Environmental Variables: Strategic Analysis of Piñatex™ in NZ

This report conducts a strategic analysis of the environmental variables in New Zealand to assess the market potential for Piñatex™, a vegan leather product. It examines political factors, including government stability and labor laws, and economic factors such as per capita income, consumer behavior, and unemployment rates. The analysis also explores environmental factors, emphasizing New Zealand's ecological awareness and pineapple harvesting. Social factors, including tourism and trade, are considered alongside technological advancements and legal frameworks. The report concludes that while challenges exist, New Zealand presents a promising market for Piñatex™ due to its environmentally conscious population, favorable economic conditions, and technological advancements.

Running head: STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Strategic Analysis of the Environmental Variables: Piñatex™ in New Zealand
Student Name
University name
Author Name

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Executive summary
The report tries to investigate various environmental factors of New Zealand for Pinatex to build
a new business. The initial part of the report explores the product and the manufacturing
company in order to understand its potential as a successful international business. Pinatex is a
unique product based on ‘vegan leather’ which possesses great potential in the leather market.
The political, social, technological, economic, environmental and legal factors have been
investigated in detail so that the possible risks or profit areas can be identified. Few factors work
well in favor of the company, however factors like legal and economy may create some
challenges for the company to business smoothly. The investigation demonstrates that New
Zealand has a great potential market for Pinatex.

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Table of Contents
Introduction......................................................................................................................................3
Background......................................................................................................................................3
The Variables...................................................................................................................................4
Political Factors...........................................................................................................................4
Economic factors.........................................................................................................................5
Environmental factors..................................................................................................................6
Social Factors...............................................................................................................................6
Technological factors...................................................................................................................7
Legal............................................................................................................................................7
Conclusion.......................................................................................................................................8
Reference.........................................................................................................................................9

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Introduction
The Pinatex is a revolutionary textile product, developed by Ananas Anam based on
sustainable and natural product. The plant fibres are used to create the natural textile and the
research took over seven years to produce an effective and innovative product. Originally
developed in Philippines and now the business is based out of United Kingdom and Spain
(Ananas-anam.com, 2017). Ananas Anam is trying to expand their business internationally in
many other countries. This report tries to explore the environmental variables in New Zealand so
that the company identifies the positive and negative aspects of the market before starting the
business.
Background
Pinatex is manufactured and developed by the new material manufacturing company
Ananas Anam (Ananas-anam.com, 2017). The idea was developed by Dr Carmen Hijosa. The
pineapple fibres provide the raw material for producing the product (Boateng, Aidoo-Taylor &
Archer, 2016). The company aims to develop a unique textile industry that promotes the
ecological, social and cultural development. The company also desires to make the local farmers
gain economic profit by engaging in the production. The company has been searching for its
potential international markets in other countries. The management has come up with few
suggestions however the research department has engaged in effective market analysis of the
environmental factors (Eva et al., 2014).

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
The Variables
Political Factors
Amongst the macro-environmental factors, one of the most significant factors is the
political factor which has the higher chances of affecting the trade policies, legal rules and
regulation and the other government legislation. If the country has a stable government, there are
fewer chances of risks for any organization to do business in the country as the legal rules and
regulations are not expected to be changes within a short span of time (Holder, Frew & Van
Hale, 2015). However in terms of New Zealand, the chances are higher in every three years, as
the government changes the rules after the span of three years. Mostly the left leaned Labor Party
and the conservative National Party has dominated the political scenario of New Zealand. Each
of the parties have implemented a vast range of economic and social legislation, long scale work
programs and social safety programs. Therefore, for the fashion industry, this change of rules
and regulation can be effective for two primary reasons. When Piñatex™ enters the market, it
can be highly possible that the rules are regulations are not in the favor of the organization;
however, the regulation can change to the favor of the organization within the span of three
years. However, the labor costs in New Zealand is higher, therefore the organization can face
issues with the cost of the production. The labor laws are strict as well (Meurk, Sullivan &
McWilliam, 2016). However there is another perspective regarding the labor law and the costs,
as the productivity of the labor are higher in the country than any other country with lower labor
costs. Therefore Piñatex™ can have labors with more productivity even if they have to spend
higher costs for them. Moreover, the organization requires having a huge amount of money

