Unilever: PESTLE Analysis of Business Environment and Factors

This report conducts a PESTLE analysis of Unilever's business environment, examining the external factors impacting the company's performance. The analysis covers the competitive environment, including key competitors like P&G and Nestle, as well as the impact of corporate social responsibility and the growing trend of organic and herbal products. The report identifies Unilever's strengths, such as its strong brand image and financial position, and weaknesses, including high product prices. The report emphasizes the importance of understanding both internal and external factors for strategic decision-making, highlighting the need for the company to address its weaknesses and leverage its strengths to gain a competitive advantage. The analysis also considers the influence of technological advancements and environmental factors. The report also explores the need for product development and sustainable business practices.

BUSINESS IN PRACTICE
Introduction
Contemporary business environment contains
various internal and external environmental factors
that create the impact on the productivity and
profitability of an organization. Therefore, it is very
important for the organizations in the current
competitive business environment to analyze their
internal and external factors in order to understand
the profound impact to enhance business turnover.
PESTLE Analysis
The External business environmental factors occurring outside an Unilever
has a major influence on the performance of the business activities and also
has a direct impact on the sustainability of an organization.
• Political
• Economical
• Social
• Technological
• Legal
• Environmental
Impact on external environment
• Competitive environment: In the consumer goods industries the
competition is high big size multinational companies are
competing with each other in order to capture largest market
share.
• Corporate Social Responsibility: By implementing the CSR
governance company like Unilever increases it brand image and
reputation in the market and among consumers.
References:
Abbas, J., 2020. Impact of total quality management on corporate green performance through the mediating role of corporate social
responsibility. Journal of Cleaner Production. 242. p.118458.
Franco, S., 2021. The influence of the external and internal environments of multinational enterprises on the sustainability
commitment of their subsidiaries: A cluster analysis. Journal of Cleaner Production. 297. p.126654.
Conclusion
It is concluded from the above report internal and external factor
analysis using appropriate analytical framework is vital for the business
to analyse its internal strengths and weakness and external
opportunities and threats that are existing in market to compete with
competitors and to gain competitive advantage. It is analysed that the
internal strengths and favourable external environmental factors of the
organisation foster the growth and development whereas the threats,
weaknesses and unfavourable external factors hinders the success of
the organisation.
Strengths Weaknesses
Unilever's strong brand image and
sheer size with 400 different brands is
the major strength that company holds.
The strong financial position is also the
strength of Unilever.
The high prices of the products of
Unilever compared to the competitors
and higher dependency on retail stores
and distributor to sell the products is a
major weakness that company possess.
Opportunities Threats
The growing trend of organic and
herbal products the company has an
opportunity to create product
development there were targeting new
customer base for sustainable
development.
The competitors like P&G, Nestle
threat to company as the increase the
level of substitution for customers that
affects prices of Unilever.