Pestel Analysis of Barclays Bank

The assignment provides a comprehensive Pestel analysis of Barclays Bank, identifying its key strengths and weaknesses in various business environment elements. The report covers the impact of external factors such as politics, society, technology, economics, legislation, and environment on the bank's operations. It also discusses the ability, weakness, opportunity, and threat (SWOT) analysis of Barclays Group, providing a detailed overview of the company's situation.

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Different types of enterprises and their purposes.............................................................1
P 2. Scope and size of range of various types of firm............................................................3
TASK 2............................................................................................................................................5
P 3. Relation between several organisational functionalities and their linkage with its
objectives................................................................................................................................5
P 4. Negative and Positive influences of macro environment on commercial operations.....7
TASK 4............................................................................................................................................8
P 5. Internal and external analysis of BARCLAYS for identifying its strength and weakness. .8
P 6. Interrelation of strengths and weaknesses with exterior macro elements.......................9
CONCLUSION..............................................................................................................................10
REFERENCES .............................................................................................................................12

INTRODUCTION
Business environment is a study of external and internal factors for understanding the
changes that is incurred at marketplace. Their main motive is to design organizational policies as
per the fluctuation in several elements that have a major impact on company success (Chow and
et. al., 2011). It can be said that development and success of a business is majorly relays on the
selection of business environment in which they supposed to operate. This involves internal and
external elements that are not the controllable to every company and comes as a resister and used
to prevent their functionalities. Some of the factors are user, employees, suppliers, governments,
technology, social group and so on. All these components are imposed on more of process of
decision making in the firm in both direct as well as indirect manner. The current report is based
on BARCLAYS for understanding the changes which is encountered by banking sector while
managing their business operations. In this report project, different kinds of firms along with
their operations are going to be detailed. Further, discussion will be imposed on their various
contexts such as scope, size and legal structure. More over to it for visualize the effects of macro
as well as micro environment, swot and pestle evaluation is also framed in this project.
TASK 1
P1. Different types of enterprises and their purposes
On the grounds of purpose and size, company are fall down in to major three divisions
which are known as public, private and voluntary. All of these are differ from each other that can
be understand through detailed point.
Public sector: All those companies that are operated as well as controlled by the
government authorities are comes under this division. Basically, these kinds of firms are
designing and manufacturing the services for their local or domestic persons at very less or
liberal rate. As their main objective is to facilitate every section of the society with qualitative
goods as well as provide basic needs for making their life more easy. However, in United
Kingdom there are various kinds of public associations are identified at marketplace
(Commander and Svejnar, 2011).
BARCLAYS is a public sector bank which engaged in providing services related to
banking operations. Along with that, they provide different kinds of financial services to the
citizens of UK. Barclays's is working revenue is recorded as nearly £3.230 billion and frame
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profit of approx. £2.828 billion in the comparison of year of 2016. The bank's headquarter is
located in London SS, United Kingdom and established in around 17th of NOVEMBER 1690 in
the city of London.
Purpose: First or foremost motive of Barclays bank is to serve common people by
offering best financial opportunities. It is also understood that they are not very interested in
having a large sum of profit like others or private firms.
Legal structure: The management of public division is also segmented in the context of
relevant areas such as central governance, local bodies and state government. That are detailed as
follows :
 “Central government” is a political body which is liable for governing entire nation and
managing every sector of corporate world. Basically, this advisory body is paying for
public goods and merit goods via taxation such as; income tax.
 "State government" is a separate division sector which is ruled as per state that is used to
practise different governmental functions that comes under the level of central
government and are reasoned as the unit that exist at the local level of government
(Drucker 2017).
 "Local government" is consist of different types of public body governance that are
having various obligation to cover only a general portion of the economic location,
which are separated from local bodies of the social security money.
