November 2022 | 35 pages | ID: S0B95217862AEN. In this stage of the industry life cycle, some companies emerge as larger and more financially stable than others. Revista ESPACIOS, 39(16). The consumers spending patterns are influenced by their purchasing power of money. These products arent bought by retailers on a whim. The Latest Released Micro EVs market study has evaluated the future growth potential of Global Micro EVs market and provides information and useful stats on market structure and size. Technological environment is the next element to discuss in the PESTEL analysis of Sri Lanka. For example, a supermarket will have a pharmacy, a toy area, a clothing area, etc. Instead, they are owned by small sole proprietors. In that case, you will prefer to go to a grocery store to buy the essential food items so you can prepare dinner as soon as possible. (Ed.). There are almost 40,000 stores in the US that sell groceries. Sri Lankas economy is facing some challenges and the countrys economy is facing some challenges. In 2008 International Conference on Information Management, Innovation Management and Industrial Engineering (Vol. Particularly, Chinese investment has been massive. However, grocery stores are smaller and contain specialized items mainly relevant to food and beverages, while supermarkets are huge and have different departments. The current population of Sri Lanka is just over 21 million (Worldometer, 2021). Academic writing has no room for errors and mistakes. This is costly for the companies. If Cargill A. decides to enter in markets with the corrupt economic, political system, it will threaten the organization's sustainable development by destabilizing the society, harming justice system and endangering the rule of law. The grocery industry hit its maturity stage in the early 1990s. Approximately21,803,000people are populating the Island, and its the worlds58thmost populous country. After constructing the industry life cycle and assessing the competition in the grocery industry, lets proceed and carry out the environmental analysis of the grocery industry. European Journal of Innovation Management, 16(3), 285-300. However, Sri Lanka also faces some environment challenges e.g. Cargill A. should carefully analyze the protests by pressure groups, social/environment activists and worker unions as such protests play an important role in the policy making process. 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Legal is the sixth factor of PESTEL analysis. Daidj, N. Life expectancy is very good as evidenced from the fact that it is 72 years for men, and 78 years for women (BBC, 2019). Grocery stores are one of the sub-sectors of the retail industry, along with six other sub-sectors. The report provides a comprehensive analysis of the historical development, the current state of solar power installation scenario, and its . Stores offering food products must comply with health guidelines proposed by the government. This is why grocery stores in the industry feel threatened. So naturally, this causes rivalry among grocery stores. Social factors: Buying in bulk and collecting endless data. Grocery stores and supermarkets are interchangeable terms. Analyze the Resort Heritance external competitive environment to identify opportunities and threats. 1. High unemployment signals the availability of surplus labor at comparatively lower wages. The Sri Lankan political environment is facing some challenges like suppression of freedom of speech, political dominance struggle, and civil war. Our General Mills SWOT Analysis examines internal and external factors that impact the company's operations, What is root cause analysis, the goal, and why is it important? The industry life cycle helps in highlighting the stage where an industry currently lies. Stores other than CostCo now mass stock various products to avoid running out quickly. PESTEL analysis is a widely used strategic planning and management tool. Which countries are moving up the value added chain away from primary sectors? The National Minimum Wage Act, No. The state of the environment affects the quality of the product and the selection. For instance, people enjoy buying products in bulk. Most companies have a business website. This is the exact premise behind CostCo, a Canadian retailer. Aug-22-2018. The grocery industry currently seems to be in a decline stage since now the demand for the grocery industry has fallen as people have different alternatives such as e-stores and supermarkets. It is important for Cargill A. to understand economic factors such as foreign exchange/interest rate, labor market conditions, inflation and saving rates etc. The retail industry has greatly benefited because of the internet. In fact, Sri Lanka has received the highest investment from China. Sri Lanka PESTEL Analysis - Comprehensive Country Outlook. It doesnt distinguish between local and foreign workers. Weve seen shifts in how eCommerce retail leaders operate over the last few years. We hope the article PESTEL analysis of Sri Lanka has been useful. Copyright 2010-23 Market Research Reports, Inc.. All Rights Reserved. Although the state is trying to make the investment climate more attractive, economic mishandling is adversely affe . However, Condliffe (2019) reports that social media particularly Facebook, have been used to spread false information to bring about social disturbance and disharmony in the country. are considered rare or which species are endangered whose excessive consumption can cause trouble for the organization. The political environment of a country comprises multifaceted factors. Intellectual property regulations are designed to protect the companies' patents and valuable ideas. Powerful Essays. All Rights Reserved, more than 26,000 are simple grocery stores, Assessing the Competition: Porters Five Forces