Its fast and easy to use. Grnig, R., & Morschett, D. (2017). Lets discuss what external factors impact the grocery industry. The rapid technological advancement and technological diffusion across the globe have increased the importance of understanding technological factors during the strategic decision making process. Thank you for your email subscription. IGI Global. The online shopping trend is growing among people and it has given rise to many local e-commerce stores. Where should we focus our expansion strategy? However, when there is political chaos, it deters the investors and harms the stakeholders' trust in economic and consequent organizational performance. The political environment of a country comprises multifaceted factors. The extreme poverty level, environmental issues, and inflation are some of the main issues. As more people join, the competition in the industry increases. The geographic location of the island played a significant role in history from a strategic point of view. To conclude, the PESTEL model is an important business tool that involves a detailed analysis of macro-environmental factors that shape the business environment. Once a food, like lettuce, has E.coli, every store needs to toss out their lettuce. We are here to help. This is only possible when the economy is on the rise. Grocery stores are afraid to get substituted since a huge number of homogeneous stores exist that offer the same products. Portuguese accidentally came to the Island in the16thcentury and controlled the natural resources for some. In this stage, the share of an industry begins to fall as companies start to leave the industry because the demand for the industry falls. Now that we are done discussing the life cycle of the grocery industry lets proceed to the second step of the Industry analysis to see the level of competition that exists in the industry with the help of Porters five forces model. Because we just dont know. Although, Limited-service restaurants in Indonesia saw impressively strong growth in terms of overall transactions in 2022 a turnaround from 2021s continued decline.. Other relevant articles for you are: PESTEL analysis of the Fashion Retail Industry in the UK. Whereas, operating in rigid labor markets may cause labor wage and other issues raised by powerful labor unions. Today, well discuss the pestle analysis of Sri Lanka. 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. Lastly, Cargill A. should study the consumers leisure interests and should focus more on enhancing the customer experience if customers prefer experiential products over traditional product offerings. Major political instability and distressed government finances have blighted Sri Lanka, which is 'mostly unfree' for economic freedom. It pressurizes the Cargill A. to develop new products quickly, increase product range diversity, integrate flexibility into the value chain and develop healthy business relationships with value chain partners. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. Cargill A. should develop local teams and develop local partnerships for understanding the societal attitudes and norms to tailor marketing strategies according to unique cultural context. PESTEL analysis is a widely used strategic planning and management tool. The grocery industry hit its maturity stage in the early 1990s. Or when a certain industry is hit harder than others. 5.4 Ansoff Matrix Analysis 5.5 PESTLE Analysis 6 Global Healthcare Staffing Market, By Service Type 6.1 Introduction . (vitag.Init = window.vitag.Init || []).push(function () { viAPItag.display("vi_23289101301") }), Technological factors impacting Sri Lanka, Environmental factors impacting Sri Lanka. Then finally, you have to conduct an environmental analysis of the industry. Its one of the few industries who managed to scrape through. Technological innovations like this can bring major transformations in the industry and reset the success rules for market players. M Market Research Reports and the M Market Research Reports Logo are registered trademarks of Market Research Reports, Inc. Disclaimer: Market Research Reports, Inc. has no affiliation to, and is not associated with any other website(s) or organization(s). Sri Lanka has realized the significance of science and technology. Heres the pestle analysis of Sri Lanka as follows; Sri Lanka follows the semi-presidential system of government and administration. Entering in mature industries can be more challenging due to market saturation than industries at the growth stage. The last factor of Porters Five Forces Model analyses the threats already existing companies face from new entrants. New technologies such as eCommerce have emerged as technological developments have taken place. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Sri Lankas top main exports are ladies undergarments and tea. The corruption can influence various business operations, ranging from licensing, contracting, fraudulent deals to frequent lawsuits. Within PESTEL analysis, political factors exert a strong influence on the long-term sustainability and profitability of Cargill A. Dissertation For example, a supermarket will have a pharmacy, a toy area, a clothing area, etc. Every industry has a different buyer power. take time-critical decisions. Sri Lanka has been exposed to different cultures throughout the history as evidenced from the fact that it was called Taprobane by ancient Greek geographers, Serendib by Arabs, and Ceylon by European mapmakers (Peiris, 2021). At Market Research Reports, Inc. we aim to make it easier for decision makers to find relevant information and locate right market research reports which can save their time and assist in what they do best, i.e. After that, the growth stage arrives. Developing international strategies. This is costly for the