Private sector: Another name of these association are profitable because private sectors
operates for the profit. Basically, in these kind of firms are not operated and owned by the
government. Private division are entirely owned by a single person who is liable for all the profit
and losses. Basically, private sector is classified into various sections such as; sole trader,
partnership, limited company and so on. All these associations are distinct in nature, size, scope
and motives
Burger king would be a best example in the context of private sector. It is an American
global chain of hamburger fast food restaurants by having its headquartered located in Miami,
Florida. Mainly, firm was established in around 1953 as InstaBurger. Form the survey, it is
searched that nearly 34,248 employees are working in entire firm, owned store and office. On the
other hand, it has been assessed that around 25000 workers are existing in their dealership in the
year of 2017. They are having around US$4.05 billion in the aforesaid time frame.
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Purpose : The main and prominent purpose of this company is to offer different types of
food stuffs like Pasta, Pizza, Submarine sandwiches, Chicken wings and Dessert, etc. to their
prospective consumers at inexpensive prices as compare with its competitors. They desire to
enlarge their enterprise in all over the universe and wanted to generate maximum sum of
earnings by performing similar same action.
Legal structure: The legal model of private sector firms is sorted into diverse sections,
such as partnerships, limited companies, sole trader and franchises (Gecevska and et. al., 2010).
However, an appropriate legal procedure which is followed by various types of private
enterprises are discussed below:-
Sole trader- According to this element single person is going to established a business
without acquiring support from any other members. It means, all the profits and liabilities are
belong from the single person only whomsoever have invested capital in the business.
 Setting up- Register as self employed company.
 Liability- if an association is getting failed in attaining their set goals then owner is liable
for all the debts related with organization.
 Capital- owner's fund is invested.
 Profits- belongs to the entrepreneur only.
 Continuity- business might get collapsed in case of owner death or retirement.
 Taxation- status is self-employed.
Partnership- It means if two members such as; friends, brothers, cousins, family
members and so on are coming closer for establishing a business by following necessary terms
and conditions related with partnership act 1890 is known as partnership.
 Setting up- Partners requisite to registered as a self-employed. Along with this, need to
acquire suggestion of legal professionalism and form a “deed of partnership”.
 Management- Both the partners are sharing roles and responsibilities amongst them.
 Liability and profits- shared between partners.
 Taxes- same as sole trader.
 Continuity- if any single person of partnership is becoming bankrupt, dies or resigns
then company might get dissolved.
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Limited company- As compared with sole trader and partnership limited organization
will not begin straight away because they need to acquire licence for selling any specific product.
Moreover, business name must include limited at the end or Ltd.
 Setting up- Needs to registered with registrar of companies act at companies house.
 Liability- Personal assets of any members or shareholders are protected in case of
business failed. It means things which is going to lose is the resources which are invested
into business. Thus, limited liability is present in this business.
 Finance- funds is raised by the sale of various shares.
 Profits- Requisite to pay dividends to the shareholders.
Voluntary sector: These type of firms are known as the charitable one and non-profit
organisation as this division is different from public and private sectors because distinct
objectives. Basically, group of persons involved in this organization are named as volunteers and
they took part in offering social services to the locals or citizens of United Kingdom. They work
to reduce the problem of common persons and facilitates them with basic services such as; food,
water, clothes, care, shelter and much more that is required by an individual. British heart
foundation would be the signify example in the volunteer division.
Purpose: The prominent motto of the voluntary sector is to match economic as well as
social necessitate of integral gathering of a state but especially to weak sector.
Legal structure: Board of directors are recognised as committee member and trustees of
such sort of associations that are having the cognition of making every important decisions and
frame up the structure of working actions. Volunteers are those force who used to adapt as well
as follow the route shown by such committee members.
P 2. Scope and size of various types of an organization
Every firm is having their own scope as well as size and also they have tehri own set of
motives . The scope and size of various types of companies is detailed such as:
Private segment : As detailed above kind of firms are privately runs by single entity or
more them it. Their major and core motive is to enhance the turnover in effective manner
through investing lower amount of money. The size and scope of various sort of private firms
are explains below:
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 Sole traders : Such types of business are runs by only single person who is having the
responsibility of take care of their all risks that are related with business operations
(Iskanius and et. al., 2010).
