In this essay, we will conduct a PESTEL analysis of the chocolate industry in the UK to identify the key external factors that could affect its future prospects. Opening shop in the early 19 th century, Cadbury has emerged as a global brand with factories and offices the United Kingdom and North America, and a notable presence in Asia and Africa as well. Sales were down only slightly, and the CEO John Bilbrey, as well as CFO Patricia Little, blamed everything for it. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of The Hershey Company. This means less error in product development and packaging, possibly saving the company millions in expenses and product waste. Foreign currency exchange rates were insignificant in the second quarter. 2012). Market Overview 2023-2028: The India chocolate market size reached US$ 2.4 Billion in 2022. The Brazilian chocolate market is projected to witness a CAGR of 4.12% during the forecast period 2022-2027. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Chocolate Gourmet shouldnt be worried about the monopoly and restrictive trade practices law. In-depth industry statistics and market share insights of the Chocolate Market sector for 2020, 2021, and 2022. Yasemin Oraman. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Chocolate Hawkins shouldnt be worried about the monopoly and restrictive trade practices law. The chocolate industry has to anticipate the outcomes of their business operations in such a way that are in abidance with the rules and regulations made by the government of the country. Political factors: Government policies and regulations can have a significant impact on the confectionery industry. According to an estimate, her annual GDP was 1.375 trillion US dollars in 2020. Trade policies and agreements, such as those related to tariffs and quotas on imported ingredients or finished products. For launching a new product we use PESTLE or SWOT strategies and let us Consider that we are launching a new chocolate product . At EMBA PRO, The next element to address in the PESTEL analysis of Switzerland is the economic environment. Hawkins wondered how to guide his company into this new area of social gaming without losing any of the tremendous creative momentum the team had built over the previous years. The PEST analysis looks at four types of external environmental elements: P -Political factors in an economy include various forms of government intervention and political lobbying, such as . On the other hand, Nestle has a better record of recycling. This can help Chocolate Hawkins in numerous decisions such as plant location, product development, and pricing strategy. In 2015, the company blamed American consumers for not buying more chocolate. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand. Dec 31, 2014 by PESTLEanalysis Contributor Cadbury is synonymous with chocolate consumption worldwide. Lindt PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Chocolate Gourmet should be careful about the history of forex risk before entering new market. . 2. Recent moves in this regard include the use of pathogen testing systems and filing patents for heat-resistant chocolate. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. The retail distribution of take-home and eat-later confectionery is basically done through two groups of channels, i.e. KitKat PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Chocolate industry Presentation 1. It can enable Chocolate Hawkins to hire skilled workforce at competitive salaries. When too heavy, additional ingredients go to waste. In 2000, 81% of U.S. adults consumed chocolate. Published by HBR Publications. Managers at Chocolate Hawkins need to examine three inter-related environments in order to come up with an effective strategy. Expert Solution. Chocolate Hawkins should build a strategy that can integrate societal values, infrastructure, and Chocolate Hawkins business model. Restructuring of the European chocolate industry and its impact on cocoa production in West Africa. The UK chocolate market is the biggest in all European market. Definition of PESTEL / PEST / STEP Analysis. Chocolate Industry 5. PEST ANALYSIS The PEST analysis is a useful tool for understanding market growth or decline and as such the position potential and direction for a business. - Types of Immigration & Attitude towards Immigrants Given the latest developments such as Brexit and Immigrant detention on Southern border of United States. -Kew raw materials are sourced from local suppliers. Some of the legal factors that may impact the chocolate industry in the UK include: Some environmental factors that may affect the chocolate industry in the UK include climate change and its impact on cocoa production, deforestation and habitat destruction in cocoa-growing regions, resource consumption and waste generation in the manufacturing process, and the environmental impact of packaging and transportation. Many US companies have incurred losses in Mexico in regular forex crisis in that country. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of Rocky Mountain Chocolate Factory, Inc.. The company has attempted to make amends by creating socially-conscious programs to help children in need. - Employment Rate If the employment rate is high then it will impact Chocolate Gourmet strategies in two ways it will provide enough customers for Chocolate Gourmet products, and secondly it will make it expensive for Chocolate Gourmet to hire talented & skillful employees. Business Analysis: Kirkland. The snapshot of this . One way to start is by closely mapping the changes in consumer buying behavior and emerging value proposition. The implication for Chocolate Gourmet is that it can boost sales of its product in short run but also expose Chocolate Gourmet to medium term forex and currency depreciation risks. Published by HBR Publications. For internal factors, check out the swot analysis of the UK. - E-Commerce & Related Infrastructure Development As E-Commerce is critical for Chocolate Hawkins business model. 4. Definition of PESTEL / PEST / STEP Analysis. - Level of Household Income and Savings Rate Increasing consumption and stagnant household income in United States had led to credit binge consumption. As population is ageing it will require less tech intensive products. By last estimates, the 8 Cadbury factories in the UK had employed 3,000 workers. Execution of the strategy and building a feedback loop, using which managers at Chocolate Gourmet can fine tune processes and strategies going forward. The top corporate tax rates are . In fact, Cadbury was able to gain a 30% increase in its annual profits, predominantly from the sales of Dairy Milk and Trident. The conditions of a country affect the businesses within it, and PESTLE analysis helps these businesses understand the possible effects . - Time Taken for Court Proceedings Even if the country has best of the laws, it doesnt mean much if they cant be enforced in a timely manner. You can download Excel Template of PESTEL / PEST / STEP Analysis & Solution of Note on the U.S. Chocolate Market, Copyright Executive MBA Pro Resources 2022, BCG Matrix / Growth Share Matrix Analysis, Case Study Solution & Analysis of Note on the U.S. Chocolate Market, SWOT Analysis of Note on the U.S. Chocolate Market, 5C Marketing Analysis of Note on the U.S. Chocolate Market, 4P Marketing Analysis of Note on the U.S. Chocolate Market, Porter Five Forces Analysis and Solution of Note on the U.S. Chocolate Market, Porter Value Chain Analysis and Solution of Note on the U.S. Chocolate Market, Case Memo & Recommendation Memo of Note on the U.S. Chocolate Market, Blue Ocean Analysis and Solution of Note on the U.S. Chocolate Market, Marketing Strategy and Analysis Note on the U.S. Chocolate Market, VRIO /VRIN Analysis & Solution of Note on the U.S. Chocolate Market, PESTEL / STEP / PEST Analysis of Note on the U.S. Chocolate Market, Case Study Solution of Note on the U.S. Chocolate Market, SWOT Analysis and Solution of Note on the U.S. Chocolate Market, Kirin Brewery Co., Ltd.: The Dry Beer War PESTEL / PEST / STEP Analysis & Solution, Monsanto and Genetically Modified Organisms PESTEL / PEST / STEP Analysis & Solution, Cola Wars Continue: Coke and Pepsi in 2006 PESTEL / PEST / STEP Analysis & Solution, Bitter Competition: The Holland Sweetener Co. vs. NutraSweet (G) PESTEL / PEST / STEP Analysis & Solution, Coca-Cola FEMSA's Contribution to Peace PESTEL / PEST / STEP Analysis & Solution, Vincor and the New World of Wine PESTEL / PEST / STEP Analysis & Solution, Arcor: Global Strategy and Local Turbulence (Abridged) PESTEL / PEST / STEP Analysis & Solution, Marks and Spencer Ltd. (A) PESTEL / PEST / STEP Analysis & Solution, PepsiCo: The Challenge of Growth Through Innovation PESTEL / PEST / STEP Analysis & Solution, Adam Baxter Co./Local 190: 1985 Negotiation, Local 190 Confidential Information PESTEL / PEST / STEP Analysis & Solution. With almost 1.4 billion Chinese inhabitants and a growing middle-class, it is a wonderful opportunity for brands to conquer and retain a wide audience. The Hersheys Company is the largest chocolate manufacturer in North America and yet theyve hit major setbacks both politically and economically. Cadbury is a well-known producer and distributor of chocolate and milk-based products. Chocolate consumption in India is low per capita consumption in urban India is estimated Mostly the unusual macroeconomic winds and generic challenges caused sales problems. Analyze the Chocolate Hawkins external competitive environment to identify opportunities and threats. Packaging: There is a growing demand for sustainable and eco-friendly packaging solutions, which has led to the development of new technology for biodegradable or compostable packaging materials. Journal of Economic Geography, 1 (4), pp.405 Norton, Marcy. Experience economy is one of the fastest growing segments both among millennials and among baby-boomers. The remaining 35% of the chocolate industry was divided among Bourbon Corporation, Nestle S.A., Morinaga & Co, Fujiya, Kabaya Foods Corporation, and Cadbury. - Consumer Protection Laws Chocolate Hawkins needs to know what are the consumer laws, what is the rate of enforcement, what is the attitude of authorities towards consumer protection laws, and what is the role activist groups in enforcement of consumer protection laws. Chocolate Mould Market Share, Size Global Growth Analysis, Trends, Industry Analysis, Key Players and Value,Opportunity Forecast to 2025 Posted o. Wednesday, 01 March 2023 08:34 GMT. Global Chocolate Market - offers growth, outlook, trends, shares, Industry Analysis, opportunities, Key Players Forecast 2019 to 2025 IND: (+91) 949418 5556 , USA: (+1) 408-915-5456 sales@envisioninteligence.com PESTEL analysis is mainly the assessment of macro environment factors. Sample Complete Report This is the sample complete report which will give you a glimpse of what your complete report will cover after purchase. - Likelihood of Entering into an Armed Conflict From the information in the Digital Chocolate case study, I dont think there is a likelihood of country entering into an armed conflict with a neighboring country. Kurien, the cooperative society makes milk and various milk products like curd, cheese, milk powder, cheese spread and chocolate amongst others. The first Cadbury shop was opened in . It first sold its items in United States in 1905. 