PESTLE Analysis

A PESTLE analysis is a framework or tool used by marketers to analyse and monitor the
macro-environmental (external marketing environment) factors that have an impact on an
organisation.
The PESTLE factors combined with external Mirco-environmental factors can be classified
as opportunities and threats in a SWOT analysis.
There are six external factors that influence life of organizations: Political, Economic, Social,
Technological, Environmental and Legal.
Political Factors
Political factors include government regulations and legal issues and define both
formal and informal rules under which the firm must operate. Some examples include:
Tax policy
Employment laws
Environmental regulations
Trade restrictions and tariffs
Political stability
Economic Factors
Economic factors affect the purchasing power of potential customers and the firms
cost of capital. The following are examples of factors in the Marco economy:
Economic growth
Interest rates
Exchange rates
Inflation rate
Social Factors
Social factors include the demographic and cultural aspects of the external marcoenvironment. These factors affect customer needs and the size of potential markets.
Some social factors include:
Health consciousness
Population growth rate
Age distribution
Career attitudes
Emphasis on safety
Technological Factors

 Technological factors can lower barriers to entry, reduce minimum efficient

production levels and influence outsourcing decisions. Some technological factors
include:
R & D activity
Automation
Technology incentives
Rate of technological change
Environmental Factors
Environmental factors include infrastructure, cyclical weather, disposal of materials,
energy availability and cost and the ecological consequences of production processes.
Some example include:
Natural disasters
Global warming
Maturity of a countrys infrastructure
Financial penalties
Legal Factors
Legal factor is clear that companies need to know what is and what is not legal in
order to trade successfully. Some example include:
Health and safety
Equal opportunities
Advertising standards
Consumers rights and laws
Product labelling and product safety.

Moreover, using the PESTLE analysis is to ensure for identified the important implications
for a company and that nothing key has been overlooked.

The below PESTLE analysis focuses on The Postal and Courier Industry in Malaysia.
Political

Greater investment in certification

Economic
Social

and security solutions.

Increasing Cost.
Higher Consumption of postal and
courier services as a result of growing
wealth.

Technological
Environmental
Legal

Automated Machine for fast speedy

processing.
Carbon footprint
Social Responsibility Score
Postal Service Act 2012

Political Factors
The Malaysian political system can be rated as being very efficient and it is apparent that the
presence of political stability contributes to the increase in business stability as well. What
can be stated here is that it is this sort of political stability which is generally required to
make businesses like the postal and courier industry to prosper. This industry is likely to
benefit a great deal and this is because they can carry out their business activities and they do
not have to have much worry in relation to issues to do with political instability or other
business disruptions which can have a bad impact on their business performance.
Economic Factors
The economy of Malaysia is very stable and it is noted here that the economic policies
implemented by the government have brought success and prosperity to Malaysia. With the
presence of good economic conditions, it is important in the postal and courier industry
because of the high overhead and fixed cost of its network of hubs and stations for sorting,
pick-up and delivery, information and communications technology systems to provide
tracking, fleet of vehicles for transportation, and a large team of workers to undertake pick-up
and delivery. As such, the ability to generate sufficient volume of work to defray fixed costs
across a large number of items is important to reduce the overall unit cost is important for the
business to stay competitive and obtain higher profit margins.
Social Factors
The increasing population will translate into more delivery points particularly in residential
buildings. More investment will be required to innovatively expand the Post Office networks
that meet the needs of the consumers.
Technological Factors
The postal and courier industry is increasingly dependent on technology to provide tracking
of consignments, sorting of consignments and customer management system. The prudent

use of technology, especially in information and communications technology provides a

competitive edge to operators as they are in a better position to meet customers needs as well
as to constantly improve pick-up and delivery times.
Environmental Factors
The postal and courier industry in Malaysia need to understand and institute practical
measures to reduce carbon footprint of their respective organisations. Green technologies and
products such as electric powered, natural gas and hybrid vehicle, smart buildings and green
products recycling mail are becoming increasingly important in the future of postal and
courier industry.
Legal Factors
Courier License is under the Postal Services Act 2012, it is mandatory for Courier Express
and Parcel services companies to obtain a courier license issued by the Malaysian
Communications and Multimedia Commission (MCMC).