Scope : the prominent scope of such sort of entrepreneurs is to gain maximum amount of
turnover form their finance through flourishing their roots.
Size : It is very small in regards of size and have of minimum number of stores or shops.
 Partnership : It is a that kind of business which are operates by two or more individual
with mutual sharing of loads of working, all profit along with losses in certain condition
hence this is called partnership.
Scope : partners and members are believing in framing more benefits and dividing the
same in all of the persons.
Size : this types of firms comes in medium size as it is controlled by more then single
person.
Stakeholders linked with the company: these stakeholder is related with the private firms that
are detailed below.
 Employees : they are having the responsibility to work efficiently for completing their
regular prescribe work. Completion of the task will required an effective team and hence
employees needs to have sound and strong inter personal skills and abilities. Workers
needs to be aware about the norms and regulations of their firm (Klapper and
Delgado,2011).
 Consumers: They provide help to firms in order to undertakes their products and
services to be framed on the grounds of their request.
 Owners: they provide those valuable assets which are required for the firm in order to
run it in effective and efficient manner.
Public sector's corporation size and scope : As these all companies are regulated by the legal
authorities hence size of these company is quit larger then others. For example, Barclays is a
British bank which is international bank. They are associating around 119,300 employees in the
years of 2018. they are enacting in more then forty countries.
Stakeholders of the public organisations are:
 Government – It is used for regulating and monitoring the enterprise in related with the
activities in respect to defend buyers. Governance department is ensuring the goods' s
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regulation and all those rules as well that are appropriate and suitable to assure the safety
of buyer's prominent rights.
 Society – The social team or group is generally keep enterprise operation in the right
track by framing them conscious for their effects on person's living in the society. They
have used to written letters to particular business and the members of media and trying to
show views with the help of them (Osterwalder and Pigneur 2010).
Voluntary sector's scope and size : It is also known as charitable association that are a
medium sized firm too. But it is not mandatory, it may be tiny or also might be larger in some
particular situations. For instance, British heart foundation is a famous NGO that has around 200
branches or groups over the distinct regions.
Stakeholders of these kind of firms :
 Voluntary subordinates issues in board of members helps them in keep their project
operating.
 Donors, helps suppliers such as state or national agencies, organisation ect. That are
providing higher sum of funds.
TASK 2
P 3. Relation between several organisational functionalities and their linkage with its objectives
BARCLAYS is a retail as well as commercial back which is established in United
Kingdom. They are operating their business at wide level and providing various kinds of
products and services. Hierarchical framework is following by them so that all employees are
familiar with their roles, duties, positions, obligations and so on in a proper way (Storey and
Greene,2010). It has been determined that top level administration is having many
responsibilities comparison to low level. Henceforth, several types of objectives related to bank
is described as below:
 Manager need to enhance business activities because this will help them to provide them
success and enhancement.
 They have to render qualitative goods and services to clients as it provides them higher
satisfaction.
 If revenues of firm get increased then this will aid to render higher returns to
shareholders.
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 They are providing distinctive kinds of financial tool to customers and this helps them to
gain attention of numerous individuals towards them.
 To protect environment, it is fundamental for enterprise to diminish unwanted wastage.
There are many kinds of organisational functions which are accomplishing by company. It is
required for manager to know about needs and wants of people as this will help them to cater
them maximum level of fulfilment (Chesbrough 2010).
Therefore, functions of BARCLAYS is discussed as beneath:
Sales and marketing: Each type of organisation has to conduct research so that by
knowing needs and wants of people they will accomplish it effectually. For above stated purpose,
they will formulate some strategies or policies and this will be associated to promotion, prices
and so on. They have to modify their goods and services timely because it aids them to improve
effectiveness of it. As a result, sales and production will get enhanced. It has been examined that,
this division is connected to finance unit because if company is having sufficient fund then this
will aid them to accomplish marketing activities effectively. Thus, they will easily improve their
profits as well as sales which assist them in improvisation of market share.
Human resource: It is essential for firm to manage their staff members in an appropriate
manner. Superior will provide training to them as it will help to increase their working execution.
