Case Study: Royal Mail Group's Strategic Analysis Using PESTLE & SWOT

This case study provides a PESTLE and SWOT analysis of the Royal Mail Group, a UK-based organization. The PESTLE analysis examines the political, economic, social, technological, legal, and environmental factors impacting the company. The SWOT analysis identifies the company's strengths, weaknesses, opportunities, and threats, including customer satisfaction, challenges from new market entrants, technological advancements, and competition. The analysis also addresses the company's strategic position, implementation strategies, and key challenges like lower consumer spending and declining annual profits, suggesting potential solutions such as extensive marketing and technological innovation. Desklib provides access to this document along with a wide array of study resources, including past papers and solved assignments, for students.

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 1
ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS
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ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 2
Contents
Introduction....................................................................................................................................3
PESTLE analysis............................................................................................................................3
Political.......................................................................................................................................3
Economic....................................................................................................................................3
Social..........................................................................................................................................4
Technological.............................................................................................................................4
Legal...........................................................................................................................................4
Environmental............................................................................................................................4
SWOT analysis...............................................................................................................................5
Strengths.....................................................................................................................................5
Weaknesses................................................................................................................................5
Opportunities..............................................................................................................................5
Threat.........................................................................................................................................6
Company current strategic position and how strategy can be implemented....................................6
Key challenges, identification and evaluation of option to address one of the challenges..............7
References......................................................................................................................................7

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 3
Introduction
Royal Mail Group is a United Kingdom based organization. Over the years it has
maintained a pre-eminent position by pursuing more rapid growth on delivery of more letters and
parcels to various addresses.
PESTLE analysis
Political
Political factors have impacted the company in several ways. When it comes to political
factors, the United Kingdom is believed to be fail, and politically stable country with various
opportunities for the businesses operating within. The U.K also has a proactive government and
it is split into local and national administrations. However, there are some of the political factors
that have an influence to this company, such as increase and decrease in taxation, and some well-
hidden corruption (Ullar, 2012, P. 66). For instance, adding a risk factor which has led to a
major loss. It has also affected government policies at local to federal level in which royal mail
should be prepared to pack in for international outcomes of politics.
Economic
Another critical factor is economic factor which seem to have an impact on current state
of the economic environment of the company. Although this country is termed as the 5th highest
GDP in the world, and second in Europe, there are various economic factors that are likely to
impact the success of this company. According to Gooberman et al., (2017, P. 56), economic
factors plays a key role in determining the amount of disposable income, which also determine
the rate at which consumers will be willing to purchase a product or service. In this country,
there is a slow recovery from the 2008/2009 economic crisis, which has had a significant impact
on household income.

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 4
Social
Currently there are many social and cultural changes which are taking place in the
country thus having a high level of impact upon the performance of the company in general. The
general aging of the population is seen as both problematic as well as an opportunity for next to
adapt its item for consumption portfolio for the products supplied by company (Ullar, 2012, P.
68). The country has also experienced social unrest because of migration and ethnic groups.
Technological
The invention of new technological developments has transformed the country business
environment. The companies are harvesting the payback of investments in the technology
backbone in order to support its strategic priorities to be able to emerge as winners in parcels,
defend letters and grow in new areas. The country is also associated with quality innovation
skills, a factor which favors this company because it makes it to implement better ways of doing
things.
Legal
Various legal factors in the United Kingdom affect this company in different ways. For
example, there are legal minimum standards which are enforceable in a jurisdiction. Royal Mail
has achieved significant legislative and regulatory milestones since the Postal Services.
Environmental
Physical environment is also a key issue affecting Royal Mail because it must act
responsibly to show its concerns to the surrounding. Environmentally, the United Kingdom is
clean and green and requires all companies to ensure they value environmental conservation in
their operations. The company engages in corporate social responsibilities to ensure the
environment is conserved. It attains this by participating in some of the conservation activities,
programs and ensuring its waste is properly disposed.

