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PESTEL factors of Ikea | Report

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Added on  2019-09-24

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INTRODUCTIONPESTEL analysis is the macro-environmental factor which gives an idea about theexternal factors which will have a direct impact on the strategy as well as the operation of theenterprise. This report will showcase the PESTEL analysis of Ikea. Ikea is the Swedish basedmultinational company that design as well as sell ready to use furniture. The firm has itsoperation present in many countries and as a result of this, the factors like Political, economical,social and technological, etc will have a significant impact on the company. In this report, adescription will be given about the PESTEL factors which will have an impact on Ikea.MAIN BODYPolitical analysisPolitical controversies that have affected the brandIn the recent past, political controversies have caused a significant impact on the overalloperation of the brand. In the year 2012, the firm has accepted some of its furniture which wasmanufactured by East Germany political prisoners. The firm had apologized for the same, but therespective thing had caused a major impact on its global brand image. Due to this, the overallsales of the company were also dropped.Government rules and regulationsThe operation of Ikea is also affected by the rules and regulations which are being framedby the political government of the nation. Following the given context, it can be said that in thepast few years, India and China have taken a step in terms of lowering different political barriersto entry for foreign brands. It is because of the given aspect only; many international brands havetaken steps for expanding their operation in the respective market. For example, Red tape is amajor matter of concern for the brand like Ikea. However, with the help of such type of smoothpolicy, Ikea can expand its presence in the respective market. This will have a direct impact onthe overall sales of the company in an effectual manner.Political instabilityIt is also being regarded as another most important political factor which will have animpact on the company’s operation. For example, a situation like political instability will have a1
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