To maintain their working quality, it is must for manager to provide better surrounding to
employees. This will aid them to complete their work within provided period of time. Task has to
given to workers according to their skills and capabilities, it works as a motivation for them.
Thus, this department is linked with finance unit because if firm is having sufficient amount then
they will hire best candidate for association with assistance of any agency.
Research and development: This type of division is needed for each type of affiliation
because they aid to find out requirements as well as demands of people which has to be fulfil by
firm. It will cater success and in addition development to firm (Chavis and Love,2011). This help
enterprise to survive at marketplace for longer period of time. Along with, it enables them to
compete their rivals at competitive place. It has been analysed that, for R & D BARCLAYS
requires proper finance. If they have fund then they will conduct research more effectively which
will improve profits of company.
Finance: Manager has to maintain proper books of accounts because it helps them to
know about their financial status effectually. To raise finance for business, they will issue some
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share in public. As there main aim is to provide fund to other department so that it is must for
them to formulate a budget which assist them into examine that need of finance at each unit. It is
must for each division to follow budget because it helps them to reduce unwanted cost from
business procedure. As a result, entire work will get complete within sufficient resources
effectively. Thus, by reducing cost of activities, profits of firm will improved.
P4: Positive and negative impacts the macro environment upon business operations
External surrounding will provide impact to activities of company in both way, i.e. direct
or indirect way. This kind of components are not in control of firm. Along with, it is much
difficult to examine them. For this, manager of company will develop some types of strategies as
well as policies. Therefore, to find out these elements enterprise needs to conduct PESTLE
investigation. This will be stated as below:
Political factors: Company is operating their business at much wide level and they are
providing products and services to people at worldwide. There are many kinds of laws and
regulations formulated by respective governance which must be follow by associations.
Therefore, entire work get fulfilled ethically. If they are following acts into business then some
sorts of fines will be imposed on enterprise. This will remove illegal aspects of affiliation which
render positive influence on individuals. Rather than, if they are doing mistakes on continuous
basis then this will cater negative affect on persons.
 Positive- According to this element an organization can easily accomplish their business
operations without facing any fraudulent acts and wrongful conducts. Mainly, political
bodies are playing crucial role in preventing seller and buyer from any wring conducts.
 Negative- Sometime it act as restricted rules or regulations as well as act as major
obstacles for company while performing business operations.
Economic factors: It has been determined that, income level of an individual will provide
influence to their purchasing power. This element need to be appropriate because this will affect
an enterprise's profitability as well as production. It is must to provide products to persons as per
their choice because it will give them maximum satisfaction.
 Positive- If profits of bank is high then, recession in nation will never affect their firm.
However, sometime fluctuation in currency rates are beneficial for long term contract of
an organisation.
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 Negative- If there is any rise in tax rates then this will affect firm negatively. Mainly,
profit of an association get affected due to changes in several economical elements.
Social factors: There are several factors i.e. culture, belief, values etc. of an individual
which will provide effect on organisation either in an direct or indirect manner. It has been
evaluated that, each person wants to fulfil their needs and wants as per their preferences. If
company is able to accomplish desires of people then this will render positive influence on them.
Rather than, if demands of individual in alter on regular basis then, this will shackle production
system of affiliation (Cavusgil and et. al., 2014).
 Positive- Analysis of consumer choice or preferences is highly indispensable for
company success because it aids in assisting Barclays's while designing policies for
clients. It aids in creating positive relations with entire society.
 Negative- By assessing customer perspectives can maximize the production cost of an
association.
Technological factors: In recent times, it is required for each companies to use latest
tools as well as method because this will help them to take benefits from contenders at
marketplace. In relation to BARCLAYS, they are providing many new services to their clients,
such as ATM, debit/ credit card, net banking and many others. Along with, by utilizing
application of bank, individuals will easily transfer fund to each others. This will provide
positive affect on people. But if firm charge high amount of using it, then this will provide an
adverse affect on persons.
 Positive- It helps Barclays's while managing business operations in much better manner
as well as supports in safeguarding the time period of organization.
