Critical Analysis of External and Internal Environment of Amazon.com

GLOBAL STRATEGY AND
SUSTAINABILITY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Critical analysis of the external environment..............................................................................1
Critical analysis of the internal environment...............................................................................3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5
APPENDICES.................................................................................................................................6
Slide 1: Title.................................................................................................................................6
Slide 2: Table of contents ...........................................................................................................6
Slide 3: Analysis of the external environment.............................................................................7
Slide 4: Continued........................................................................................................................7
Slide 5: Analysis of internal environment ..................................................................................8
Slide 6: Continued........................................................................................................................9
Slide 7: Conclusion....................................................................................................................10
Slide 8: References....................................................................................................................11

INTRODUCTION
Amazon.com is an American multinational company that is operating in the online retail
industry and is one of the largest technology based company. It has been founded in 1994 by the
founder Jeff Bezos and is headquartered in Washington, United States of America. The
operations of the company are around four major areas that is the e-commerce, artificial
intelligence, cloud computing and the digital streaming (Amazon.com, 2021). It has been
providing a wide variety of the product portfolio over its online application of buying to provide
access and fulfil all the needs and expectations of the customers. As per the statistics is the
leading e-retailer in US and is earning approximately net sales of 386 billion dollars. On Forbes
world's best employers list Amazon has been ranked second. This project shall be highlighting
the external environment of Amazon and the various opportunities and threats that are provided
by to the company. Apart from that it shall also analyse the internal environment so that the
strengths and weaknesses of the company can be reflected.
Critical analysis of the external environment
The external environment of Amazon.com can be critically evaluated with the use of the
PESTLE business model so that the opportunities and threats that are lying outside the
organization but impacting the business can be known and catered. Some key factors in the
external environment are:-
Political:-
 One of the most significant factor is the political stability in the country. In the developed
countries like America the stability is good which is advantageous but on the contrary the
operations are spread across the globe and so the company has to comply with the
different political framework which is a threat (Onyusheva and Seenalasataporn, 2018). The e-commerce industry is on boom and the government is trying to promote it further
by providing the necessary support to the country. This is an opportunity to capitalize and
a threat in the form of competition entering the market.
Economical:-
 It is concerned with the economic prosperity of the country which shall be flourishing
and expanding the operations of the business. US is a developed country having
economic stability which is posing growth opportunities to the country (Amazon.com Inc.
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PESTEL/PESTLE Analysis, Recommendations, 2021). This also rises the demand and the
personal disposable income of the potential customers. On the other hand threat is imposed by China having a depressed economy which is one
of the biggest markets for the company and its online business.
Social:-
 The sociocultural changes pertaining to the changed trends and lifestyle have impacted
the profitability of the business in a positive manner. With the rise in the online buying
habits the target market of the company has widened. Apart from that the growth of
consumerism has also posed significant opportunity for the company. The wealth disparity widening the gap between the rich and poor is a threat to the
business.
Technological:-
 The advancements in the technology has been causing opportunities for the business to
capitalize and draw benefits from it (Zarrillo and et.al., 2018). It can also maximize the
operational efficiency of the business by optimizing on the technological requirements.
But constant obsolescence of the technology can also pose threats to the company in
terms of huge capital costs. The technology in central to the operations of the company so, the increasing rates of
cybercrime is threatening for the company.
Legal:-
 The intensifying regulations based on the cyber security protocols are the threat to the
business in the form of increased expenses regarding the same. Various other regulations based on the product, import, export and the environmental
concerns are like the opportunities for the business which can be capitalized upon and the
government intervention is also avoided simultaneously (Quesada and et.al., 2020).
Environmental:-
 The fulfilment of the corporate social responsibility and the ethical code of conduct is the
opportunity for the company based on which the competitive advantage can be gained in
the market. Also, the e-business of the company is not indulged in creating the waste or
generating the pollution.
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