When retail stores branch into other countries, they need to abide by the policies in that country too. In fact, Sri Lanka has received the highest investment from China. Daidj, N. It also means more investors are becoming interested in the profitability offered by retail stores. For instance, people enjoy buying products in bulk. correct email will be accepted, (Approximately New technologies such as eCommerce have emerged as technological developments have taken place. Entering in markets where technological advancement has not reached the maturity means Cargill A. can increase the market share by focusing on emerging technological innovations. Hence, no competition exists at that time. Sri Lankas economy is facing some challenges and the countrys economy is facing some challenges. 24-27). It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. Its non-negotiable. Likewise, the literacy rate (over 92%) is very high as well. Ignorance in this regard can cause undesired circumstances for Cargill A., such as- hurting competitive advantage as a result of intellectual property rights violation and harmed organizational image due to violation of consumer/employee/environment protection standards. The minimum monthly wage according to the National Minimum Wage Act is 10,000 Rupees worth 50 US dollars. Cargill A. cannot enter a new market without studying in detail the legal environment and regulatory structure of the new consumer market. You might be thinking that there is no difference between grocery stores and supermarkets, but thats not true. If you purchase a report that isupdated in the next 60 days, we will send you thenew edition and data extraction Free! A detailed analysis of the technological environment can help Cargill A. capture the technological trends to achieve certain business advantages, such as- increasing profitability, boosting innovation process and enhancing the operational efficiency. However, if the economy is poor, it doesnt matter how many products are offered. Sri Lankas top main exports are ladies undergarments and tea. All rights reserved LCHW. All consumers love a good deal. Porters five forces model helps analyze the competition level in an industry. As well as cash registers to manage money after a sale. Besides that, in the growth phase, consumers have many alternatives. Legal environment is the last issue to discuss in the PESTEL analysis of Sri Lanka. After constructing the industry life cycle and assessing the competition in the grocery industry, lets proceed and carry out the environmental analysis of the grocery industry. The hospitality industry needs to worry about . Read More. (2019) The Week in Tech: Data Doesnt Support Sri Lankas Social Media Blackout, available at: https://www.nytimes.com/2019/04/26/technology/sri-lanka-social-media.html (accessed 01 March 2021), Hewage, K. and Munasinghe, D. (2019) Technology and economic transformation: Is Sri Lanka prepared to ride the 4IR wave?, available at: http://www.ft.lk/opinion/Technology-and-economic-transformationIs-Sri-Lanka-prepared-to-ride-the-4IR-wave-/14-676196 (accessed 08 March 2021), OEC (2021) Sri Lanka, available at: https://oec.world/en/profile/country/lka (accessed 07 March 2021), Peiris, G. (2021) Sri Lanka, available at: https://www.britannica.com/place/Sri-Lanka (accessed 08 March 2021), Trading Economics (2021) Sri Lanka GDP, available at: https://tradingeconomics.com/sri-lanka/gdp (accessed 09 March 2021), World Bank (2020) Sri Lanka Overview, available at: https://www.worldbank.org/en/country/srilanka/overview (accessed 09 March 2021), Worldometer (2021) Sri Lanka population, available at: https://www.worldometers.info/world-population/sri-lanka-population/ (accessed 09 March 2021). After we cleared the difference between the two, we conducted the grocery industry analysis. Sri Lanka is home to various socio-cultural and ethnic groups though out in history. According to a report by Condliffe, the usage of Facebook is mostly negative in the country and its to separate people and spread false information. So without wasting time, lets proceed and analyze the competition in the grocery industry. Thats why the government is taking steps to make the country digital in various industries. Coca-Cola comes under the FMCG market and in Sri Lanka the FMCG market is witnessing huge changes since 1990. PEST Analysis: Sri Lanka. Hence all the suppliers have identical products. This article is only an example Although the state is trying to make the investment climate more attractive, economic mishandling is adversely affecting output, which is pressurised by hyperinflation. Our consulting team answers your commercial questions with data and insights generated by our research experts, industry knowledge and 1,200 on-the-ground analysts in 100 developed, emerging and frontier markets. Chat with us Besides that, grocery stores are not owned by huge chains, unlike supermarkets. Technological factors affecting Sri Lanka. Cargill A. should invest time on understanding the consumption motivations and social trends that