 Negative- Complex features of high tech or modern technology creates problems for staff
members while handling it.
Environmental factors: If paper work get reduced and organisation is using new methods
then this will assist to secure surrounding from any type of harmful activities. This will aid to
decrease unnecessary amount. It will provide growth as well enhancement to affiliation which
will help them to survive at marketplace for maximum period of time. These type of activities
will provide positive affect on individuals.
 Positive- Resources which are used by bank is acquired by the environment only as well
as final users are also comes from there only.
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 Negative- Changes in micro and macro surroundings have a major impact on company
performance and creates problem.
Legal factors: There are numerous types of laws as well as acts are developed by
regulatory body which need to be follow by company. If they are not following it, then this will
affect business operations in a negative manner. Because, legislations are much helpful to secure
firm from any misconduct activity. Proper standards have to be taken after by manager of an
enterprise because this will cater positive affect on mind of clients.
 Positive- Aids in preventing buyer or seller and create peaceful environment at
workplace which automatically enhance the company productivity.
 Negative- Act as major barrier in company success.
TASK 4
P 5. Internal and external analysis of BARCLAYS for identifying its strength and weakness
Internal analysis of any business refer to system in which the factors that are present within
the boundaries of an enterprise are evaluated. It assists in doing future planning which is than
more effective as it is based on the organisations strengths and weaknesses. Business
environment of company is mainly affected by its internal and external factors which are
associated with operational activities. Therefore, it is essential for firm to analyse and evaluate
all elements which are affecting business exercises. For examining factors, SWOT investigation
is best technique to find out strength, weaknesses, opportunities and threat. Also, with assistance
of this, impact of internal factors will determine which will include employees, employers,
mission and vision statement, management and many more. While on other hand, external
factors aid to identify customers, stakeholders, competitors, business ethics etc. These analysis
has been done on BARCLAYS which is a retail and commercial. Thus, to evaluate impact of it
on its business environment, SWOT analysis will be done in which internal and external analysis
is done for the referred enterprise:
Internal Analysis
Strengths: - Diverse business profile of BARCLAYS make it best retail and commercial
bank in UK. Distribution network of firm is much effective which aid to attract many customers.
Along with, they are giving qualitative goods and services to people to render them maximum
level of satisfaction. Company is investing maximum amount of fund on training and
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development program. These sessions help them to improve working performance of staff
members. As a result, employees will be able to accomplish desired goals and targets within
limited period of time. Due to contribution of workers, BARCLAYS is successful executing
change management into its workforce. This enables them to formulating new services and
products as well as getting good return on capital expenditures. In order to build impressive
brand portfolio, it has made huge investment on the same. Some of the major strength are
discussed below:-
 Biggest player in banking sector as well as financial services space.
 Having business in retail sector also, investment banking as well as act as a famous brand
across the nation.
 Offering financial services to most of the successful business for developing their
enterprise.
 They are having almost 4500 branches and operations in around 50 nations.
 Offers personal banking services by establishing post office branches across the regions.
Weaknesses: - From appearance of last five years of performance in business,
BARCLAYS is not much profitable. They faced loss in billions also. Main problem behind
failure in probability as well as capitalization is due to its maximum loss through loan. Declining
operational efficiency is affecting their margins (Carroll and Shabana,2010). Due to excess loan
growth over deposits, BARCLAYS is not able now to face new challenges and threats at
marketplace. Because of these situations, organisation is fail to gain market share. Therefore, in
order to overcome from these issues, they need fund so that they will introduce new technologies
in firm. This fund assists in building its operations more effective as well as to increase
productivity and profitability. Instead of, major weaknesses as calculated about bank is
controversies related to internal audit. It has damaged its brand image at marketplace and give
chance to its competitors to come over.
 Extra bonuses to the directors due to the outstanding reputation of banks at marketplace.
 Ethical tangles means company is engaging in ethical issues by offering suitable services
to the people.
External analysis
Opportunities: - In order to overcome from loss in probability, new taxation policy of
government is catering them a chance. In fact, innovation in banking system and digitalisation
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such as block-chain technologies helps in transaction to avenue for growth. Inflation period of
economies, brings stability of its business at marketplace.
