E-Business: PESTLE and 5 Forces Analysis, Core Competencies, and Strategy Recommendation

This article provides an analysis of the external business environment of Slices, an e-business in UAE, using PESTLE and 5 forces analysis. It also discusses the core competencies of the company and provides a strategy recommendation.

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Running head: E-BUSINESS
E-Business
Name of Student
Name of University
Author Note

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Table of contents
PESTLE analysis........................................................................................................................2
5 forces analysis.........................................................................................................................3
Core Competencies....................................................................................................................4
Strategy Recommendation.........................................................................................................4
Bibliography...............................................................................................................................6

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PESTLE analysis
The PESTLE analysis is done to identify the external threats that may affect the
business (Srdjevic, Bajcetic and Srdjevic 2015, p.3379). These consist of the analysis of the
business environment in which an organisation functions. The components of PESTLE are
analysed taking into consideration the situation that Slice faces.
Political: The political factor in the UAE in terms of maintaining the health of the
people is low. Thereby, the Government can have to undertake few actions that may affect
the functioning of the company. The political factor of UAE is that it provides opportunities
for market growth only if it does not have a negative impact on the environment and social
life. Slices is a Government entity and thereby can get an advantage in the business market.
Economical: UAE boasts a strong economic presence and due to this, companies
established in the UAE do not have to bother with the fluctuation in the economy. Hence, the
economic factor can be of assistance to Slices, as the company is new and the investment by
the company on the stakeholders has a positive impact.
Social: UAE is rated as the fifth fattest country in the world. The excess consumption
of fast food in the world may be the reason for the increased health problem. Despite this, the
people of UAE have a strong response to the new company and the products manufactured by
it. The recorded revenue of AED 3,800,000 of the company in the first year indicates the
passion of the consumption of the fast food of the people.
Technological: The technological factor in the UAE is high and the companies in the
country use high-tech technology to continue its operations. The network of the supply chain
that the company have built indicates the requirement and effects of technology in the
company.

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Legal: The legal policies usually prevent organisations from violating any type of
rules. One of the key elements of the legal policies is that it takes into account the rules and
procedure set up by an organisation (Newton 2014, p.444). In the case of Slices, the company
need to maintain the legal rules of the country mainly because it is a Government
organisation and the Government states the rules.
Environmental: This is one of the important aspects of conducting an external
business environment analysis. Slices aim to create an environment in which students learn to
eat healthily and remain fit. Benchmarking is done based on the models that are followed in
countries like USA, UK and the World Health Organisation.
5 forces analysis
According to Dobbs (2014, p.32), Porter's five force analysis helps in identifying the
immediate threats that exist in a business. The threats are divided into five factors and the
magnitude of the threats are measured based on the impact it may have on an organisation.
Threat of substitutes: The threat of substitute usually denotes whether a particular
product has any other replacements in the market. Despite the success in the first year of a
market, Slices still have to deal with the substitutes as other companies may provide similar
products keeping in mind the health condition of the people.
Threat of rivals: The threat of rivals is high in this case as the competitors are mainly
established in the markets of UAE. The prices and the products sold by Slices may have to
come under huge threat from the established market as the loyalty of the customers are more
inclined towards the consumption of food from these restaurants.
Bargaining power of suppliers: The major suppliers of Slices include Abu Dhabi
Organics, Milk and Honey Organic Outlet, Raw Coffee, Jam and so on. These are reputed

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suppliers in the country Slices low threat from them due to other suppliers that exist in the
country.
Bargaining power of buyers: The bargaining of buyers constitutes the purchasing of
the buyers. The buyers of the company are mainly the people that love fast food and the
company targets the students and offer them guidance about the importance of eating healthy.
Hence, this treat can be considered as low.
Threat of new entrants: The threat of new entrants in the case of Slices includes the
franchise format. Usually gaining entry in the markets of UAE requires franchising which in
turn refers to gaining authorisation from the Government of UAE. Thus, this particular threat
is low for the company in the business market of UAE.
Core Competencies
The tangible assets of Slices include the physical assets of the company. This involves
the cash in hand and the machinery. On the other hand, the intangible assets include the
resources, which comprise of the employees and other non-physical assets of the company.
According to Byun (2015, p.141), the two types of assets help in analysing the knowledge
and skills of the employees in the organisation. The core competencies of Slices are
characterised by the activities as well as the processes that are involved in the effective
deployment of resources. One of the advantages of Slices is that it offers meals and programs
based on the needs and requirements of the customers. Thereby the knowledge generated by
the company is mainly from the analysis of the responses provided by the customers.
Strategy Recommendation
After the analysis of the PESTEL and 5 forces, it can be said that Slices need to adopt
certain changes so that the company can gain more reputation in the market. The fact that it is

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involved with the corporate social responsibility early in its career can help the company
make progress with the people in UAE. The use of organic food materials can help Slices to
continue with preventing any type of health-related issues in a person. This can be a useful
strategy for the company as it can focus on gaining a competitive advantage by maintaining
the health of the people. Competitors such as McDonald’s or Pizza Hut are rumoured to use
an inorganic substance for the manufacturing of the products. Thus, it can be said that Slice
needs to maintain these changes to continue its success.

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Bibliography
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141-167.
E. Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review, 24(1), pp.32-45.
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Jabeen, F., Ahmad, S.Z. and Khan, M., 2015. Slices: what is next?. Emerald Emerging
Markets Case Studies, 5(4), pp.1-9.
Newton, P., 2014. What is the PESTLE Analysis?. Pearson
Srdjevic, Z., Bajcetic, R. and Srdjevic, B., 2015. Identifying the criteria set for multicriteria
decision making based on SWOT/PESTLE analysis: a case study of reconstructing a water
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Yang, C.C., 2015. The integrated model of core competence and core capability. Total
Quality Management & Business Excellence, 26(1-2), pp.173-189.