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Each and every category of factors is of crucial importance to advanced strategic management, and the PESTLE analysis in itself is definitely a must for any business or company, regardless of its industry. It is true that the importance of each category of factors will always vary from business to business and from company to company, but nonetheless PESTLE remains a mandatory analysis technique that is usually a part of the larger and more comprehensive SWOT analysis.

PESTLE helps a company determine exactly how various types and categories of factors influence its ‘well-being’. As aforementioned, the same factors will influence different companies in different ways. For instance, an online business will be less concerned about environmental factors while a waste management company will have to pay extra attention to environmental factors.

To further understand what PESTLE is and how it can be used, it is essential that you know a thing or two about each individual category of factors. The below descriptions should help you gain a better understanding of each factor and of just how powerful and effective a PESTLE analysis can be for a business.

Political Factors
These factors represent the way and the extent to which a government influences the economy and a certain business. Political factors are represented by specific areas, such as labour law, tax policy, tariffs, trade restrictions and even environmental law.

When political decisions result in legislation which is not favourable to a particular company they may sometimes use astroturfing techniques in an attempt to put pressure on the government to change its mind.

An example of this occurred in 2012 in the UK when the Chancellor of the Exchequer, George Osborne, announced that VAT would be applicable on all ‘hot takeaway food’. Greggs bakery quickly jumped onto the press reaction and created a very clever campaign which put a huge amount of pressure on the government to reverse its...
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