Business and Environment: PESTLE, SWOT and Decision Making

This report provides a comprehensive analysis of LIDL's business environment, employing PESTLE and SWOT frameworks to assess the impact of external and internal factors on the company. The PESTLE analysis examines political, economic, social, technological, legal, and environmental factors affecting LIDL, including Brexit's impact and changes in customer preferences. The SWOT analysis identifies LIDL's strengths, such as rapid expansion, and weaknesses, such as limited presence outside Europe, alongside opportunities like discount offerings and threats from new market entrants. The report further analyzes how these internal and external factors influence LIDL's decision-making processes, emphasizing the interrelation between these elements and their collective impact on the company's operations and success. The conclusion summarizes the key findings, highlighting the interconnectedness of internal and external factors in shaping LIDL's strategic approach and market position, supported by cited references.

BUSINESS AND BUSINESS
ENVIRONMENT
PART 2

Table of Contents
■ INTRODUCTION
■ PESTLE analysis to identify different macro environmental components
■ SWOT analysis of LIDL company to identify its strengths and weaknesses
■ Analyse the impact of internal and external environment on decision-making
■ CONCLUSION
■ REFERENCES

INTRODUCTION
■ This report explain PESTLE and SWOT analysis to identify or determine the external
and internal factors impact on company.
■ It also justifies the influence of internal and external factors upon decision making
procedure of LIDL.

PESTLE analysis to identify different macro
environmental components
PESTLE is one of the strategic model used for organizations to measure macro
environmental or external factors impact on business. It is the best framework used to
monitor and analyse various components that may affect on company's performance and
operational efficiencies both negative and positive sides.
Political factor-
Tax policy, environmental law, labour law, foreign trade, government policy and
political instability or stability in overseas markets is included in Political factors that effect
business or LIDL firm. Brexit is one of the main issue or factor that impact on company at
negative sides as it make difficulties for organization to operate their business in other
nation. Britain votes to leave EU that create most difficult environment for organizations
working with Britain. Positive impact- Brexit procedure also put positive impact on LIDL,
after Brexit company are more undependable on other for increasing profit, they serve its
best services or products to customers.

CONTI…
Economic factor-
Economic elements are all those factors that pertain to economy of nation that
LIDL operates, such as changes in foreign exchange rate, inflation rate and interest rate.
High level of unemployment is one of the major factor that impact on company. Positive
impact- Higher stage of unemployment give positive effect organization, most talented
people company hire via employing that enhance its productivity the most. Negative
impact- but on the other hand unemployment after Brexit make negative influence on firm
as they must hire people whether they are qualified or not it impacts on company
profitability.
Social factor-
Socio-cultural factors include cultural trends, population and demographic
analytics that impact on LIDL company. Changes in customer preferences is one of the
major elements that affect on organization operational efficiencies the most.

CONTI…
Positive impact- They provide discount offers to consumers which is beneficial
for people, changes in discount model help to attract more people towards business and
drive the new ones as well which increase profitability. Negative impact- Changes in
discount model make negative impact on LIDL profit margin and financial budgets the most
which is not suitable for them as business growth in marketplace.
Technology factor-
Technology elements related to the innovations, technological aspects, incentives
and barriers. Emerging technologies, research and innovation, intellectual property issues,
maturity of technology and technology legislation are the factors include in technology
external environment factor. Positive impact- Technology development made LIDL
stronger than its competitors which is beneficial for them. But on the other hand it makes
negative impacts on their profitability and financial budgets, to implement new and
advanced technology company need to invest more money which might be not possible for
them.

CONTI..
Legal factor-
Legal factors relates to regulation, laws and legislation that affect way business
operates in country or around the world. Changes in Future and current legislation,
international legislation, consumer protection, employment law, competitive regulations and
tax regulation impact on company. Positive impact- Discrimination law is the factors that
impact on LIDL, if company implement norm as according to this law in their business they
assure workers safety and well being which garb the attention of people. Negative impact–
but if company cannot follow principles of discrimination law high employee turn over
situation will create that is not suitable for them.

CONTI…
Environmental factor-
Environmental components related to environmental and ecological aspects that
will influence demand for organization's goods and how that business will operates.
Reduction of carbon footprint, affect of adverse weather, environmental regulations and
ecological regulations are the factors included in environmental elements. Positive impact-
If company play their role in CSR they can be able to serve its best and better than before
and also build market reputation in UK. But on the other Side by not paying role in CSR
system LIDL company decrease their position and cannot gain high revenue, as it impact
negatively on business.

SWOT analysis of LIDL company to
identify its strengths and weaknesses
Strengthen:
LIDL make rapid expansion plans which is very beneficial as for whole
business growth and success in UK market.
Weakness:
Company have limited presence outside of Europe which shows their
weakness and it impacts on existing operations.
Opportunities:
LIDL is German international discount supermarket chain that offers the
best discount facilities on products and give affordable price things. With
this opportunity they are able to garb the attentions and enhance
productivity.
Threat:
New entrants in UK retail business market is one of threaten situation

Internal factors interrelations with External factors-
■ Organization rapid expansion strategy is successful if they follow all the legal
procedure and government trade policy which is beneficial for business success.
■ Firm grab the attention of customers more than new entrants in marketplace
through implement advanced technology in business structure which is an external
element that increase profitability of firm.

Analyse of internal and external
environment impact on decision-making
The external environment is affect the decision of the firm there are different
external factors which affects the Decision of the firm such as political, economical,
environmental, social, legal, etc. Therefore, such government rules and regulation is
influence the performance of the firm In negative and positive way. Therefore, such
technological factor is also influenced the performance of the firm like, The new trends is
needs the new technology so firm cannot generate high production by lack of technology.
Internal factors is also influenced the decision-making power of the firm. For
example, conflicts between employees it can negative impact on the productivity of the
firm. In other side good relationship between employees is created the positive impact on
the performance of the firm that they are increase their productivity. Therefore, negative
environment is also affects the work place which influence the decision of leaders and
mangers.

CONCLUSION
■ It has been concluded that political factors, social factors and other
external environmental elements has impact on LIDL company and
also upon their daily operations.
■ From above its has been summarized that Strength, weakness,
opportunity and threat reflect those internal factors that impact on
organization and show its capabilities.
■ External and internal factors are connected with each other based on
company working style functions and activities.