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The PEST Analysis is quite similar to that of the SWOT analysis (Srdjevic et al. Switzerland is one of the largest economies in the world. The A.I transmits data to the cloud. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. The Hersheys Company is the largest chocolate manufacturer in North America and yet theyve hit major setbacks both politically and economically. In 2011, it is seen that major chocolate . Intellectual property laws, such as those related to trademarks and patents for unique chocolate products or manufacturing processes. Attitude towards immigration has come under sharp focus. Which dollar? 5. PEST is an acronym that stands for Political, Economic, Socio-cultural and Technological. Packaging: There is a growing demand for sustainable and eco-friendly packaging solutions, which has led to the development of new technology for biodegradable or compostable packaging materials. - Democracy & Other Democratic Institutions According to Linda A. Hill, Alison Berkley Wagonfeld the democratic institutions are needed to be strengthened further so that business such as Chocolate Hawkins can thrive in an open, transparent and stable political environment. PEST ANALYSIS The PEST analysis is a useful tool for understanding market growth or decline and as such the position potential and direction for a business. Introduction In 1966 Carl Kirkland co-founded Kirkland's in Jackson, Tennessee (Kir15). - Transparency & Digital Drive Chocolate Hawkins can use digitalization of various processes to overcome corruption in the local economy. If the legal system is not strong then Chocolate Hawkins can face numerous challenges from consumer petitions to shakedowns from authorities. Objective 3. Many US companies have incurred losses in Mexico in regular forex crisis in that country. PESTLE Analysis of Soap Industry in India, PESTEL Analysis of Starbucks in Philippines. Consumer consciousness regarding the health benefits of eating high-quality chocolate, which remains the key driver of the market. An Analytic Study of Organic Food Industry as Part of Healthy Eating Habit in Turkey: Market Growth, Challenges and Prospects. It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. For example Uber employment system is not consistent with French laws and it is facing challenges in the country. INDUSTRY ANALYSIS PESTEL Analysis Economic Factors The Philippine economy is progressively increasing according to the World Bank Org. This lack of clarity and responsibility highlights the company's failure to take action despite having all the resources and power to reduce child labour. - Financial Market Structure and Availability of Capital at Reasonable Rates The quantitative easing policy of Federal Reserve has led to liquidity flooding all across the global financial markets. In practice, analyses based on the PESTEL model are used in conjunction with studies on the micro-environment as part of the overall . Managers at Chocolate Hawkins need to examine three inter-related environments in order to come up with an effective strategy. Sep 2014. Economic Status. Our Twitter PESTLE analysis highlights the external factors, like political, economic, social, and technological ones, Cybersecurity is an increasingly important field of work. Business do face problem when the conflict is between public interest and proprietary technology similar to ruling in South Africa where government & judiciary allowed generic AIDS drug irrespective of patents of global companies. It will help Chocolate Gourmet in both developing environmentally friendly products and thwarting PR stumble blocks. - Gender Composition in Labor Market Chocolate Gourmet can use gender composition of labor market to understand the level of liberal nature of the society, women rights, and womens say in matter of societal issues and consumption decisions. Chocolate Gourmet should be careful about the history of forex risk before entering new market. Dec 31, 2014 by PESTLEanalysis Contributor Cadbury is synonymous with chocolate consumption worldwide. Save my name, email, and website in this browser for the next time I comment. - Securities Law What are the securities law in the country and what are the conditions to list the company on national or regional stock exchange. Published by HBR Publications. Case Description of Digital Chocolate Case Study Trip Hawkins founded Digital Chocolate in Silicon Valley in 2003 to develop outstanding games for mobile devices. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. Much of this gain in retail value could be attributed to a shift of U.S. consumers toward higher priced chocolates. An even better option is Fair Trade Chocolate. Experience economy is one of the fastest growing segments both among millennials and among baby-boomers. While also keeping the ingredients simple to maintain environmental sustainability. Digital Chocolate case study (referred as Chocolate Hawkins for purpose of this article) is a Harvard Business School (HBR) case study covering topics such as Organizational Development and strategic management. - Regulatory Practices - The regulatory practices are streamlined with global norms which have helped the country to improve its ease of doing business ranking. It is commonly used in desserts, confections, and as a flavouring ingredient in various foods. This analysis is also performed to assess the potential of a new market. Lindt PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. If the legal system is not strong then Chocolate Gourmet can face numerous challenges from consumer petitions to shakedowns from authorities. Whereas it will reach USD 2.11 Bn by 2029 with a significant growth rate of 3.28% Chocolate is a very popular and sweet, food item made from cocoa beans. The Chocolate Confections Corporation PESTEL Analysis will look at the external factors - political, economic, social, technological, environmental, and legal. - Attitude towards Authority Various cultures in different part of the world have different attitude towards authority. And while Dairy Milk chocolate and Trident Gum sold well, other brands like Halls also saw a rise in their annual sales. Government policies: Taxation, trade policies, and regulations can impact the cost of production and distribution of chocolate products, affecting the profitability of the industry. Although it took up aisle space, if it leads to creates even one sale, its worth the price to retailers and Hersheys. Today, Kirkland's main sales support center is located in Brentwood, Tennessee which supports 337 stores in 35 states. - Influence of Climate Change How climate change will impact Chocolate Gourmet business model and supply chain. This is why theyre using A.I to improve their products and encourage more sales. Add if theyre not, then poor sales are obviously their fault right? For example most of EU countries now want the EU citizen data to be saved in EU countries only. - Fiscal and Monetary Policies The Republican government tax break culture has increased the deficit and it can lead to fiscal trouble for the economy in coming years. Feb 20, 2023 (The Expresswire) -- "Liqueur Chocolate Market" new research report for [2023] provides a comprehensive overview, including market size, share, growth rate, PESTEL analysis, SWOT . In 2015, the company blamed American consumers for not buying more chocolate. The chocolate market was impacted by low sales volume due to the COVID-19 pandemic, including supply-side issues linked to quality and certification. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. The PEST analysis looks at four types of external environmental elements: P -Political factors in an economy include various forms of government intervention and political lobbying, such as . environmental. But on the flip side it does increases both time and cost of doing business and getting certifications and clearances. Technology is fast disrupting business models across various industries. Legal factors often govern conditions to enter the market, laws to operate in the market, and procedure to resolve any dispute with other stakeholders. Some of the technology trends that are impacting the macro environment are developments in artificial intelligence, use of machine learning and big data analytics to predict consumer behavior, growing importance of platforms over service providers etc. PESTLE analysis of chocolate industry in JAPAN. Political environment and other factors not only impact the cost of doing business but also long term sustainability. PESTLE Analysis for Cannabis Startups PESTLE is the acronym for a framework which analyzes the Political, Economic, Social, Technological, Legislative, and Environmental (mostly in the ecological sense) factors that have direct and indirect impacts on a business. A Comprehensive Project report on Chocolate Industry Bhavik Parmar Follow Co-Founder And MD at KadiBuddy Advertisement Advertisement Recommended Final report on chaco Shailesh Kumar 3.7k views 66 slides Chocolate industry project report hasnain2 6.2k views 74 slides Chocolates & confectionery Varun Deshpande 18.6k views 29 slides The imposition of taxes is yet another political factor that will determine how Cadbury manages its investment and payment to shareholders. But its still a business at the end of the day; higher returns are most important for its survival. India's strong economic growth over the past decade has catalyzed the country's per capita disposable incomes . Mars Incorporated. As such, theyre looking to bring more good into the world by building thriving communities and becoming better stewards of the planet. - Environmental Standards and Regulations both at National & Local Levels Often the environment policy at national and local level can be different. Chocolate industry Presentation 1. 