4. - Price Fluctuations in both Local and International Markets Compare to the level of quantitative easing in last decade the prices of Chocolate Gourmet products and prices of overall products have remained sticky in the US market. It has decimated the culture of savings as people dont have enough to save. The PEST Analysis is quite similar to that of the SWOT analysis (Srdjevic et al. Political environment and other factors not only impact the cost of doing business but also long term sustainability. PESTLE Analysis for Cannabis Startups PESTLE is the acronym for a framework which analyzes the Political, Economic, Social, Technological, Legislative, and Environmental (mostly in the ecological sense) factors that have direct and indirect impacts on a business. Over one hundred million residents live in Japan and are forced to live in specific locations. Then with the blame game where everything was the culprit for poor sales in 2015. Demographics: The UK has an aging population, which may impact chocolate consumption patterns as older consumers may be less likely to consume chocolate or may have different preferences than younger consumers. Pestle Analysis Of Cadbury 1585 Words7 Pages Cadbury is a multinational organization. U.S. retail chocolate sales were forecast to grow to $14.5 billion in 2007. To them, Americans have the luxury of buying several premium chocolates. - Immigration Policies and Level of Immigration What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. The government of each party has adhered to the treaties done by previous governments, so there is a consistency in both rule of law and regulations. - Immigration Policies and Level of Immigration What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. Cadbury is synonymous with chocolate consumption worldwide. Social factors such as demography trends, power structure in the society, women participation in workforce etc have immense impact over not only the country's economy but also on workforce talent availability and level of consumer demand. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. The market size for Switzerland Chocolate in 2021 was estimated at around USD 1.63 Bn. GDP of Afghanistan in 2019 was 19,101 billion $. Chocolate Hawkins should carefully analyze the attitude towards authority before launching a marketing campaign for its products and services. - Recycle Policies What are the recycle policies in prospective market and how Chocolate Gourmet can adhere to those policies. (Child Labor and Slavery in the Chocolate Industry, 2014). Chocolate Gourmet can borrow cheaply under such circumstances. Different countries have different attitude towards health and safety so it is better for Chocolate Gourmet to conduct a thorough research before entering the market. - Employment Laws What are the employment laws in the country and are they consistent with the business model of Chocolate Hawkins. 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Some social factors that may affect the chocolate industry in the UK include: Changing consumer preferences: Consumers in the UK are becoming more health-conscious and may seek out lower-calorie or healthier chocolate products. An Analytic Study of Organic Food Industry as Part of Healthy Eating Habit in Turkey: Market Growth, Challenges and Prospects. 2006. In each of these locations, the sales were weaker. They include political policies and stability as well as trade, taxation and fiscal policies ". Australia is one of the world's most advanced developed countries mainly because of the economical strengths. 1 . Here's the SWOT analysis of Mars Incorporated which is an American multinational company primarily engaged in production and marketing of confectionery. Higher inflation may require Chocolate Hawkins to continuously increase prices in line of inflation which could lead to lower levels brand loyalty and constant endeavors to manage costs. SWOT analysis of Cadbury 12. For example Trump not standing by US commitments created an environment of uncertainty. - Attitude towards Health & Safety The attitude towards health and safety is often reflected in the quality of the products and cost structures of manufacturing processes. The gender composition of labor market is a good indicator of disposal income of household, priorities of the households, and related needs. It requires less temperature and energy to produce (unlike non-raw chocolate), and thatll also bring a smile to the faces of eco-friendly consumers. - Time Taken for Court Proceedings Even if the country has best of the laws, it doesnt mean much if they cant be enforced in a timely manner. These factors are Political, Legal, Economic and Social. They also have the Nourishing Minds program, designed to provide children with basic nutritional needs. And even before that in 2007, Cadbury Schweppes decided to outsource a major portion of its accounting and HR to an Indian firm in the face of increasing operational expenses and reducing margins. It is written by Glenn Carroll, Greg Powell and shed light on critical areas