BIZ304 Business Consulting Project: Qantas PESTLE Analysis Report

This report presents a PESTLE analysis of Qantas Airways, an Australian airline company, within the context of a BIZ304 Business Consulting project. It begins with an overview of Qantas, highlighting its history, services, and value chain activities including inbound logistics, operations, outbound logistics, marketing, and customer service. The report then delves into a quantitative analysis of domestic aviation activity and airfares in Australia. The core of the report is a PESTLE analysis, examining the political, economic, social, technological, environmental, and legal factors affecting Qantas. Political factors include government policies on climate change and investigations into the company. Economic factors cover financial growth, employment rates, and oil prices. Social factors address low-cost travel and diversity. Technological factors discuss digital innovations and sustainable practices. Environmental factors focus on carbon reduction standards and waste management. Legal factors mention discrimination allegations. The report concludes with recommendations for Qantas to maintain its ethical standards and avoid activities that could damage its reputation.

Running Head: QANTAS
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Qantas
Pestle Analysis
REPORT
Student
7/19/2019

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Contents
Introduction............................................................................................................................................2
About the Company...............................................................................................................................2
Quantitative research:............................................................................................................................4
Pestle Analysis.......................................................................................................................................5
Political Factors.................................................................................................................................5
Economic Factors..............................................................................................................................6
Social Factors.....................................................................................................................................6
Technological factors.........................................................................................................................6
Environmental Factors.......................................................................................................................7
Legal Factors.....................................................................................................................................7
Conclusion.............................................................................................................................................8
Bibliography..........................................................................................................................................9

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Introduction
Today, in the fast-paced world, air transport has become a major part of our economy as
it brings diversity, connects different nations, reduced physical barriers and assisted the
government authority in the creation of employment opportunities. However, until now, Aviation
industries is known as one highly monitored industries in the world in which Qantas airways
limited, is one of the powerful national and global airline company of Australia. This Airline
Company has been providing its best services form the century and still considered as the world's
leading long-distance air company of, Australia (Qantas , 2019). However to analyze the effect
of the economy on this airline, in this report Quantitative research and Pestel analysis has been
conducted so the company can preserve its tradition, identify the opportunities and threats that
are prevailing in the competitive market, and bring changes in its strategy according to the
contemporary world.
About the Company
Source: (Seek vector logo, 2019)

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It is one of the oldest airlines after KLM Royal Dutch airlines, Columbian based flight
Avianca, started in Queensland in 1920, which was later merged with Britain Imperial Airways,
and from that point, it was recognized as Qantas Airways Limited. Presently, it has made its
mark in the airline industry not only as a commercial flight but also provides aviation services in
Australia. It is a strong competitor, which has expanded its wing across 20 countries and covers
80 destinations. It rules and operates in the market with its interdependent airlines Qantas and
Jester. Currently, more than 30,000 employees are contributing their efforts to give the
memorable experience to the customers and during the financial year, 2018 it has shown a
consistent growth by taking 22 million customers in 4300 fights on the weekly bases (Invester
Qantas, 2018). A parent company has incorporated with Qantas Freight Enterprises and Qantas
Frequent Flyer. It is one of the highly demanded carrier company as it provides high-quality
services to its customers while emphasizing safety and best technical assistance
Moreover, it was an important part of the history of World War 2, as these aircraft have
been used as military jets as it served an imperative way of communication between the nations.
With the influential journey, the company has maintained its respect and professionalism in the
market.
A. Value Chain Analysis
Inbound Logistics:
It involves maintaining long-lasting relations with the suppliers and distributors so that
the company can procure raw and semi-finished products at the right time. Qantas attain
resources from stationary to the aircraft. The company spends 60% of their annual income over
the dealings with the suppliers.

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Operational activity:
The Company has more than 200 aircraft, which provides the best experience to the
customers. The company has launched innovative technology, which is employed to improves
the system of the company. Qantas aims to attain great efficiency level to outperform other
airline company (Qantas , 2019).
Outbound Logistics:
It means delivering the products to potential customers. It strives hard to provide
premium services while preserving the environment. Moreover, it has become the world's first-
ever airline company that is on the mission to discard 100 million plastic waste from the internal
system of the company (Margolis , 2019).
Marketing:
It is a technique of promoting the services to attract the attention of the customers. In
2017, Qantas invested 70% of its earning in the digital channels as passengers (Baker, 2017),
companies brand, data security and digital platform are the prior priority of the company. It gives
cutthroat competition to its rival by catering to the needs of the customers through innovative
ways at an economical price. For its customer's members, the company has launched pointing
collecting system where they used their earn points in booking hotel, bus for the tours and
flights.
Services:
It is the longest airline with four traveling classes. It has Luxury ( best lounges and
superior services), Business (Qantas Dreamliner), Premium Economy ( it is the most acclaimed