 Maximized the financial information across the regions.
 Emerging markets due to which company is getting chances of developing them across
the regions.
Threats: - New capital requirement and some more regulatory pressure by government
has generated threats for expansion of such a business organisation. These regulatory pressure
also increases competition for BARCLAYS.
 One of the major danger which is faced by company is that in 2000 Barclays's was closed
number of branches due to that other banks have adopted numerous of advantages of this
issue.
 Economic stability is a major threat which is faced by banking sector.
P 6. Interrelation of strengths and weaknesses with exterior macro elements
Business environment is also falls down as the factor and power that influence the firm
through arranging operations of the enterprise effecting the condition of them among trade and
buyers at the same time. There are two major categories variables that effects the organisation for
example, external and internal environment of working. Barclays is one of the signifying UK
firm that has flourish their branches of business that aims financial support as the prominent
objective to public and private firms for match up the short and long term vision and goal.
Prominently, firm has developed their activities of enterprise across the country and other
nation to that there is a larger influence of outer factors that is required to evaluate by the firm.
Various actions and business environment are interlinked with each other’s that affects the
practises of business. This is more signify to analyse the behave of persons. Hence, outer and
inner elements in different techniques are detailed below:
Political and Legislative Factor: In accordance to the political and legislation changes
in the enterprise can be affected as the team of the management needs to frame principles,
control and approaches so it will influence the promoter and advertiser which they will alter their
standards. This is important for the firm to determine the activities on the grounds of it in order
to match the desired objective in better way.
 Strength :- Political factors is highly effective for company while showing the current
changes in other elements as well as aids Barclays while providing financial support to
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others. For example; introduce some of the major norms which is applied at corporate
world for controlling probabilities of mistakes.
 Weakness- Whereas somehow political norms are affecting the company strategies and
act as major obstacle in the success.
Social Factor: The social and cultural alteration effects entire business highlights the
prominent indicator with the help of selection and manners of multi culture by costumers. This
effects the buyers or services user in accordance to the needs, requirements, preference in context
of modification (Cantwell and et. al., 2010).
 strength-:- Society is liable for final consumption of products due to which consideration
of social elements are highly indispensable for company success. Along with this, it aids
in managing business operations as well as assist production department of an
organization.
 weakness:- Sometime it may increase the production cost of an association.
Technological Factor: Existing product and service flow can be arranged with the aiding
of new techniques along with helping in firm that are having the interest through associating
innovative desire. Structure of management and its advancement can helpful in smooth and
better operation functioning of firm in effective manner.
 Strength- Emergence of high tech equipments are helping in managing business
activities in proper manner as well as safeguard the confidential information from getting
misused.
 Weakness- Hard to understand due to complex features and company needs to offer high
level training and development session to their employees for teaching them in effective
way.
Economical Factor: this is determine as the signify power that affects external and other
situations of organisation. It make influence of the framing of firm along with the procedure of
leadership among customers. These elements incorporate financial stability, expansion and
arrangement of trade or market rates and so on.
Environmental Components: lack in reduction of needed factor, effect of carbon
objective undertakes by state, and morals of firm etc. are the factors in the natural elements so
that change management in dynamic situation in the firm can be maintained.
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CONCLUSION
From the above based project, it can be summarised that element existing in business
environment are providing signify effect on the working of every organisation regard the
Barclays. Component such as environment, politics, society, technology, legalisation, etc. has
been determinant venture in both positive as well as negative manner that has represented in this
assignment. Apart from this, various aspects like size, scope or legal unit and intentions of
assorted companies for example public, private and voluntary is also detailed in this report. Also
the ability, weakness, opportunity and threat as well of Barclays group has represented clearly.
Other side pestle analyses is also lighted.
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REFERENCES
Books and Journals
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Online
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MARKETING THEORIES – PESTEL ANALYSIS. 2017. Available through :
<https://www.professionalacademy.com/blogs-and-advice/marketing-theories---pestel-
analysis>.
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