Positive and Negative Impact of External Factors on Asda: A PESTEL Analysis

International Business

Table of Contents
Introduction......................................................................................................................................3
Main body........................................................................................................................................3
PESTEL Analysis along with its positive and negative impact. ................................................3
Key challenges faced by the organisations.................................................................................6
How business organisations are responding to such challenges.................................................6
Recommendations ...........................................................................................................................7
Conclusion .....................................................................................................................................8
References........................................................................................................................................9

Introduction
Business refers to an activity or set of activity which helps in making money and living
for an individual or a group of individual with the help of producing and selling goods and
services. Business owner is fully responsible for all the debts and liabilities and if the business is
unable to pay the liability then the creditor can acquire the personal assets of the business owner
in order to recover the amount (Cortez and Johnston., 2018). In context to Asda, it is a British
Supermarket chain dealing in products and services such as Groceries, general merchandise and
financial services. The company was founded in the year 1949 by Peter and Fred Asquith and Sir
Noel Stockdale. The company is headquartered in Leeds, England, UK. Walmart acquired a big
share in Asda for £6.7 billion in the year 1919. in 2021, EG Group acquired Asda and Walmart
retains an equity share in Asda. In this report, positive and negative impact of external factors on
the company is given. The next section of the report covers the challenges faced by the company
and how it responded to those challenges.
Main body
PESTEL Analysis along with its positive and negative impact.
It refers to the analysis of external factors of the industry which can affect the
management and the workings of the company. It is generally done for the market in which the
company is going to enter but it can also be done for market in which company already exists. It
helps the company in analysing these factors beforehand so that the company can make strategies
in order to avoid any future contingency (Li., 2020). In case of Asda, the company has large
variety of goods and services to offer to their customers such as Asda mobile, Asda money,
medicines, George Clothing, etc. All the products have their separate industry and external
factors which can affect the workings of the industry. The external factors are given below:
Political factors:
It refers to the degree up to which the government can intervene in the workings of the
industry or into free market. It includes tax policies, trade restrictions, tariffs and Bureaucracy.
In case of Asda, the company has a strong presence in international market which increases the
risk for the company. Fiscal policies can be a major challenge for the company as in order to
expand the business of the company it is important for Asda to have a close check on industry
specific taxation policies.