Impact of External Factors on Mercedes: PESTLE Analysis Report

This report provides a PESTLE analysis of Mercedes-Benz, examining the impact of various external environmental factors on its business performance. The analysis covers political, economic, socio-cultural, technological, legal, and environmental factors. The report highlights how fluctuations in these factors, such as changes in tax rates, interest rates, consumer lifestyles, and technological advancements, can influence Mercedes' financial position, market position, and competitive strategies. The study emphasizes the importance of PESTLE analysis in understanding the business environment and formulating effective strategies for managing business operations. The conclusion underscores the significance of recognizing environmental determinants and their impact on the organization to operate business activities effectively and maintain a competitive edge. The report includes references to academic sources and online resources to support its findings. This report is available on Desklib, a platform offering students access to study tools and resources, including past papers and assignment solutions.

Mercedes

Table of Contents
INTRODUCTION.......................................................................................................................................3
PESTLE ANALYSIS..............................................................................................................................3
Impact on business performance due to changes in external environmental factors................................4
CONCLUSION...........................................................................................................................................4
REFERENCE..............................................................................................................................................5

INTRODUCTION
Business environmental factors impacts on performance of organization. In this regard,
different components are analyzed through different tools such as SWOT and PESTLE analysis.
The present report is based on understanding PESTLE analysis elements of Mercedes. It is one
of the wide spread automotive industry’s entity that provides automobiles, luxury vehicles and
several services to million consumers. Various macro environmental elements and impact on
firm due to changes in those components can be determined through this study.
PESTLE ANALYSIS
Under PESTLE analysis, different external environmental factors are determined as
political, socio-cultural, economic, legal, technological and environmental. These are
uncontrollable factors and changes in these components impact on organization’s business
activities (Singaram, Kraaijenbrink and Mols, 2016). In accordance to this, political
environmental factors involve government policies regarding tax, interest and foreign trade.
Therefore, fluctuations in these tax and interest rates affect financial position of Mercedes
(Merecedes, 2016). In this process, increasing in tax and interest rates affects economic condition
of organization negatively. While, decreasing in interest rates increases profit earning capacity of
firm.
However, changes in customers’ lifestyles and different choices productivity and profitability of
firm get impacted. It comes under socio-cultural factors of external components that affect
organization’s effectiveness in positive and negative aspects. Including this, economic factors of
business environment include market structure and various components that are related to
demand and production level of goods of firm (Cavico and et.al., 2014). Along with this,
changes in technologies in prospective of better quality of products and adopting changes affects
business as well competitive strategies of firm. It is interrelated with consumer choice and
attitude towards goods and services provided by Mercedes. Apart from this, fluctuations in legal
forms and various obligations in government policies related to public welfare interlinked with
business operations. In addition, there are uncertain dynamics occur at workplace that comes
under environmental components of organization. Hence, there are several macro environmental
factors obtained that affects business activities of firm.

Impact on business performance due to changes in external environmental factors
PESTLE analysis is composition of various external environmental components that is
useful for determining business performance. In accordance to this, business operations and
activities get affected due to flexible changes in environmental components (Halpin and Biggs,
2014). It represents economic structure and different activities that provided by Mercedes. Thus,
market position and competitive strategy get impacted. Moreover, it is required to prepare
strategies and action plans for creating effective balance and proper management of business
operations produces by organization. Therefore, fluctuations in macro environmental factors of
business entity affect performance and different activities of entity.
CONCLUSION
The report is concluded that PESTLE analysis is essential to identify organization’s
performance and different business activities. In this way, different macro environmental factors
are determined that affect Mercedes’ efficiency. Including this, due to fluctuations in
environmental components affect over organizational structure is considered. However, through
this study, significance of analysis is recognized to operate business activities effectively is
presented. Thus, several environmental determinants and impact on business organization is
determined. Including this, business and competitive strategies of firm is recognized due to
changes in these components.

REFERENCE
Books and Journals
Singaram, R., Kraaijenbrink, J. and Mols, N., 2016, January. Cognitive Legitimacy of Social
Business Ventures: An Analysis of Business Plans. In Academy of Management Proceedings.
89(6). Pp.17-19.
Halpin, A.L. and Biggs, W.D., 2014. Evaluating business plans in a simulation
environment. Developments in Business Simulation and Experiential Learning. 37(6). Pp.98-99.
Cavico, F.J and et.al., 2014. Business Plans as Legally Protected Trade Secrets under the
Uniform Trade Secrets Act. Journal of Business Studies Quarterly. 6(2). pp.42.
Online
Merecedes. 2016. [Online]. Available through: <www.mercedes-benz.uk.com>. [Accessed on 11th March
2017].