PEST analysis is used to analyze the external factors that may affect a business or project. It stands for the analysis of political, economic, social, and technological factors. PEST looks at laws, regulations, taxes, inflation, consumer trends, technology innovations, and other macroenvironmental factors. Unlike SWOT analysis, PEST focuses solely on external factors rather than both external and internal factors. PEST is useful for conducting market research and understanding the broader business environment.

1. What is PEST Analysis?
PEST stands for the analysis of the external factors which
are beneficial when conducting research before
beginning a new project or to help conduct market
research. These factors are:

2. • Political - Laws, global issues, legislation and regulations which
may have an effect on your business either immediately or in the
future.
• Economic – Taxes, interest rates, inflation, the stock markets and
consumer confidence all need to be taken into account.
• Social – The changes in lifestyle and buying trends, media, major
events, ethics, advertising and publicity factors.
• Technological – Innovations, access to technology, licensing and
patents, manufacturing, research funding, global
communications.
• Pest can also be known as PESTLE which includes other factors
such as:

3. • Legal – Legislation which has been proposed and may come
into effect and any passed legislations.
• Environmental – Environmental issues either locally or
globally and their social and political factors.
• Unlike SWOT this strategy is more directly aimed at the
external macro environmental factors that might be
affecting the position of your business, the reasons behind
growth or decline in the market and also identify new
directions for the business as a whole.

4. Comparing SWOT Analysis vs. PEST Analysis

6. The disadvantage of PESTLE analysis
is it doesn’t consider the internal
factors of your organization. It
deeply analyzed the external factors
that might affect your project or
organization.
SWOT analysis considers both the
internal and external factors. It
captures the external factors in the
opportunities and threats section.

8. Micro-environment and its factors
These forces or factors include suppliers, shareholders, customers, employees, competitors, media, etc.
Macro Environment and its factors
 General and external environment that impacts the
working style, decision-making process, strategy, and
performance of the business.
 is a dynamic environment that has a changing
tendency.
 It has external factors that an organization can’t control.
The macro-environment study is termed as PESTLE
analysis that includes different external environment
factors or forces like:
 Political forces
 Economic forces
 Socio-cultural and demographic forces
 Technology forces
 Legal forces
 Ecology and physical forces
 Authority of the Manager

10. Thank you
and keep
safe
students!