companies. Currently, the economy worldwide is in a great spot for retail industries to expand. Finally, the exchange rate fluctuation can also influence the profitability and international trade. IFS marks 25th anniversary of the inception of its operations in Sri Lanka as it sees continued success in technology excellence In some countries, recycling has almost become a business norm. This affects the retail industry, particularly big names like Wal-Mart and Amazon, who provide products online. Political stability creates economic growth, due to which the disposable income of consumers increases. These conditions are often standard. Pestle analysis of Sri Lanka. Besides that, in the growth phase, consumers have many alternatives. It also maintains good foreign relations with powerful neighbours such as China and Pakistan. The Latest Released Micro EVs market study has evaluated the future growth potential of Global Micro EVs market and provides information and useful stats on market structure and size. Our model papers and solutions are purely meant for 11.12 Sri Lanka 11.13 Thailand All Rights Reserved, Economic factors: Nearly $30 trillion dollars in a couple more years, Social factors: Buying in bulk and collecting endless data, Technological factors: A digital catalogue for easy browsing, Environmental factors: Contamination and blockchain technology, A stronger economy allows consumers to buy products they want, more disposable income to spend on friverous products, main social factors affecting the retail industry, They use market research to identify buying trends, about environmental issues inside of the stores, 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, Strategies for School and College Security, Steps to Secure your Business After a Cybersecurity Breach. Moreover, adopting efficient waste management practices in organizational units that are located in or near urban areas is highly crucial for Cargill A. The economy is not big as the country is small; however, it is expected to grow and reach around $97 billion by the end of 2022. A PESTLE analysis takes Political, Social, Economic, Legal, Technological, and Environmental factors into account. Ceramic tiles industry in Sri Lanka has over 34 years long history in manufacturing and distributing tiles all over the country as well as exporting them to many foreign countries in the world. This report series allows you to understand the macro-economic environment as a basis for strategic planning. Understanding the demographic trends, power structures, consumers spending patterns and shared beliefs can help Cargill A. design effective marketing messages and fulfil corporate objectives through informed PESTEL analysis. Access and download reports and data purchased through Euromonitor.com. Detailed environmental analysis is imperative before deciding to enter a new market or start a new product line. Chat with us If not, select "Manage Preferences" to learn more about managing your cookie preferences. The country has multiple democratic parties. There are almost 40,000 stores in the US that sell groceries. It has very close cultural interactions with India as well. ~ 0.0 Page). The grocery industry currently seems to be in a decline stage since now the demand for the grocery industry has fallen as people have different alternatives such as e-stores and supermarkets. The organization may also study the industry specific taxation policies to understand the host government's priorities and interest in developing industries. P. - John Keells are known as the influential people. . Springer Berlin Heidelberg. This can only happen if the suppliers are low in numbers or they are supplying something very unique or scarce. When the organizations figure and execute the techniques, the political field has an immense effect on organizations' guidelines and buyers and different organizations' spending force. Retailers who offer products online can collect data provided by their customers. Studying and forecasting the consumers purchasing power based on relevant economic indicators is important to analyze the customers interests and spending patterns. Then, they shape their offerings based on this data. This repels customers. If Cargill A. decides to enter in markets with the corrupt economic, political system, it will threaten the organization's sustainable development by destabilizing the society, harming justice system and endangering the rule of law. In this way, grocery stores are essential for the economy. These memberships attest to its importance in the regional socio-political affairs and beyond. 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 grocery stores are smaller in size and offer limited products, of which almost 90% are food related. Majority of the people live in rural areas and rely significantly on agriculture for their livelihood. Service, Dissertation Culture is considered an important variable by international marketing managers. Thats when shops began to establish. A largely rural-based economy is shifting towards a more urbanized one with focus on manufacturing and services (World Bank, 2021). However, there are some challenges facing the Sri Lankan economy. Antitrust issues and data breaches are causing the government to look into how data is stored, used, and shared. Other than that, hes a fun loving person. In this way, grocery stores are essential for the economy. 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. Many countries have placed strict norms to protect their urban areas through effective waste management. 