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
before they start their business in the country. Along with that, the lending rates are higher in
New Zealand, therefore Piñatex™ has to pay more interest, and therefore it reduces their profit to
a great extent. According to Smith and Finn (2015) the trade freedom in New Zealand is 84.6%,
whereas the business freedom is 99.9%, so these figures also indicate that the country has a
better environment for doing trading and business.
Economic factors
Economic factors New Zealand have great economic growth. The per capita income is
better than a lot other companies in comparison (OECD, 2017). There is always a demand for
new products among the citizens. The consumer behavior of the citizens is quite favorable for a
new product in the market (Nielsen.com, 2015). Most people can afford products of various price
ranges. The money circulation is in continuous flow as the purchasing of necessary or luxurious
products is continuous. The unemployment rate of New Zealand is low which represents the
country’s positive economic growth in present and in the future (Stats.govt.nz, 2017). The
inflation rate is also low which can be helpful for Pinatex’s entry in the country. The company
can find labor, iron and other necessary resources from the country easily. So if Pinatex opens up
a business in New Zealand, there are high chances that the company will generate high revenue.
The economic growth of the company is based on the external – internal demand,
investment and consumption expenditure that are acting positively for the country’s economy.
The country’s economy is extremely dependent on trading with other countries, so the business
for Pinatex has a good potential market in the country. The external demand by other companies
can affect the company’s economic condition so Pinatex has to do the necessary market research
on other external business organizations and implement effective strategies for the competitors.
New Zealand does not invest much on the research and development so that it makes it

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
dependent on other countries for acquiring newer technologies (Jaffe & Le, 2015). The company
can utilize this opportunity to makes its strong presence in the country’s market. The favorable
political and business climate influences large foreign direct investment in the country.
Environmental factors
New Zealand is famous for its ecological system. The average population educated and
they value the environment. The pineapple harvesting in New Zealand is getting popular every
day. Though majority of the pineapple are still exported from Fiji, but Pinatex manufacturing can
help significantly for improving the pineapple harvesting in the country (Gilbert, 2013). As the
citizens are environmentally aware, there is a high chance for the ‘vegan lather’ to have great
demand in the local market (Cowart, 2016). The population and the government have
implemented advanced technologies in order to recycle the garbage and take extreme precautions
to protect the environment from the pollution. The government act actively in taking fresh and
new initiatives to improve the environmental condition of the country.
Social Factors
The economy of New Zealand is highly dependent on the tourism and trade with other
countries. The external demand is higher in the country; therefore the economical situation of the
country is highly influenced by such demands. The social classification of New Zealand is
wonderful and the country has an open mind set in terms of trading with other countries. Within
the fashion industry, there is a consistent demand which can be very much helpful for Piñatex™
while setting up a new and innovative business in the country. The banking system in the country
is stable and strong therefore it also welcomes the FDI or the foreign direct investment within the
country. The 100% literacy rate and higher life expectancy rate which is 81, indicate that the
people have good health and they are fashionable to accept an innovative business in New

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Zealand. As the government put higher emphasis on tourism, it provides more facilities for the
tourists; therefore it would be beneficial for Piñatex™ if they set up their business in the country,
as they can also get hold of the global market.
Technological factors
The students in New Zealand are performing really well by actively engaging themselves
in effective science or mathematics programs (Oecd.org, 2014). The country has been making
great technological advancements in various sectors. The use of internet in urban and rural area
of the country is really high. The new company can access the internet for data collection even in
remote areas. As the manufacturing of vegan leather is related to harvesting, it is possible the
company will start business in remote areas, but it does not have to suffer for lack of internet
accessibility. Various phone companies are investing a lot of money for improving the business.
They offer a lot of services in affordable rates to the local people and companies. The local
people are provided various technological supports by the government.
Legal
The government has taken various legal actions in order to protect the company and the
individual well being. They implement new rules and regulations to lower the crime. The law is
in favor of the international business as they welcome the businesses actively. However the
international organizations have to pay high lending charges to the government for starting a new
business (Asb.co.nz, 2017). So the companies may lack in gaining much profit but company
must invest there as the good relationship with the government will ensure a profitable business
for the company in the longer run.