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prime cabin for the passengers) and Economy ( reclining comfortable sofas for the travelers with
delicious refreshments) (Invester Qantas, 2018).
Support Activities
The company has been operating in the economy since the century, and today it has not
only made its mark in the air- transport industry but also entered into the hotel industry with
Qantas hotels. It provides the best cultural tours and activities to its members. This has been
achieved with the hard work of more than 30,000 employees. Moreover, the company fulfills
social responsibility. One of the objectives of Qantas is to represent the achievements of
Australia and motivate other nations with its history. It provides a platform for talented people so
they can realize their potential.

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Source: (CAPA, 2018)
Source: (Bitre, Domestic on time performance, 2019)

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B. Quantitative Research
Source: (Bitre, Domestic aviation activity, 2019)
With the great increment of 0.7%, 5.12 million travelers boarded the domestic flights in May
2019 as compared to the statistics of 2018. Moreover, 4.88 million customers took RPT
( Regular Passenger Traffic) in May 2019 (Bitre, Domestic aviation activity, 2019).

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Source: (Bitre, Domestic Air Fares, 2019)
To promote diversity and tourism, the Aviation industry provides the best offers to its customers
on an annual base. In July 2014, various carriers companies introduced offers in the market.
However, in the recession, companies did not launch further discounts, which increased the
customer’s turnover. In 2019, companies have come up with great offers so that, there will be a
balance of demand and supply in the market (Bitre, Domestic Air Fares, 2019).

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C. Pestle Analysis
Source: (Business-to-you, 2016)
It is a tool used by companies to evaluate and monitor the impact of various macro-
environmental factors over the effectiveness of the company. The analyzation is based on
political, economic, social, technological, environmental and legal factors. All these features are
discussed below (Business-to-you, 2016):
Political Factors
It involves the influence of government reforms, political stability, and any kind of
fluctuations in the import and export policy, employment laws over the performance of the
company. All these components need to be considered while operating the potential market. In
Australia, climate change is threatening the stability of the economy, therefore to reduce the
emission of toxic components, the government has launched electronic air-craft and is promoting
pollution-free transport (Lousiikian & Shields, 2019). This new policy will not only help the

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company to earn great profit but assist the company in fulfilling the needs of the consumers as
this electric method will save the cost of operation. Moreover, in 2019, the federal commission
of Australia investigated Qantas in the case regarding the secretive arrangement of ABC
journalists who had leaked the confidential informational related malpractice of Australian
troops in Afghanistan.
Economic Factors
These factors affect the economic performance of an economy. Financial growth,
fluctuations in employment rates, and interest rates are some of the determinants that influence
the buying capacity of the consumers. To promote the interest of the native people, Qantas
provides ample employment opportunities so that they can live their lives independently.
Moreover, lower oil rates have strengthened the economy of Australia ( US$81.3/barrel in 2019,
lower than the US$87.6/barrel average for 2018) as now there will be more demand, increase in
revenue generation and creation of job in the aviation industry (Murphy, 2019).
Social Factors
They are considered as demographic factors, customs across which the company
operates. In Australia, low-cost traveling has enabled people to travel across countries. Such
reforms have helped Qantas to bring diversity in the country. It has fulfilled the need of people
and the company is striving hard to provide the best traveling experience to its customers.
Technological factors
They are the determinants, which involve the innovations, and in the context of technology, that
affects the functions of the company on a wider scale. In Australia, the era of digital and
sustainable has begun so the traffic can be managed easily on the airport highly powered runway

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functions can be managed effectively (Ludlow, 2019). The industry will be replacing high and
dangerous emitting technologies with low emission and biofuels, the separate building of
renewable energy, development of set-up for the proper functioning of aviation activities, highly
monitored security and innovation of electric devices to manage the passengers on the flight
(Sabatani, 2015). In 2018, Qantas has entered with the modern technical expertise to improve the
booking services so it enhances the experience of its customers.
Environmental Factors
It is one of the parts of the economy, which has become part due to the scarcity of
resources, an increase in the greenhouse effect. It includes all the factors in the aspect of the
environment. To curb the impact of carbon, the government has stated the policy in which the
loans will become cheaper or the company has to pay low interest, if they meet the carbon
reduction standards and if companies failed to meet their targets they will be penalized.
Moreover, Qantas is identifying ways to revamp wastage, which is produced around 30,000 on
an annual basis (Murphy, 2019).
Legal Factors
It describes the policies in a more precise way. It includes laws related to discrimination,
employment, and health and safety laws. In 2018, Bollywood Actress and businesspersons
Shilpa Shetty Kundra report the Qantas did racial discrimination and mistreated her when she
was not allowed to enter with her oversized duffle bag then the rest of other bags (Arora, 2018).
D. Recommendations
Qantas is a powerful airline company in Australia, which is dominating the market with
its superior services'. However, due to leak, the misconduct by the Australian military in the