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. You might be thinking that there is no difference between grocery stores and supermarkets, but thats not true. Follow this link to learn more about our cookie policy and how we use cookies. Coca-Cola comes under the FMCG market and in Sri Lanka the FMCG market is witnessing huge changes since 1990. The advent of social media and e-commerce has encouraged online shopping behavior among customers. Proposal, Assignment Writing Major political instability and distressed government finances have blighted Sri Lanka, which is mostly unfree for economic freedom. Amazon and Walmart are going head-to-head. Tea and womens undergarments are the two top exports of Sri Lanka that mostly go to countries such as the USA, the UK, India, Germany, and Italy. LinkedIn, Messenger, Instagram, and Facebook are some of the most popular social media platforms. Therefore, they wont let newcomers come and snatch their market share. There are a lot of people working in the grocery industry. According to an estimate, the annual nominal GDP of Sri Lanka in 2020 was81.120billion dollars, and its66thworlds highest. Academic writing has no room for errors and mistakes. More retail shops are offering food products. Grocery stores mainly keep packaged food items. The grocery industry experienced the startup stage between the 11th and 14th centuries. The presence at international stage increases the companys sensitivity to changes in political environments of different countries. 3 of 2016 ensures that employees are paid a national minimum monthly wage of 10,000 Sri Lankan rupee which is equivalent to around 50 US dollars. In the early days, people preferred buying groceries from grocery stores. Today, new products are developed quickly, and supply chain partners have also gained more power. Intellectual property regulations are designed to protect the companies' patents and valuable ideas. Analyze the Resort Heritance external competitive environment to identify opportunities and threats. The industry analysis consisted of three stages. As a result, the stronger companies acquire the smaller companies or force them out of the industry. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Cargill A. 2023 Euromonitor is privately owned & trademarked. IEEE. PESTLE Analysis Political Factors In Sri Lanka it is a socialist republic state. Out of these 40,000 stores, more than 26,000 are simple grocery stores. The business and marketing strategies are also influenced by migration. Growing tensions and instabilities in the global political environment can affect the Gold industry growth and limit the growth opportunities available to Cargill A. Synopsis. The current account balance for Sri Lanka was estimated to be negative at USD 1.932 billions for the year 2016 and is expected to decrease at a CAGR of 2.35% and reach USD 2.364 by 2022. Learn how to, Our Mayo Clinic SWOT Analysis examines the Strengths, Weaknesses, Opportunities and Threats of one of, Technology is now taking over, and almost all fields are turning most tasks into digital., Schools and colleges should always take proactive steps to guarantee the safety of its students, Cyberattacks can harm your business on many levels. correct email will be accepted, (Approximately Developing a multi-criteria decision making model for PESTEL analysis. Following economic factors need to be considered by Cargill A. to make informed decisions: The economic development of a country directly influences organizational performance. Copyright 2017 2025. Out of which, the per capita income of the country was3697dollars, and its113thworlds highest. Legal is the sixth factor of PESTEL analysis. You dont have to walk down the street to your favorite shop anymore. A well-developed infrastructure facilitates the business environment and increases the growth potential of the gold industry in the respective country. Likewise, the computer literacy rate needs improvement as it was only 27.5% in 2019 (Hewage and Munasinghe, 2019). Besides that, grocery stores are not owned by huge chains, unlike supermarkets. According to the World Bank (cited in Trading Economics, 2021), the GDP of Sri Lanka was worth around $84 billion in 2019. In this case, suppliers have zero power because if they try to dictate prices, the grocery stores will immediately change the supplier. Strength. Weve seen shifts in how eCommerce retail leaders operate over the last few years. The demand and supply of labor determine the wage rates and supply of skilled workforce. Cargill A. must consider these factors to ensure compliance with consumer protection laws. Cargill A. should invest time on understanding the consumption motivations and social trends that define the consumption behavior. Legal environment is the last issue to discuss in the PESTEL analysis of Sri Lanka. Demography. Technological trends can be used to start the creative social media campaigns for developing online brand communities. For instance, extreme weather conditions can increase the cost of operations and compel the Cargill A. to make the value chain more flexible. Moreover, a well-developed governance system with a democratic political environment makes the business environment more comfortable for international business organizations like Cargill A. The consumers spending patterns are influenced by their purchasing power of money. Companies set targeted ads to customers most likely to visit their stores and buy from them. The minimum monthly wage according to the National Minimum Wage Act is 10,000 Rupees worth 50 US dollars. 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A pestle analysis 6 Global Healthcare Staffing market, by Service Type 6.1.... Force them out of which, the economy is shifting towards a more urbanized one with focus on manufacturing services! 90 % are food related and offer limited products, of which almost 90 % are food related Lanka 2020... Improvement as it was only 27.5 % in 2019 ( Hewage and Munasinghe, 2019.! The same products as China and Pakistan and how we use cookies stores in the US that sell groceries discuss...