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 5
SWOT analysis
Strengths
The company is also said to be leading in terms of High level of customer satisfaction. It
has improved on customer satisfaction due to its dedication to customer relationship. Ullar
(2012, P. 66) affirms that customer satisfaction is one of the important strengths for companies
because it enhances loyalty, competitive advantage and substantial market share.
The company has also established reputation across the country because of its focus to
operate based on customer expectations. According to Baele & Mustchin (2013, P. 292), this
companies strives to ensure it delivers parcels in timely manner and in the right condition, and
this factor has made many people to have a positive perception concerning its operations.
Weaknesses
One of the major weaknesses associated with this company is being unable to address the
challenges presented by the new entrants in the market. This factor has made it to continue
realizing decrease in its market share because some of its consumer have shifted to other firms
that produce similar products.
Another weakness is the need for more investment in new technologies. Although United
Kingdom is one of the technologically developed countries, this company has not fully utilized
automation of most of its processes. For it to succeed in its goal of expanding to diverse
geographies, it must invest more in technology to integrate the processes across the board.
Opportunities
There is great opportunity based on economic uptick and increase in customer spending
for this company to grow. With the great strides being made to attain better economic conditions

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 6
in the country after the great recession of 2009, royal mail has an opportunity to realize high
sales and increase its market share because of increase in consumer spending.
Emergence of new technologies and operating in one of the technologically developed
countries gives this company an opportunity to provide great services to its loyal clients and also
to attract new customers through other value oriented prepositions (Ullar, 2012, P. 66. This
aspect will give it a chance to expand its market share and challenge its competitors.
Threat
One of the key threats facing Royal Mail Group Company is competition. Although this
firm has established reputation across the country, new entrants and existing organizations that
offer similar services are posing threat to its market share (Florian, 2010, P. 64). This companies
are also making the trends in this market to change, hence making Royal Mail Group Company
to realize challenges in using some of its operational strategies.
Another key threat is lack of highly skilled workforce in some of the global markets.
Other threats facing this company comprise of increased trends towards isolationism, lack of
regular and sufficient supply of innovative products, and currency fluctuations in some of the
countries.
Company current strategic position and how strategy can be implemented
The company’s current position is based on becoming one of the best postal service and
courier companies in not only the United Kingdom but also in other countries. Its strategic
position is supported by pillars which may include being brilliant at the basics which is achieved
by obtaining the delivery right first time. The company can implement the strategy by focusing
on an integer of areas to be able to achieve its objectives, giving their clients the right products at
the right prices.

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 7
The strategy can also be implemented through improving their efficiency. The
improvement can be done in order to meet stretching quality of service targets and improving
safety, customer service, quality and productivity across the production through their World
Class Mail programme.
Key challenges, identification and evaluation of option to address one of the challenges
The key challenge Royal Mail is facing is lower consumer spending (15%). According to
Florian (2010, P. 65), consumer spending influences business performance because it is the one
which determine the amount of money a customer wishes to spend on a particular product or
service. When the spending is low, it means companies realizes few purchases and hence impacts
its revenue growth.
Another challenge is decrease in annual profits. Despite the company having an increase
in parcel volumes, it has experienced significant decrease in its annual profits, because of various
factors such as competition, changes in consumer buying behavior, decrease in consumer
spending and so forth (Baele & Mustchin, P. 293). The company is facing competition in direct
delivery from corner to corner of the country and from companies such as TNT Post.
For this company to realize success, it must implement proper strategies to address these
challenges. Decrease in annual profits can be resolved by doing extensive marketing, designing
the services to match customer expectations and using technology and innovation in its
operations. The company can also address this challenge through analyzing the emerging trends
in this sector and working based on the identified changes.

ROYAL MAIL GROUP PESTLE AND SWOT ANALYSIS 8
References
Baele, D & Mustchin, S. (2013). The Bitter Recent History of Employee Involvement at Royal
Mail: An aggressive Management Agenda Versus Resilient Workplace Unionism. Economic and
Industrial Democracy, 35(2), 289-308.
Florian, H. (2010). Economic Diversification: Evidence for the United Kingdom. Journal of
Real Estate Portfolio Management, 16(1), 56-78.
Gooberman, L., Hauptmeier, M., & Heery, E. (2017). A typology of Employers’ Organizations
in the United Kingdom. Economic and Industrial, 56-87.
Ullar, M. S. (2012). Customer Satisfaction, Perceived Service Quality and Mediating Role of
Perceived Value. International Journal of Marketing Studies, 4(1), 66-69.