Pestle Analysis of ASDA Supermarket: Opportunities and Threats

This report provides a Pestle analysis of ASDA supermarket, focusing on the political, economic, social, technological, legal, and environmental factors. It discusses the opportunities and threats linked to these factors and their impact on the organization's performance. The report concludes that the opportunities offered by the macro environment outweigh the associated threats.

GLOBAL
BUSINESS
ENVIRONMENT

EXECUTIVE SUMMARY
Report highlights the Pestle analysis of ASDA supermarket and also different opportunity
and threat linked with the same in the market as well.

INTRODUCTION
Asda is one of the biggest retail sector organization of UK. Asda was formulated in the
year 1949 by Noel Stockdale and J.W. Hindell.
PESTLE ANALYSIS
PESTLE analysis is a framework to analyse the key factors influencing an organisation
from the outside
Political Factor
Political factor is generally define the extent to which the government of the nation is having the
power to influence the organization performance. Government policy related to business is one
example (Perera, 2017).
Opportunity
 There is good political stability which will help company in pursuing with same policy
for longer period of time
 Political parties in nation generally used to supports the privatization, this is good for
Asda.
Threat
 Brexit has created variety of the restriction for the company in regards of trading with
neighbour nation
 Foreign trade policy of nation generally impact the operation of business
Economic factor
These factor determine the direct economy impact on performance of the business in the long
run.
Opportunity
 Interest rate is favourable which will help the company in funding different operation
very easily.
 UK economy is a developed economy which will ultimately help the company in getting
advantage in term of higher return on their product (Nandonde, 2019).
Threat

 As explain Foreign trade policy is not that simple, it used to create the issue of higher
foreign exchange rate
 Rate of water and diesel is increasing at rapid rate which will create the issue of cost
enhancement.
Social Factor
These factor scrutinize the impact of social factor on organization performance
Opportunity
 Change in need and preference had created good opportunity for company to manufacture
new product.
 Good sort of cultural trend in the market help company in selling their product as Asda
generally has cultural touch in their product.
Threat
 Change in trend on regular basis generally used to impact the organization as operation
line has to change
 Social factor may create the situation where it will be difficult for organization to decide
their targeted customer base
Technological Factor
Impact seen by organization performance due to change in technology
Opportunity
 Open up good opportunity to use new technology to develop new product of company
 Innovative technology ultimately help in enhancing efficiency of production in an
organizational(Gheibi and et.al., 2018).
Threat
 Increase the cost of the company, in regards of procuring machinery
 Create issue in understanding the best machinery available in the market
Legal factor
These factor shows impact of legal policy on organization performance

Opportunity
 Following legal factor help in building good will
 Compiling different factor with legal compliance help company in avoiding legal
compliance
Threat
 Sometime complicate different operation
 Non followence of same may result in legal cases as well
Environmental factor
These factor shows the impact of environmental factor on organization performance
Opportunity
 Green HRM activity may help company in overcoming issue related to environmental
factor
 There is good opportunity of offering a organic food in market.
Threat
Composition of Hazardous waste is big threat for company in long run
Pollution caused by Asda store is another big threat for company
CONCLUSION
After going through the above Pestle analysis it had been understand that opportunity
offered by Macro environment good enough to ignore the threat linked with the same.

REFERENCES
Books and journals
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Nandonde, F. A., 2019. A PESTLE analysis of international retailing in the East African
Community. Global Business and Organizational Excellence. 38(4). pp.54-61.
Gheibi, M and et.al., 2018. Controlling air pollution in a city: A perspective from SOAR‐
PESTLE analysis. Integrated environmental assessment and management. 14(4).
pp.480-488.

APPENDIX 1
Political Factor  Political Stability
 Government support
 Brexit
 Foreign Exchange policy
Economic factor  Interest rate
 Developed economy
 Foreign Trade policy
 Rate of diesel and water
Social Factor  Need of new product
 Cultural Trend
 Change in trend on regular
basis
 Issue in deciding customer
base
Technological
Factor
 New technology procurement
 Efficiency enhancement
 Enhance cost of production
 Understanding best
technology
Legal factor  Builds goodwill
 Avoiding legal compliance
 Complicate operation of
company
 Legal cases in past
Environmental
factor
 Green HRM
 organic food
 Composition of Hazardous
waste
 Pollution