PEST is an abbreviation for political, economic, social and technological. It's a way of understanding how external forces impact the business. It must be included in every business plan, in addition to a SWOT analysis, as it is part of risk management and strategy design. It was created by Harvard professor Francis Aguilar in 1967.

1. BY
SAMPROTIK ROY
REG. NO:- RA1852001020116
SEC – A
MBA 2ND YEAR

2.  PEST is an abbreviation for political,
economic, social and technological.
 It's a way of understanding how external
forces impact the business.
 It must be included in every business plan, in
addition to a SWOT analysis, as it is part of
risk management and strategy design.
 It was created by Harvard professor Francis
Aguilar in 1967.

3.  It includes the role of government legislation,
initiatives and funding to support the use and
development of e-commerce and information
technology.
 Government regulations and legal issues affect a
company's ability to be profitable and successful, and
this factor looks at how that can happen.
 Issues that must be considered include: -
 TAX GUIDELINES
 COPYRIGHT AND PROPERTY LAW ENFORCEMENT
 POLITICAL STABILITY
 TRADE REGULATIONS
 SOCIAL AND ENVIRONMENTAL POLICY
 EMPLOYMENT LAWS
 SAFETY REGULATIONS

4.  It includes the general wealth and commercial health
of the nation and the elements that contribute to it.
 Economic integration is either external or internal.
 External integration include: -
 The interest rates,
 Exchange inflation,
 Unemployment,
 Gross domestic product,
 Credit availability
 Rise and fall of the middle class.
 Internal integration: -
 Critical business information should be stored in a digital
format and transmitted electronically.
 Internal integration is best exemplified by corporate intranets
like Procter and Gamble, IBM, Nestle etc.

5.  The social factor analyzes the socioeconomic environment
of the market to understand consumer’s needs and what
drives them to the market.
 The factors that must be examined are: -
 Demographics,
 Population growth rates,
 Age distribution,
 Attitudes toward work
 Job market trends.
 Rising standards of living
 Mobile middle class with high disposable incomes
 Busy urban lifestyles
 Lack of time for offline shopping
 Evolution of e-commerce websites such as Amazon,
Flipkart, Snapdeal, ebay etc. has given a big boost to e-
commerce where aggregators get a handsome commission
on every sale from their sellers registered with them.

6.  The Information and communication
technology is a key factor in the growth of e-
commerce.
 It has made communication more efficient,
faster, easier, and more economical
 Due to technological advances economic
transactions have become much easier and
faster
 This has given a big boost to the
development of e-commerce.

7. LIMITATION OF A PEST ANALYSIS :-
• It should be used in conjunction with
• SWOT (strengths, weaknesses, opportunities and threats),
• MOST (mission, objective, strategies, tactics) or
• SCRS (strategy, current state, requirements, solution) analyses.
BENEFITS OF A PEST ANALYSIS :-
• A greater understanding of your company
• More effective long-term strategic planning
• Heightened attention to potential threats and dangers
• Insight for valuable business opportunities

8. THANK YOU