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Afghanistan land put a question mark over the illegal and confidential activities of the company.
Therefore, the company should not indulge in any activities, which can cost its morality.

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Bibliography
Arora, A. (2018, September 24). Shilpa Shetty alleges racial discrimination by Qantas staff at
Sydney airport. Retrieved 2019, from SBS:
https://www.sbs.com.au/yourlanguage/punjabi/en/article/2018/09/24/shilpa-shetty-
alleges-racial-discrimination-qantas-staff-sydney-airport
Baker, R. (2017, Febuary 23). Qantas spends 70% of its marketing budget on digital. Retrieved
2019, from AD news: http://www.adnews.com.au/news/qantas-spends-70-of-its-
marketing-budget-on-digital
Bitre. (2019). Domestic Air Fares. Retrieved 2019, from Bitre:
https://www.bitre.gov.au/statistics/aviation/air_fares.aspx
Bitre. (2019). Domestic aviation activity. Retrieved 2019, from Bitre:
https://www.bitre.gov.au/statistics/aviation/domestic.aspx
Bitre. (2019). Domestic on time performance. Retrieved 2019, from Bitre:
https://www.bitre.gov.au/statistics/aviation/otphome.aspx
Business-to-you. (2016, September 16). Scanning the Environment: PESTEL Analysis. Retrieved
2019, from Business to you: https://www.business-to-you.com/scanning-the-
environment-pestel-analysis/
CAPA. (2018, April 13). South Pacific Aviation Outlook 2018. Retrieved 2019, from CAPA:
https://centreforaviation.com/analysis/airline-leader/south-pacifica-aviation-outlook-

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2018-411231
Invester Qantas. (2018, August 23). Qantas Airways Limited FY18 Results. Retrieved 2019, from
Invester Qantas:
https://investor.qantas.com/FormBuilder/_Resource/_module/doLLG5ufYkCyEPjF1tpgy
w/file/full-year-results/FY18investorPresentation.pdf
Lousiikian , K., & Shields, B. (2019, July 7). Federal police forced Qantas to hand over the
private travel records of an ABC journalist. Retrieved 2019, from The Sydney Morning
Hearld : https://www.smh.com.au/national/federal-police-forced-qantas-to-hand-over-
the-private-travel-records-of-an-abc-journalist-20190707-p524xu.html
Ludlow, M. (2019, July 16). Cheaper loans for meeting carbon targets. Retrieved 2019, from
Financial Review: https://www.afr.com/business/transport/cheaper-loans-for-meeting-
carbon-targets-20190715-p527b7
Margolis , J. (2019, June 24). This Australian airline invites you to ‘sit back and enjoy the
world’s first zero-waste flight’. Retrieved 2019, from PRI:
https://www.pri.org/stories/2019-06-24/australian-airline-invites-you-sit-back-and-enjoy-
world-s-first-zero-waste-flight
Murphy, K. (2019, March 31). 50% of new cars to be electric vehicles by 2030 under Labor
climate change policy. Retrieved 2019, from Support The Guardian :
https://www.theguardian.com/australia-news/2019/apr/01/50-of-new-cars-to-be-electric-
vehicles-by-2030-under-labor-climate-change-policy#img-1

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Qantas . (2019). The Qantas Story. Retrieved 2019, from Qantas:
https://www.qantas.com/travel/airlines/history/global/en
Sabatani, R. (2015, June). A Roadmap for Future Aviation Research in Australia: Improving
Aviation Safety, Efficiency and Environmental Sustainability. Retrieved 2019, from
Research Gate:
https://www.researchgate.net/publication/278671130_A_Roadmap_for_Future_Aviation
_Research_in_Australia_Improving_Aviation_Safety_Efficiency_and_Environmental_Su
stainability
Seek vector logo. (2019). Qantas Vector Logo. Retrieved 2019, from Seek vector logo:
http://seekvectorlogo.com/qantas-vector-logo-svg/

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