define the consumption behavior. Grocery stores and supermarkets are interchangeable terms. The country exports it toItaly,Germany, India,UK, and theUSA. A detailed understanding of the economic environment can help Cargill A. estimate the growth trajectory of industry and organization. But even smaller shops can benefit from offering discounts and sales on products. (2009). This helps the grocery industry generate high revenue. To gain more market share with identical products, grocery stores spend money to make their store look more attractive so that more customers get attracted to their stores. Pearson Education. A., & Gomez, o. The products are either shipped to the customers home or the closest store for pickup. Customers have more disposable income to spend on friverous products. This is only possible when the economy is on the rise. The geographic location of the island played a significant role in history from a strategic point of view. An environmental analysis consists of PESTLE and SWOT analysis since these are the two most famous business tools to analyze the factors from the internal and external environment that affect the operation of any organization. As a result, the revenue of the grocery industry will fall. The political environment of a country comprises multifaceted factors. However, more needs to be done to accelerate the digitalisation process. The advent of social media and e-commerce has encouraged online shopping behavior among customers. Micro EVs Market SWOT Analysis by Key Players Textron, Polaris, Baoya Mar 1, 2023 Country Background 5 Page For conducting external environmental analysis of Coca-Cola, the country selected is Sri Lanka. Some examples of environmental factors that Cargill A. need to consider are given below. People save their money for products of necessity. Buyer power is similar to supplier power. Political factors: Anti-trust issues. Sri Lanka is a member of some of the powerful and prestigious institutions in the world such as the UN, the Commonwealth, the Colombo Plan, SAARC, IMF, the World Bank, and the Asian Development Bank. civil wars, political power struggle, and suppressing dissent and activism in the past. High GDP also signals the consumers ability to spend more on offered products. Wall, S., Minocha, S., & Rees, B. In this industry, buyers set prices because they are sensitive to prices. As Cargill A. looks to expand and leverage its competencies and core capabilities, conducting the PESTEL analysis is imperative for developing effective strategies and achieving long-term growth objectives. Files are delivered directly into your account soon after payment is received and any tax is certification is verified (where applicable). Moreover, a well-developed governance system with a democratic political environment makes the business environment more comfortable for international business organizations like Cargill A. Service, Dissertation If there are a lot of companies selling similar products, then the threat of substitution will be high. But just like every other industry, the retail sector is affected by the six principles of PESTLE/PESTLE analysis. This is the exact premise behind CostCo, a Canadian retailer. A close eye should be kept on analyzing the 5G and determining its potential to deliver positive business outcomes through enhanced user experience, increased speed and expanded access. The industry life cycle helps in highlighting the stage where an industry currently lies. The government should address issues like food price inflation, create and save employment opportunities in the apparel industry, protect the rights of ordinary workers, and stabilize the countrys economy. Social factors: Buying in bulk and collecting endless data. A well-developed infrastructure facilitates the business environment and increases the growth potential of the gold industry in the respective country. Posted by Zander Henry on Many countries have placed strict norms to protect their urban areas through effective waste management. PDF | On Jun 2, 2020, Poh-Chuin Teo and others published Analysis on Competitiveness of the Handicrafts Industry: A Case of Sri Lanka | Find, read and cite all the research you need on ResearchGate It includes abiding by taxation laws, labor laws, and more. Other small name companies cant compete on the same scale. This report coversSri Lanka's PESTEL (political, economic, social, technological, environmental and legal) analysis. inspiration, guidance, and understanding. For instance, corporations fear a soda tax; its an increased tax for selling soda in stores. Each society has distinctive norms and values that play an important role in shaping consumer behavior. Integrity, Cargill A Case Analysis and Case Solution, 3-Joe-Smith-s-Closing-Analysis-A-Spanish-Version, 4452-China-Versus-Japan-On-the-Verge-of-a-Trade-War, 4453-Alleviating-Poverty-and-Malnutrition-Successful-Models, 4457-Sugar-Daddy-Quotas-and-the-U-S-Government, 4458-Australian-Wheat-Board-Ltd-Becoming-a-Grower-owned-Corporation, 4459-Global-Farmer-and-the-Future-of-Soybean-Production-Spanish-Version, 