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Conclusion
The Pinatex is a revolutionary new product in the market, so it has high potential to profit
significantly. By examining such environmental factors like political, technological, economic,
social and legal it has been experienced that the country proves to be a great potential market for
the company. However, there are few challenges that the new company might face related to
legal fees or harvesting cost, but if the company invests enough money in the initial phase, the
company has good future to gain huge financial profit.

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Reference
Boateng, K. B., Aidoo-Taylor, B., & Archer, S. (2016). Experimenting the Feasibility of Banana
Stalk for Practical Textile. Chinese Business Review, 15(8), 388-399.
Cowart, K. (2016). Vegan Leather is Now a Thing, And You Won’t Believe What it is Made Out
Of!. The Mind Unleashed. Retrieved 27 August 2017, from
http://themindunleashed.com/2016/03/vegan-leather-is-now-a-thing-and-you-wont-
believe-what-it-is-made-out-of.html
Education at a Glance: OECD. (2014). Oecd.org. Retrieved 27 August 2017, from
https://www.oecd.org/newzealand/New%20Zealand-EAG2014-Country-Note.pdf
Employment and unemployment. (2017). Stats.govt.nz. Retrieved 27 August 2017, from
http://www.stats.govt.nz/browse_for_stats/income-and-work/employment_and_unemplo
yment.aspx
Eva, M., Hindle, K., Paul, D., Rollaston, C., & Tudor, D. (2014). Business analysis. BCS.
Gilbert, M., Rickards-Rees, C., Spicer, N., & Coates, B. (2013). sustainable development in the
pacific and the role of the New Zealand private sector(pp. 38-39). Oxfam Research
Report-March 2013, Oxfam, Auckland.
Holder, P. W., Frew, R., & Van Hale, R. (2015). The geographic origin of an intercepted
biosecurity pest beetle assigned using hydrogen stable isotopes. Journal of economic
entomology, 108(2), 834-837.

STRATEGIC ANALYSIS OF THE ENVIRONMENTAL VARIABLES
Introducing Piñatex™ - ananas anam. (2017). ananas anam. Retrieved 27 August 2017, from
http://www.ananas-anam.com/pinatex/
Jaffe, A. B., & Le, T. (2015). The impact of R&D subsidy on innovation: a study of New Zealand
firms (No. w21479). National Bureau of Economic Research.
Kelsey, J. (2015). Reclaiming the future: New Zealand and the global economy. Bridget
Williams Books.
Meurk, C. D., Sullivan, J., & McWilliam, W. (2016). Vegetation History and Dynamics in New
Zealand: Future Scenarios and Improved Trajectories Towards Restoring Natural
Patterns. In Vegetation Structure and Function at Multiple Spatial, Temporal and
Conceptual Scales (pp. 517-528). Springer International Publishing.
New Zealand - OECD Data. (2017). theOECD. Retrieved 27 August 2017, from
https://data.oecd.org/new-zealand.htm
Rates and fees | ASB. (2017). ASB Bank. Retrieved 27 August 2017, from
https://www.asb.co.nz/rates-and-fees
Smith, A., & Finn, A. (2015). Built for niche: Rethinking the role of manufacturing in
developing designer fashion in New Zealand. International Journal of Fashion
Studies, 2(1), 29-42.
The Changing NZ Consumer. (2015). Nielsen.com. Retrieved 27 August 2017, from
http://www.nielsen.com/nz/en/insights/news/2015/the-changing-nz-consumer.html