SWOT, PESTEL and Porter 5 Forces Analysis of IKEA

Project

Table of Contents
Introduction......................................................................................................................................3
Main Body.......................................................................................................................................3
SWOT analysis............................................................................................................................3
PESTEL analysis.........................................................................................................................3
Porter 5 Forces............................................................................................................................4
Conclusion.......................................................................................................................................5
REFERNCES:..................................................................................................................................6
Books and Journals:....................................................................................................................6
Online...............................................................................................................................................6

Introduction
It is essential to apply the business models to analyse the effectiveness of a company. To
analyse strength and weakness SWOT model is used, to analyse the impact of external business
environment PESTEL analysis if used and to analyse competitive environment Porter 5 forces is
used. IKEA is an furniture retailer in UK which provide their high quality of furniture to their
customers. The following file covers SWOT, PESTEL and Porter 5 Forces model for IKEA
company.
Main Body
SWOT analysis
Strength-
 IKEA stores are available at both
urban as well as rural areas which
help them to capture more market
shares.
Weakness-
 Lack of expert advice to expand
their business will impact negatively
upon their operations.
Opportunities-
 Expanding market by using joint
venture option where they merge
with another company is effective
for them.
Threats-
 Their competitors have better brand
recognition in the market which
impact negatively upon them.
PESTEL analysis
Political factor- In context of UK, there is no trading restriction for the company based
in UK. Hence, this is beneficial for IKEA company to import raw material from other country
and export their manufactured furniture to capture larger market.
Economical factor- UK is the country which is having good GDP growth rate,
appropriate condition of infrastructure and many others (Tsangas and et. al., 2019). The cost of
raw material in UK is expensive as compared to other countries which impact upon IKEA to
spend more amount on purchasing raw material.