their business to the next level. You can use this planning template to analyze your business plan, marketing plan, HR strategy, etc.
CIPD PESTLE template is simple 4 column template that helps to analyze each factor against external factor, an element within the same industry, and organizational importance.
As a final discussion on PESTLE analysis, I would like to let you know How To Write PESTLE Analysis Report. For doing so, I have taken an example of an apparel company called Giordano located in Hong Kong since 1981 with more than 11000 employees across 40 nations. They have more than 1800 sores.
Write report collecting the following details for an apparel business.
- Regulation related to Pollution
- Tax analysis based on the nation where the store is located.
- Raw material and rising cost.
- Fluctuation in Currency
- Labor cost
- Preference and Taste
- IT systems
- Software technology including ERP, Web designing, and POS.
Legal codes of a specific territory, subcontinent, nation or country where the store is located.
The company every time during planning considers all these factors and expands business across locations.