PEST Analysis of the UK Macro Environment for Entrepreneurship

This report provides a PEST analysis of the UK macro environment, evaluating the political, economic, social, and technological factors impacting businesses and entrepreneurship. It discusses the effects of Brexit and COVID-19 on the UK's GDP, highlighting how entrepreneurs leverage skills to navigate challenges and capitalize on market opportunities. The report also examines social trends, the importance of technology, and their influence on innovation. The analysis emphasizes the role of entrepreneurial skills such as creativity and effective decision-making in achieving success within the UK's dynamic environment. Desklib provides access to similar solved assignments and resources for students.

PEST ANALYSIS ON
THE UK MACRO
ENVIRONMENT

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PEST Analysis ................................................................................................................................3
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
Books and Journals ....................................................................................................................7

INTRODUCTION
Entrepreneurship is a process of starting own business by conducting research about
market. It is seen that, entrepreneurship is ability of converting idea into business opportunity.
Entrepreneur is a person that is creative and capable of starting own business. The individual is
ready to take risk and has motive of earning profit (Maistrello and et.al., 2017). A person who
identifies an existing problem, finds solution to the same and capitalise upon the given
opportunity through the utilization of optimum resources and competencies. It is vital to note that
entrepreneur plays a vital role in economy as by starting business they contribute to GDP of
nation. Entrepreneur makes effective use of technology and provide best products to customers.
They enhance the productivity as well as work in such a manner that is beneficial for society. It
is vital to note that entrepreneur also rises the employment opportunity in the nation. It is seen
that entrepreneurship helps the customers by getting new and innovative product. It also helps in
enhancing living standard. (FACTM, 2018). It is self-employment process that is beneficial for
the growth of nation. There are huge numbers of SME in UK and they provide employment to
around 16 million people in UK (Bouvet and et.al.,2019). There are number of traits that help a
person to become a good entrepreneur such as creative, need for achievement, self-confidence,
innovativeness. Along with that the skills such as self-starter, HR, marketing, finance
management are helpful to become a successful entrepreneur. There are huge number of macro-
economic factors that impact the success and failure of business. In the report, there is discussion
related to Pest analysis of UK.
MAIN BODY
PEST Analysis
It is study of macro-economic factors that impacts the business. An Entrepreneur must
know about political, economic, social and technological factors. Entrepreneur has traits and
skills that help them to achieve success and growth (Ariyanti and Yuniarti, 2020). The discussion
related to PEST analysis of UK is evaluated underneath:
Political Factors
It is important to consider that UK consists of Wales, England, Northern Ireland. UK is
one of the powerful country and has good economy. The democracy is modern and there is

constitutional monarchy (Guo and et.al., 2019). The prime minister is elected for a period of 5
years and he is considered as head of government. It is important to note that there is good
political stability in the country and that is its biggest strength. Due to Brexit there were various
uncertainty as well as political debates in the nation. But Brexit has also opened doors for
various opportunities. Also, due to Brexit there is increase in the crime and violence in the
country. UK has good trade relation with United States as well as other countries.
For example Duncan Bannatyne started own business and grabbed opportunity to enter
the market. Due to Brexit there were rise in issues in UK but good and effective research is
helpful and will help in success of the business. As by conducting proper research of market is
knowledge is analysed. It is beneficial for an entrepreneur to have good research skills as that
will help them to analyse the demand in market and then produce goods and services that will
help them to satisfy customer needs and wants. It is vital to note that despite the condition of
market Duncan Bannatyne started business of selling ice cream through second hand van. The
political condition of UK is also stable and that benefits entrepreneur to start their business in
UK. As well as entrepreneur follow all the rules and regulations that are beneficial for the
company.
Economic Factors
There are various economic factors that have impact on the business such as inflation
rate, interest rate, employment and unemployment rate, demand and supply in market. By
nominal GDP, the United Kingdom sixth largest economy in whole world. The global lock-
downs of 2020 and 2021 imposed great strain on the treasury and ruined a wide range of

enterprises. So, in 2020, the Bank of England will add more £100 billion into the economy
(Zytynska and et.al., 2020). There was reduction in GDP of UK. But then the other businesses
took advantage that enhanced the opportunity of employment. It is seen that in UK. The
unemployment rate was high around 76.1% and was about 3.8% 2019. This clearly shows that
there are various business organisations that are working hard and in such a manner that enhance
the GDP of nation. It is vital to note that every year, the wage grows, which is tremendously
beneficial to low-income individuals. Corporation profits are currently taxed at a rate of 19
percent. It provided £132 billion to the economy in 2019, as per the House of Commons Library
(2021), with London leading the industry from the top (Jerome and et.al., 2019).
For instance, Yogo pink started their own business by analysing the opportunity in
market. The ability to innovate and tolerate stress helps entrepreneur to work upon business idea
and start business. There is risk in starting business when the GDP of nation is less. As well as
spending power of people in the nation is also less. But it is opportunity for them as they grabbed
idea and then started their own business. It is vital to work in an effective manner. It is important
for a business organisation to know the economic condition of the nation and take steps
accordingly that are beneficial for them as well as UK.