3. They include political policies and stability as well as trade, taxation and fiscal policies ". -Environmental policy is very important to Lindt and Sprngli. Developing strategies that can capitalize on Chocolate Gourmet strengths and help mitigate weaknesses and impact of threats of macro-environment. This is where the PESTEL analysis comes in handy as a useful tool for identifying the external factors that could affect the chocolate industry in the UK. Secondly governments from all parties adhere to the treaties made by the previous governments. The Hershey Company PESTEL analysis is a strategic tool to analyze the macro environment of the organization. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. - Per Capita and National Carbon Emission What is the per capita carbon emission of the country and what is the overall level of carbon emissions of the country. And even before that in 2007, Cadbury Schweppes decided to outsource a major portion of its accounting and HR to an Indian firm in the face of increasing operational expenses and reducing margins. Competition: The level of competition in the industry can affect pricing, marketing, and innovation, which can impact the profitability of individual companies. Chocolate Hawkins should have capabilities to navigate under this hyper sensitive environment. Major Players 8. - Time Taken for Court Proceedings Even if the country has best of the laws, it doesnt mean much if they cant be enforced in a timely manner. - Attitude towards Authority Various cultures in different part of the world have different attitude towards authority. You can download Excel Template of PESTEL / PEST / STEP Analysis & Solution of Note on the U.S. Chocolate Market, Copyright Executive MBA Pro Resources 2022, BCG Matrix / Growth Share Matrix Analysis, Case Study Solution & Analysis of Note on the U.S. Chocolate Market, SWOT Analysis of Note on the U.S. Chocolate Market, 5C Marketing Analysis of Note on the U.S. Chocolate Market, 4P Marketing Analysis of Note on the U.S. Chocolate Market, Porter Five Forces Analysis and Solution of Note on the U.S. Chocolate Market, Porter Value Chain Analysis and Solution of Note on the U.S. Chocolate Market, Case Memo & Recommendation Memo of Note on the U.S. Chocolate Market, Blue Ocean Analysis and Solution of Note on the U.S. Chocolate Market, Marketing Strategy and Analysis Note on the U.S. Chocolate Market, VRIO /VRIN Analysis & Solution of Note on the U.S. Chocolate Market, PESTEL / STEP / PEST Analysis of Note on the U.S. Chocolate Market, Case Study Solution of Note on the U.S. Chocolate Market, SWOT Analysis and Solution of Note on the U.S. Chocolate Market, Kirin Brewery Co., Ltd.: The Dry Beer War PESTEL / PEST / STEP Analysis & Solution, Monsanto and Genetically Modified Organisms PESTEL / PEST / STEP Analysis & Solution, Cola Wars Continue: Coke and Pepsi in 2006 PESTEL / PEST / STEP Analysis & Solution, Bitter Competition: The Holland Sweetener Co. vs. NutraSweet (G) PESTEL / PEST / STEP Analysis & Solution, Coca-Cola FEMSA's Contribution to Peace PESTEL / PEST / STEP Analysis & Solution, Vincor and the New World of Wine PESTEL / PEST / STEP Analysis & Solution, Arcor: Global Strategy and Local Turbulence (Abridged) PESTEL / PEST / STEP Analysis & Solution, Marks and Spencer Ltd. (A) PESTEL / PEST / STEP Analysis & Solution, PepsiCo: The Challenge of Growth Through Innovation PESTEL / PEST / STEP Analysis & Solution, Adam Baxter Co./Local 190: 1985 Negotiation, Local 190 Confidential Information PESTEL / PEST / STEP Analysis & Solution. Rocky Mountain Chocolate Factory, Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Amul Chocolates is a product category of the milk company Amul which is the brand name for the Gujarat Cooperative Milk Marketing Federation. In doing so, theyre committed to being more transparent about the ingredients. Execution of the strategy and building a feedback loop, using which managers at Chocolate Hawkins can fine tune processes and strategies going forward. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. The use and consumption of raw organic chocolate are growing in popularity in the raw food and vegan scenes. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. - International Trade & Other Treaties The country has a good record of adhering to international treaties it has done with various global partners. Cadbury is a well-known producer and distributor of chocolate and milk-based products. This can help Chocolate Hawkins in numerous decisions such as plant location, product development, and pricing strategy. This will help in better predicting the environment policy of the country. PESTEL analysis is mainly the assessment of macro environment factors. - Nature of Social Contract between Government & Society Before entering into a market Chocolate Gourmet needs to understand the nature of social contract between government and society. According to an estimate, Nestle, Dr. Pepper Snapple, Coca-Cola, Pepsi, and Danone recycle approximately 6.6% of the bottles annually. For launching a new product we use PESTLE or SWOT strategies and let us Consider that we are launching a new chocolate product . - Government Spending As mentioned in the political factors, government of the country is running deficit budgets. There are four major factors identified to capsulate the different factors found from the different environmental influences. - Consumer Protection Laws Chocolate Hawkins needs to know what are the consumer laws, what is the rate of enforcement, what is the attitude of authorities towards consumer protection laws, and what is the role activist groups in enforcement of consumer protection laws. In one respect, Cadbury was born as a result of social factors. Chocolate Industry in India 7. The Company has various popular products in the Petcare as well as in the chocolate category for example; in the Petcare industry Pedigree, Royal Canin, Whiskas etc. This can help Chocolate Gourmet to bring in more transparency and make supply chain more flexible. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. The government of each party has adhered to the treaties done by previous governments, so there is a consistency in both rule of law and regulations. If youve ever enjoyed the classic Hersheys, Kit Kat, or Reeses Peanut Butter Cups, then youve been a consumer of the Hersheys Company. With almost 1.4 billion Chinese inhabitants and a growing middle-class, it is a wonderful opportunity for brands to conquer and retain a wide audience. Being run by a Quaker family, their opposition to alcohol served as the basis of running a business that sold tea, coffee, cocoa, and liquid chocolate. Many nutritionists recommend people to reduce their consumption of chocolate and candy, which is likely to affect Cadbury sales in the future. Regulations: Regulations on food safety, labeling, and advertising can impact the manufacturing and marketing of chocolate products. View. Chocolate in a Bloom 6. Perhaps it was also the consumers, who (according to Hershey) werent going to stores. Research Methodology 4. When too heavy, additional ingredients go to waste. If they were to save money here, itd be a higher return. It can enable Chocolate Hawkins to hire skilled workforce at competitive salaries. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. Glenn Carroll, Greg Powell (2018), "Note on the U.S. Chocolate Market Harvard Business Review Case Study. Chapters Research Methodology Study of Global Market Study of Indian Market Product Profile Demand Determination of Chocolate Industry Distribution channel in chocolate industry Key issues & current trends PEST analysis Michel Porter's Five Force Model Other Portfolio Model Financial Analysis Opportunity . 4. Yasemin Oraman. it can be said that PESTEL analysis is a useful framework to understand the external environment in which an organization operates. - Attitude towards Health & Safety The attitude towards health and safety is often reflected in the quality of the products and cost structures of manufacturing processes. 2. PESTLE The SWOT analysis for Lindt & Sprngli is presented below in a table followed by the detailed analysis report. Free Summary Report This report contains the table contents only. Ethical and sustainable sourcing: There is increasing concern among consumers about the environmental and social impact of chocolate production, including issues related to child labor, deforestation, and fair trade. We will make special emphasis on Cadbury UK, as this is where the company originally began. But this strategy entails risks when interest rate will go up. Chocolate ingredients are more expensive. In 2000, 81% of U.S. adults consumed chocolate. The PEST Analysis is mainly used for tactical planning, promotion planning as well as industry and the development of manufactured goods. Trip Hawkins founded Digital Chocolate in Silicon Valley in 2003 to develop outstanding games for mobile devices. . - Time Taken for Court Proceedings Even if the country has best of the laws, it doesnt