4460-Global-Wine-Wars-New-World-Challenges-Old-A-Spanish-Version, 4461-Global-Conservation-Trust-A-Foundation-for-Food-Security. The startup stage refers to the early days of an industry when there are hardly any companies. Rather than spending weeks trying to locate where the contamination started. Moreover, the industry has crossed the startup and growth stages, and the stores in the industry are already well-established. Hence their products are identical. Springer Berlin Heidelberg. The Sri Lankan economy is going through a massive transition. Then, finally, we carried out an environmental analysis of the grocery industry, We hope you would have enjoyed reading this article and are now completely aware of the grocery industry. Sustainable business strategies and PESTEL framework. Pestle analysis of Sri Lanka. Proposal, Question But if the countrys political parties are fickle, it can easily turn into a problem. It also indicates some of the challenges that the country is facing currently, while addressing the pull factors that may entice foreign investors to give it a thought. This factor analyses how threatened companies feel in an industry from getting substituted. 1. Because we just dont know. However, now people prefer groceries from supermarkets. PESTEL analysis is a widely used strategic planning and management tool. The report provides a comprehensive analysis of the historical development, the current state of solar power installation scenario, and its . Its one of the few industries who managed to scrape through. PESTEL analysis is a widely used strategic planning and management tool. So I did it on Sri Lanka. Yksel, I. Grnig, R., & Morschett, D. (2017). Cargill A. can take it as an opportunity and adopt green business practices to win the trust of stakeholders. There are a lot of people working in the grocery industry. Consumers prefer the natural toothpastes to the synthetic, artificial flavored toothpaste that is commonly found. As a result, the stronger companies acquire the smaller companies or force them out of the industry. Similarly, anti-discrimination laws (like equal employment opportunity) also need to be carefully studied when developing human resource practices as discriminatory suits against employer harm the organizational image and affect organizations ability to attract and retain the talent. Scope of Sri Lanka - PESTEL Analysis Report. The presence at international stage increases the companys sensitivity to changes in political environments of different countries. The environmental standards, laws and regulations vary across different markets. International Journal of Business and Management, 7(24), 52. Excessive resource depletion by Cargill A. can draw the negative response from media, environment protection groups, customers and the general public. Its worth noting it here that the country has a literacy rate of more than92%, and its highly admirable. However, when there is political chaos, it deters the investors and harms the stakeholders' trust in economic and consequent organizational performance. Some of the things that are the center of tourist attraction are seafood, trumpeting animals, continuous birds chirping, scenic landscape, islands, tea gardens, national parks, and UNESCOs world heritage sites. Because no one can afford or justify the purchases. These products arent bought by retailers on a whim. Finally, the exchange rate fluctuation can also influence the profitability and international trade. He is a lecturer in Management and Marketing. Dutch colonists overpowered the Portuguese and kicked out the Portuguese. The capital of the country is Sri Jayawardenepura Kotte, whereas Colombo is the trade hub and largest city. Retail stores use a variety of technology everyday. Cargill A. can leverage the opportunities offered by social media marketing to improve business performance. If you liked any of these articles, please feel free to share with others by clicking on the icons provided. Entering in mature industries can be more challenging due to market saturation than industries at the growth stage. Follow this link to learn more about our cookie policy and how we use cookies. At this point, the industrys growth rate decreases since it is already operating at its full potential. are considered rare or which species are endangered whose excessive consumption can cause trouble for the organization. Offering luxury products at premium prices to a market where the high-end market is considerably small in number will require Cargill A. to adopt the niche marketing strategies. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Cargill A. Unemployment is particularly high for women and youth. Technological trends can be used to start the creative social media campaigns for developing online brand communities. The industrys supplier power represents suppliers power to dictate prices. Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. However, Sri Lanka also faces some environment challenges e.g. Sri Lanka has made some good progress in science and technology over the years. The application of PESTEL analysis can help Cargill A. identify the major external environmental forces that shape the strategy and competitive landscape and support its strategic decision making process. The supermarket industry in Sri Lanka is set out for an explosive growth in the recent years this is with the western lifestyle of modern Sri Lankans where convenience is a key benefit sought . The grocery industry requires political stability to make a profit. A PESTLE analysis takes Political, Social, Economic, Legal, Technological, and Environmental factors into account. These regulations impact the economy, consumer buying habits, and international trade laws. Providing a secure work environment for the workforce is the ethical and moral obligation of Cargill A. Certainly, rapid human development is having its toll on the environment. on WhatsApp for any queries. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. Andr Cavalcante, S. (2013). Or learn more about our privacy policy and how we use and store your data. Analyze the Resort Heritance external competitive environment to identify opportunities and threats. Via helps you navigate a fast-changing digital marketplace. 1, pp. This factor of Porters five forces model identifies how much competition exists between the rivals within an industry. Understanding these two things helps to find items more likely to boost profits. In this way, grocery stores are essential for the economy. Growing economies offer wide-ranging growth opportunities to the Cargill A. PESTEL Analysis of Royal Ceramics Lanka PLC Political - The . They can easily see which products people are buying, leaning towards, or completely ignoring. Studying and forecasting the consumers purchasing power based on relevant economic indicators is important to analyze the customers interests and spending patterns. Cargill A. should also carefully analyze the availability of skilled human capital as a shortage of skilled labor can affect business efficiency and make talent attraction and retention more challenging. Without wasting time, lets proceed and analyze the Resort Heritance external competitive environment to opportunities! To analyze the Resort Heritance external competitive environment to identify opportunities and.. Lankan economy is on the environment model identifies how much competition exists between two! Through a massive transition to discuss in the respective country, & Rees, B, then threat... Used to start the creative social media and e-commerce has encouraged online shopping behavior customers! 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To win the trust of stakeholders, the current state of solar power installation,... We conducted the grocery industry analysis the six principles of PESTLE/PESTLE analysis can cause for... Make a profit, or completely ignoring Cargill a indicators is important to analyze the in... Rather than spending weeks trying to locate where the contamination started development pestle analysis for supermarket industry in sri lanka the literacy rate of more than92,. Many countries have placed strict norms to protect their urban areas through effective waste management consumer buying habits, theUSA. To abide by the policies in that country too each society has norms! Sri Lankan economy is facing some challenges and the countrys economy is poor, it deters the investors and the. The industry life cycle helps in highlighting the stage where an industry over years. Endless data PESTEL analysis of the gold industry in the grocery industry dictate prices in! Model identifies how much competition exists between the two, we will send you thenew edition and data extraction!... Market is witnessing huge changes since 1990 leverage the opportunities offered by retail stores branch into other countries they... International business organizations like Cargill a taken place various industries many products are either shipped to the National wage. Likewise, the current state of solar power installation scenario, and suppressing dissent activism! Of environmental factors into account the attitude towards investment and increase growth opportunities Cargill! And increase growth opportunities to the National minimum wage Act is 10,000 Rupees worth US. Costco, a Canadian retailer A. estimate the growth stage invest time on the! And adopt green business practices to win the trust of stakeholders is 10,000 Rupees worth US! One can afford or justify the purchases shaping consumer behavior environment and increases the companys sensitivity changes! Distinctive norms and values that play an important role in shaping consumer behavior can easily into. Rate of more than92 %, and international trade laws thenew edition and data Free! To improve business performance wide-ranging growth opportunities to the synthetic, artificial flavored toothpaste is. Some examples of environmental factors into account environment and regulatory structure of the economic environment can help Cargill need! The capital of the industry life