Social Factors
UK is big consumer market. The population in UK is around 68 million (Cheng and
et.al., 2017). It is important to note that as per analysis population is expected to reach 74 million
by 2039. It has impact on the health care system as well as labour market as well as the health-
care system. Organizations, on the other hand, have numerous options to meet the requirements
of the elderly population. The educational system in the UK is unique and that is updated
annually with the most latest information. As a result, the British educational system's degrees
are recognised around the world (Tembo and et.al., 2018). The concept of social rank has
historically affected the UK; yet, the population is multicultural. Companies have developed a
range of new products and markets over the years to meet the demand of different people. There
are various prospects that the businesses can investigate. United Kingdom is in top countries that
have educated people. This shows that there are various opportunities for business person in UK.
It is also ranked third among the best countries in the world. It is worth noting, however, that the
expense of life and higher education is rising. As there is effective education system in UK, it
helps in up-building of entrepreneur. It is important to note that the society needs and wants keep
on changing so each and every business has to work upon effectively to attain success and
growth (Gao and et.al., 2020). It is important to note that business should offer variety of goods
that will satisfy multicultural people. The entrepreneur are always supported by society and that
assist them in growing their business.
For example, Alan Sugar analysed business opportunities that were present in the market.
They have good decision making and that was the reason for such a successful business.
Effective decision making skills are important as that helps to analyse the situation of
environment and take correct decision. An entrepreneur must have good decision making skills
for growth of business. It is vital to note that good marketing skills are also important to promote
the business as well as help them to operate effectively. It is important for individual to develop
skills and traits as that help them to work in an effective manner.
Technological Factors
Technology plays a vital role in success of a business organisation. It is seen that there
are regular update in technology. There are various SME's that work and use technology at their
level best. Also, the organisations that are able to use latest technology are generally successful.
In regard to UK, it is seen that the country spend a lot on research and development. Most

importantly they have world's leading research and development institute (Himanen and et.al.,
2017). The research department try to identify the trends that are present in market. As well as
the barriers are also identified by research department. By conducting proper research
entrepreneurs are able to get more opportunities and innovate the products. It is noticed that the
tech institutes are getting success over Indian, Korean, Japanese, and American institutes (Barnes
and et.al., 2019). This clarify that there is good and effective use of technology.
To illustrate Nicholas John Dale the founder of Oak cash and carry has innovative nature.
Alos, they use latest and innovative technology to provide effective services to customers. They
provide variety of products to customers. An entrepreneur must use latest technology as that help
the organisation to achieve goals and objectives.
Another example is of Dimello coffee house is also a small business started by Mr
Ioannis Iosifidis. They have need for achievement and that was being used by them. They
provide different types of coffee to the customers and that helps them to attract customers. The
entrepreneur must have ability and desire to achieve success (Dalal and et.al.,2020). Due to these
sills the entrepreneur is able to achieve goals and objectives. All the entrepreneur are different
from one another. These traits help them to work in an effective manner. By conducting research
related to latest technology the entrepreneurs are able to attain success and growth. Ioannis
Iosifidis have skills that will help them to start and run business effectively.
There are various factors that impact business. But as discussed above entrepreneur must
skills such as creativity, effective decision making that help them to deal with factors like
political, economic, social and technological to achieve success and operate effectively. It is
essential for entrepreneur to know about all these factors and there influence on business
operations.
CONCLUSION
From the above report, it is analysed that there are various factors that have impact on the
UK. In this report there is discussion related to political factors such as Brexit and Covid-19 on
GDP of UK. It is important to note that entrepreneurs use their skills to work in an effective
manner to achieve success. It is seen that there are more opportunities in the market. The
economic condition of UK is also discussed in report as well as how these entrepreneur grabbed
opportunity and enhanced the demand of their product and service in market. As new business
enhance the employment opportunities in the nation. Along with this, there is discussion related

to social trends and the people that are living in UK. Study related to social factors is helpful. So
as to deal with the challenges and work in an effective manner. In the end there is discussion
related to importance of technology and its use help in bringing innovation.

REFERENCES
Books and Journals
Bouvet and et.al.,2019. Contribution of predation to the biological control of a key herbivorous
pest in citrus agroecosystems. Journal of Animal Ecology, 88(6), pp.915-926.
Cheng and et.al., 2017. Genomic adaptation to polyphagy and insecticides in a major East Asian
noctuid pest. Nature ecology & evolution, 1(11), pp.1747-1756.
Dalal and et.al.,2020. Prey preferences of notonectids towards larval mosquitoes across prey
ontogeny and search area. Pest management science, 76(2), pp.609-616.
Gao and et.al., 2020. A framework for agricultural pest and disease monitoring based on
internet-of-things and unmanned aerial vehicles. Sensors, 20(5), p.1487.
Guo and et.al., 2019. Tree diversity regulates forest pest invasion. Proceedings of the National
Academy of Sciences, 116(15), pp.7382-7386.
Himanen and et.al., 2017. Volatile organic compounds in integrated pest management of
Brassica oilseed crops. Integrated management of insect pests on canola and other
Brassica oilseed crops. CABI Publishing, UK, pp.281-294.
Maistrello and et.al., 2017. Monitoring of the invasive Halyomorpha halys, a new key pest of
fruit orchards in northern Italy. Journal of Pest Science, 90(4), pp.1231-1244.
Tembo and et.al., 2018. Pesticidal plant extracts improve yield and reduce insect pests on legume
crops without harming beneficial arthropods. Frontiers in Plant Science, 9, p.1425.
Zytynska and et.al., 2020. Microbial-mediated plant growth promotion and pest suppression
varies under climate change. Frontiers in plant science, 11, p.1385.