mean much if they cant be enforced in a timely manner. Chocolate Hawkins needs to be careful about building marketing strategy that is dependent on Purchase on Credit consumer behavior. All Rights Reserved, Political factors: The politics and policies of chocolate, Economic factors: All problems, all the time, Social factors: A dedication to social responsibility and favor, then poor sales are obviously their fault, adopting new technology to create better treats, add this A.I technology to every one of their lines, the consumer pushback against their usage of the Ivory Coast (and potentially child labor), Twitter PESTLE Analysis: 6 Notable Factors Affecting the Social Network, How to Pursue a Career in Cybersecurity: 7 Professional Tips to Follow, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor. The Industrial Organization (I/O) approach advocates that for sustainable competitive advantage external factors are as important as internal factors of the Chocolate Hawkins. Chocolate Gourmet can make strategies based on the stable political environment. PESTLE ANALYSIS TECHNOLOGICAL ANALYSIS The Goya chocolate has a global supply chain. -Kew raw materials are sourced from local suppliers. Some of the legal factors that may impact the chocolate industry in the UK include: Some environmental factors that may affect the chocolate industry in the UK include climate change and its impact on cocoa production, deforestation and habitat destruction in cocoa-growing regions, resource consumption and waste generation in the manufacturing process, and the environmental impact of packaging and transportation. This will enable the Chocolate Hawkins to determine if required can it hire talent globally to work in that particular market. - Acceptance of Mobile Payments and Fintech Services One of the areas where US are lacking behind China is Mobile Payments. Much of this gain in retail value could be attributed to a shift of U.S. consumers toward higher priced chocolates. - Segregation of Political Responsibilities between Different Government Agencies There are numerous government agencies which reduces the risk of overwhelming pressure by one agency. Health trends: The UK government has launched several campaigns in recent years to promote healthy eating, which may impact the marketing and consumption of chocolate products. Even though the global economic downturn did affect Cadburys expansion plans (owing to a reduction in disposable income of customers and other stakeholders), sales actually remained quiet steady. The PESTLE analysis was conducted in order to find out the opportunity of chocolate confectionery in the UK. U.S. retail chocolate sales were forecast to grow to $14.5 billion in 2007. Brexit: The UKs departure from the European Union may have an impact on the chocolate industry, such as changes in trade agreements and regulations. - Securities Law What are the securities law in the country and what are the conditions to list the company on national or regional stock exchange. The total retail value of the U.S. market for chocolate was estimated at $13.7 billion in 2002, a 10.2% increase from 1998. Temperature greatly affects the condition of the licorice; too much heat makes it heavy, while too much cold makes the candy lighter. It is also imperative to use technology to create competitive advantage in the industry. - Political Governance System Based on the information provided in the Note on the U.S. Chocolate Market case study, it seems that the country have a stable political system. S - Social. Feel free to connect with us if you need business research. Know More Egypt SWOT Analysis This market research report covers SWOT (strengths, weaknesses, opportunities and threats) analysis for Egypt. 5. Required fields are marked *. One way to start is by closely mapping the changes in consumer buying behavior and emerging value proposition. The alcoholic beverage segment accounted for the largest share of the market in 2020, with beer being the most consumed alcoholic beverage worldwide. Thus, disruption in the supply chain of raw materials . Out of which, her per capita income was 50,844 US dollars and it's 10th highest in the world. - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. 1. It is written by Glenn Carroll, Greg Powell and shed light on critical areas in field of Strategy & Execution, Entrepreneurship, Strategy that the protagonist in the case study is facing. PEST is an acronym for Political Economic Social and Technological factors which are used to assess the market for a business. Published by HBR Publications. Developing strategies that can capitalize on Chocolate Hawkins strengths and help mitigate weaknesses and impact of threats of macro-environment.