The document discusses various PEST factors that affect e-commerce. Political factors include tax policies, government stability and regulations, import restrictions, and intellectual property laws. Economic factors that influence e-commerce are inflation, interest rates, and the level of money in circulation. Social factors comprise growth in foreign markets, privacy/security concerns, and rising living standards. Technological factors cover web terminology, infrastructure, legislation, and secure systems for transactions.

1. PEST FACTORS AFFECTING
E COMMERCE
S.SUBHA
2ND MBA

2. POLITICAL FACTORS
• While the threats may not be the same before the e-retailers as the physical retailers, still there are several
political hurdles .
• The huddles are:-
 Tax policy (tax rates and incentives)
 Government stability and related changes
 Government involvement in trade unions and agreements
 Import restrictions on quality and quantity of product
 Intellectual property law (Copyright, patents)
 Consumer protection and e-commerce
• Effects of political factors:-
• Impact on economy
• Changes in regulation
• Political stability
• Mitigation of risk

3. ECONOMIC FACTORS
• Levels of Inflation
Inflation is the sustained rise in the prices of products. Rising inflation affects the demand for
e-commerce goods or services because it reduces the number of items consumers can afford.
This affects your e-commerce business, particularly if you deal in nonessential or luxurious
items
• Rates of Interest
Low interest rates encourage borrowing, while high interest rates discourage borrowing.
Prevalence of low interest rates boosts e-commerce business because it increases the amount
of money in circulation as a result of heightened lending and borrowing activities in the
financial sector. Consumers can spend more on your e-commerce products when they have
more money at their disposal. In contrast, high interest rates stifle money circulation and
suppress demand for e-commerce products.They also increase the financing costs of your
business, especially if you borrow loans with variable interest rates

4. SOCIAL FACTORS
• Growth of foreign markets
• Privacy and security issues
Customers are reluctant to buy online ,reluctant to disclose their confidential
data such as home address ,identification number and credit card details
• Rising standards of living and a burgeoning ,mobile middle class with high
disposable incomes ,busy lifestyles ,urban traffic congestion and lack of
time for offline shopping have given boost to e-commerce.

5. TECHNOLOGICAL FACTORS
• Understanding WebTerminology.
• Technology legislation
• Internet/broadband – consumer & business markets
• Technology infrastructure in a country (Web/Broadband/Mobile)
• the technologies offer consumers and businesses more innovative products
and services such as Internet banking, new generation mobile telephones
• Secure Systems: encryptions, digital certificates, SSL (secure sockets layer
protocol mechanisms)