Pestle Analysis Starbucks

In: Business and Management

Submitted By ariezols
Words 2320
Pages 10
PESTLE Analysis: PESTLE analysis is a tool that can aid organisations making strategies by helping
them understand the external environment in which they operate now and will operate
in the future. It is a method of examining the many different external factors affecting an organisation - the outside influences on success or failure
The PESTLE analysis will be used to identify and understand the important factors Starbucks must consider in all areas of the business.
Political:
* Taxation policy - high taxation imposed on farmers in those countries producing the coffee bean will usually mean Starbucks pay a higher price for the coffee they purchase. Any fluctuations in taxation levels in the industry are almost certainly ultimately passed on to the consumer. Recently (June 13, 2003) Tanzania's Minister of Finance harmonized and rationalized local government taxation to boost rural productivity of the coffee bean. Tax was lowered for these 'small holder' farmers and this saving will have been passed on to purchasers of coffee like Starbucks.
* Deregulation - A decade ago, the USA pulled out of the ICA (international Coffee Agreement) that set export quotas for producing nations and kept the price of coffee fairly stable. Coffee quotas and price controls ended. Since the deregulation farmers have suffered and their earnings have dropped. Many have struggled to make a living so have given up.
* International trade regulations/tariffs - Trade issues will affect Starbucks predominantly when exporting and importing goods. When another country's government imposes a tariff it not only results in an efficiency loss for Starbucks but large income transfers can become inconsistent with equity. This extra charge can turn a bargain into a rip-off. Also, since 9/11, trade relations have been adversely affected between the USA and some other countries.
* Government stability -…...

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