in field of Strategy & Execution, Entrepreneurship, Strategy that the protagonist in the case study is facing. Although the company is clearly attempting to bring social good into the world, it doesnt stop them from blaming consumers when sales are declining. Glenn Carroll, Greg Powell (2018), "Note on the U.S. Chocolate Market Harvard Business Review Case Study. Today, Kirkland's main sales support center is located in Brentwood, Tennessee which supports 337 stores in 35 states. - GDP Trend & Rate of Economic Growth The higher GDP growth rate signals growing demand in the economy. - Influence of Climate Change How climate change will impact Chocolate Gourmet business model and supply chain. Chocolate Hawkins should be careful about the history of forex risk before entering new market. - Intellectual Property Rights Protection Chocolate Gourmet should assess the level of protection that intellectual property rights get under the legal system of the country. it can be said that PESTEL analysis is a useful framework to understand the external environment in which an organization operates. Luckily for the company, things turned around in the first two quarters of 2018. He introduced the framework back in 1964 in his book " Scanning the Business Environment ". According to the date compiled by CNN Money, the Philippines is projected to be the fourth fastest in the world, that has a GDP at 6.7%. All of this is rudimentary and basic, but playing the blame game doesnt leave a savory taste in consumers mouths. - Segregation of Political Responsibilities between Different Government Agencies There are numerous government agencies which reduces the risk of overwhelming pressure by one agency. Its GDP in 2019 was $703.8 billion that represented 0.58% of the world economy (Trading Economics, 2020). It is also imperative to use technology to create competitive advantage in the industry. For example as the population of USA and EU is growing old the demand for products mostly catering to this segment will grow. If youve ever enjoyed the classic Hersheys, Kit Kat, or Reeses Peanut Butter Cups, then youve been a consumer of the Hersheys Company. Due to the COVID-19 pandemic, the global Insulin Delivery Devices market size is estimated to be worth USD 11340 million in 2022 and is forecast to a readjusted size of USD 14100 million by 2028 . Tax rates were also terrible, according to Mr. Bilbrey. Cadbury is identical with the consumption of chocolate on a universal basis. In 2009, Hawkins was eager for Digital Chocolate to start developing new types of mobile games that could be played by multiple players over a period of time. However, the stringent restrictions on the entry of skilled workers from rest of Europe can affect Cadburys hiring decisions in the future. Due to favourable political factors, Amul company achieved a growth of 11.35% in its operating units in Kolkata, Pune and Mumbai. Chocolate Gourmet should carefully analyze the attitude towards authority before launching a marketing campaign for its products and services. As such, theyre looking to bring more good into the world by building thriving communities and becoming better stewards of the planet. A SWOT analysis of handbags, A SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis is a strategic planning tool used to evaluate the internal and external factors that can impact the success, Your email address will not be published. Chocolate Hawkins can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. 3. Cultural norms: Chocolate is often associated with indulgence and gift-giving in UK culture, which may impact consumption patterns and marketing strategies. PESTEL analysis is mainly the assessment of macro environment factors. - Focus & Spending on Renewable Technologies How much of the budget is spend on renewable energy sources and how Chocolate Gourmet can make this investment as part of its competitive strategy. Hersheys has dedicated commitments in social responsibility. Japan is a small, but articulate, country. 5. Chocolate Gourmet should have capabilities to navigate under this hyper sensitive environment. Solutions. PESTLE Analysis of Soap Industry in India, PESTEL Analysis of Starbucks in Philippines. But this strategy entails risks when interest rate will go up. Net sales ($1,751.6 million) were an increase of 5.3 percent. Raw material prices: Fluctuations in the prices of cocoa, sugar, and other ingredients can affect the cost of production and ultimately the price of chocolate products. Chocolate Hawkins can make strategies based on the stable political environment. PESTLE stands for: P - Political. - Attitude towards Authority Various cultures in different part of the world have different attitude towards authority. This PEST analysis of the Hershey Company examines these issues, as well as their relationship with consumers and the use of cutting-edge technology. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. "Tasting Empire: Chocolate and the European Internalization of Mesoamerican Aesthetics." The American Historical Review 111 (3):pp 660 Odijie, E.M., 2016. PESTLE analysis of chocolate industry in JAPAN. Hence, Cadbury and its range of products are now owned by the American confectionary giant. Digital Chocolate case study (referred as Chocolate Hawkins for purpose of this article) is a Harvard Business School (HBR) case study covering topics such as Organizational Development and strategic management.
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