Market Analysis of Dyson: PESTLE Analysis and Porter's Five Forces Framework

This report provides a market analysis of Dyson, a British technology company that designs and manufactures household appliances. It includes a PESTLE analysis and Porter's Five Forces Framework to identify the internal and external environment of the company.

Dyson

MARKET ANALYSIS 1
Introduction
Market analysis is a study of the business environment of the company. To achieve
success in the market it is necessary to analyse the internal and external environment. There
are many analysis tools which are used to analyse the business environment such as SWOT
Analysis, PESTLE Analysis, and many others. It helps to identify the strength and weakness
of the company. In this report, Dyson is taken into consideration to analyse the internal and
external environment of the company. Dyson is a British technology company which is
designed and manufactured the household appliances such as bladeless fans, hair dryers,
heater, vacuum cleaner, and many others. The company earned $2.5 billion with the help of
8500 employees. The company was established in 1974 by the James Dyson (Dyson, 2018).
In the starting of the report, politics, economic and social environment will be
discussed which affect the success of the organisation. After that, the strength, weakness of
the company will be discussed.
PESTLE Analysis
Political
The political factor of UK affects the business plan of Dyson. In the current time, the
government is expected to change the policy which affects the organisation sales as well as
supply chain of the company such as exchange rate policy and many others (Jenkins, &
Williamson, 2015).
Economical

MARKET ANALYSIS 2
Economic factors like interest rate, growth rate, and exchange rate affect the business
of Dyson. Due to the high inflation rate, the bargaining power of the buyer is reduced and the
demand of the consumers is also reduced.
Social
Customers are very much aware of the product; it is very important for companies to
fulfil consumer demand. Nowadays, innovative technologies and designs are the market trend
from which the consumers can attract towards the services of the companies.
Technology
Manufacturing of Dyson is all about the innovative technology and to deliver the
services that are very innovative which are very important for sale. The company has to
update with the new technology which comes in the market (Aydalot, & Keeble, 2018).
Legal
There are many rules and regulation in the UK market related to selling their product
legally in all the market. These laws include the trademark, employment laws, patent
requirements, and many others. It is necessary for the company to make the appropriate bills
to aware the customer.
Environmental
It is the responsibility of the company to aware of the demand of customer and
environment. Dyson provides the cleaning product but these products are manufactured by
consuming the high electricity which affects the environment (Rastogi, & Trivedi, 2016).
Porter’s Five Forces Framework
Bargaining buyer of buyer

MARKET ANALYSIS 3
It has been seen that the customer has many options due to many brands in the market
who sell the same product. The customer has the many options to buy the product and can
switch their demand with their low price product. To beat each other, the companies low their
prices to attract the customer which is beneficial for the buyer to compare and select the low
price product (Dobbs, 2014).
Bargaining buyer of Supplier
The company has the responsibility to deliver the quality of services due to which it
has to make a strong relation with the suppliers. Suppliers are the only source from which the
company gets the raw material to manufacture the product. There is a numerous number of
buyer due to which the barraging power of buyer is low.
The threat of new entrants
It has been seen that the company earned a high profit in the UK and even more in the
global market. The company introduced the product with the high quality and it is quite
different from the other competitors. It is a barrier for the new entrants to enter the market
with the high capital. It becomes difficult for the new entrants to beat the high brand power
companies due to which the threat of new entrants is low (Rothaermel, 2015).
Threat of Substitute
The demand of the consumers is fluctuating and the economic environment has been
unpredictable. Although the new entrants cannot enter easily in the market if the company
enter with the superior technology then the company has the threat of substitute. There are
many places where the vacuum cleaner is not used as a floor cleaning source instead of a
broomstick.
Threat of competitor

MARKET ANALYSIS 4
There are many competitors who have a high demand for their product and who
produce a similar product in the market. The company has a high threat of competitors and it
has been seen that the threat of substitute is also high. Due to selling a similar product in the
market increase the high threat of substitute the threat of competitors is also high (Rastogi, &
Trivedi, 2016).
SWOT analysis
Strength
It has been seen that the company manufacture the innovative product by using the
technology to attract the customer. The innovative product is the main strength of the
company. The company manufactures the innovative product but it also maintains the quality
of the product with the help of employees. Product and employees of the company are the
main strength of the company (Bull, et al., 2016).
Weakness
It has been seen that the company sale the innovative product which consumes high
cost. Due to the high cost the prices of the company is also high prices as compared to the
competitors. The cost of manufacturing product is high but it is a reason for the lack of
consumers in the market.
Opportunity
The company has the opportunity to expand the business at the international level. As
the demand of the customer is getting change especially in the household appliance. New
feature attracts the customer towards the goods and service. The company has the opportunity
to attract the new customer by adding the new features.

MARKET ANALYSIS 5
Threat
It has been found that the cheaper bagless vacuum cleaner is the main threat of the
company. The competitors with the high brand power are also a threat to the company
because they can easily beat the company in the competition (Caraway, 2015).
Conclusion
From the above analysis, it has been concluded that the company manufactures the
innovate product with the high technology which is a strength of the company. But the
serious weakness of the company is its high prices due to which the threat of competitor is
also rising and there are many political factors which affect the sale and business plan of the
company. Bargaining power of buyer and supplier is also affected by the high threat of
competitors. It has been concluded that the company can reduce its weakness by using its
strength.

MARKET ANALYSIS 6
References
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Dobbs, E. M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
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Dyson. 2018. Overview. [online] Available from:
https://www.dyson.com/for-business/dyson-business/dyson-for-business.html
[Accessed 31/10/18].
Jenkins, W. & Williamson, D., 2015. Strategic management and business analysis.
Routledge.
Rastogi, N. & Trivedi, M.K., 2016. PESTLE technique–a tool to identify external risks in
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(IRJET), 3(1), pp.384-388.
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