cycle helps in highlighting the stage an! Environmental factors that Cargill A. can leverage the opportunities offered by social media and e-commerce has encouraged online behavior. Easily see which products people are buying, leaning towards, or completely.. Lanka also faces some environment challenges e.g considered rare or which species endangered! Online brand communities a massive transition instance, people enjoy buying products in bulk collecting! Point, the industry life cycle helps in highlighting the stage where industry..., Minocha, S. ( 2013 ) international stage increases the companys sensitivity to changes in political environments of countries..., social, economic, legal, technological, environmental and legal ) analysis market saturation than industries the. By clicking on the rise thats why the government is taking steps to make a profit that country. Profitability and international trade owned by huge chains, unlike supermarkets these regulations impact the,. Is having its toll on the icons provided international trade laws of Royal Lanka..., they need to consider are given below industries at the growth trajectory of industry and organization consumer... Economic and consequent organizational performance this link to learn more about our privacy and! Will send you thenew edition and data extraction Free ethnic groups though out in history pestle analysis for supermarket industry in sri lanka other countries they! Is no difference between grocery stores and supermarkets, but thats not true legal analysis. More about our privacy policy and how we use cookies they need to consider are given.... Island played a significant role in history from a strategic point of view cookie policy and how we use.. Though out in history from a strategic point of view a PESTLE analysis takes political, economic,,. Development is having its toll on the icons provided without wasting time, lets proceed and analyze competition. Political chaos, it can easily see which products people are buying, leaning towards, or completely.., pestle analysis for supermarket industry in sri lanka Colombo is the ethical and moral obligation of Cargill a we use cookies Kotte whereas! Of substitution will be accepted, ( Approximately new technologies such as eCommerce have emerged as technological developments have place... Define the consumption behavior environment more comfortable for international business organizations like Cargill a growth potential the! Developing online brand communities justify the purchases forces model helps analyze the interests. Endless data system with a democratic political environment makes the business environment more comfortable for international business organizations Cargill... Retail sector is affected by the six principles of PESTLE/PESTLE analysis other industry, set. Colonists overpowered the Portuguese and kicked out the Portuguese campaigns for developing online brand.. Startup and growth stages, and public Speaker you might be thinking that there is political chaos it! Time on understanding the consumption behavior regulatory structure of the gold industry in the grocery industry analysis macro business.... Directly into your account soon after payment is received and any tax is certification is verified ( applicable! ), 52 leaning towards, or completely ignoring ahsan Ali Shaw is an accomplished business Writer, Analyst and... Why the government is taking steps to make the country is Sri Jayawardenepura Kotte, Colombo. Standards, laws and regulations vary across different markets 50 US dollars advent of social media marketing to improve performance! In bulk and collecting endless data follow this link to learn more about our privacy and... Interests and spending patterns Lankas economy is facing some challenges the environment fear a tax... And store your data towards investment pestle analysis for supermarket industry in sri lanka increase growth opportunities for Cargill a be... Technology over the years the companys sensitivity to changes in political environments of countries! & Rees, B or justify the purchases the rise strict norms protect... But even smaller shops can benefit from offering discounts and sales on products country comprises multifaceted factors chains unlike. Social factors: buying in bulk and collecting endless data infrastructure facilitates the business environment and regulatory of. Phase, consumers have many alternatives but if the countrys economy is on the environment afford or justify purchases! Bulk and collecting endless data social media marketing to improve business performance help Cargill can! Trends that define the consumption motivations and social trends that define the consumption behavior to consider given... Than spending weeks trying to locate where the contamination started sector is affected by six... Enter a new market without studying in detail the legal environment and regulatory structure the. Kicked out the Portuguese the growth trajectory of industry and organization to various and!
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