Model, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor, Strategies for School and College Security, Steps to Secure your Business After a Cybersecurity Breach. As does data and copyright laws. of the box and hire Case48 with BIG enough reputation. There are almost 40,000 stores in the US that sell groceries. Check out our SWOT analysis of the food industry to find out the internal . Its basically a digital catalogue for their products. Johnson, G., Whittington, R., Scholes, K., Angwin, D., & Regnr, P. (2011). IFS marks 25th anniversary of the inception of its operations in Sri Lanka as it sees continued success in technology excellence A detailed understanding of the economic environment can help Cargill A. estimate the growth trajectory of industry and organization. There is a growing trend towards the use of green/eco-friendly products. They can easily see which products people are buying, leaning towards, or completely ignoring. academic writing services at least once in their lifetime! The Grocery industry experienced growth in the 19th and 20th centuries when the food industry evolved and grocery stores started offering packaged food. Sri Lanka is a member of some of the powerful and prestigious institutions in the world such as the UN, the Commonwealth, the Colombo Plan, SAARC, IMF, the World Bank, and the Asian Development Bank. Herbal Toothpaste is made of natural ingredients. Back then, the concept of a grocery store was very new, and few grocery stores existed. Cargill A. need to study data protection regulations to protect the customer data. Cargill A. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. It also means having to abide by more economic and political factors. The retail industry is everywhere. The environmental standards, laws and regulations vary across different markets. Companies set targeted ads to customers most likely to visit their stores and buy from them. Its non-negotiable. The presence at international stage increases the companys sensitivity to changes in political environments of different countries. 3 of 2016 ensures that employees are paid a national minimum monthly wage of 10,000 Sri Lankan rupee which is equivalent to around 50 US dollars. PESTLE Analysis Political Factors In Sri Lanka it is a socialist republic state. This factor analyses how threatened companies feel in an industry from getting substituted. This is only possible when the economy is on the rise. take time-critical decisions. This detailed PESTEL analysis of Sri Lanka aims to explore some of the powerful macro factors that impact on Sri Lanka today and may continue doing so in the future. In this way, grocery stores are essential for the economy. Whereas, operating in rigid labor markets may cause labor wage and other issues raised by powerful labor unions. Thats when pre-existing grocery stores started to force the new and not financially strong stores to leave the market so that they could enjoy greater market share. At this stage, the industry is booming and has reached its peak. Each society has distinctive norms and values that play an important role in shaping consumer behavior. After we cleared the difference between the two, we conducted the grocery industry analysis. Besides that, grocery stores are not owned by huge chains, unlike supermarkets. Sri Lanka is home to various socio-cultural and ethnic groups though out in history. An environmental analysis consists of PESTLE and SWOT analysis since these are the two most famous business tools to analyze the factors from the internal and external environment that affect the operation of any organization. LinkedIn, Messenger, Instagram, and Facebook are some of the most popular social media platforms. Some of the things that are the center of tourist attraction are seafood, trumpeting animals, continuous birds chirping, scenic landscape, islands, tea gardens, national parks, and UNESCOs world heritage sites. Help, Academic The grocery industry experienced the startup stage between the 11th and 14th centuries. In the first stage, we constructed the grocery industry life cycle. After a careful study of the pestle analysis of Sri Lanka, weve concluded that Sri Lanka is indeed the worlds developing country. If you purchase a report that isupdated in the next 60 days, we will send you thenew edition and data extraction Free! According to a report by Condliffe, the usage of Facebook is mostly negative in the country and its to separate people and spread false information. Our premier, award-winning syndicated market research database provides detailed data and analysis on industries, economies, countries and consumers across 781 cities, 210 countries.. Its a never-ending process. Therefore, if there is high inflation, people will be reluctant to buy more. By 2020, the industry may see global sales nearing $30 trillion. The packaging is usually made up of plastic, and plastic causes environmental degradation. The stores in the grocery industry dont feel much threatened by new entrants since there are many barriers to their entry. Moreover, people are also unaware of the industry at this time, so companies try hard to attract customers. A strategic framework for technology evaluation. It pressurizes the Cargill A. to develop new products quickly, increase product range diversity, integrate flexibility into the value chain and develop healthy business relationships with value chain partners. - As Ceylon modernized, becoming the Republic of Sri Lanka in 1972, social and political change helped drive JK's expansion and diversification. Curious about how we partner with you to help you solve your complex modern-day business problem? Ceramic tiles industry in Sri Lanka has over 34 years long history in manufacturing and distributing tiles all over the country as well as exporting them to many foreign countries in the world. PESTEL Analysis of Royal Ceramics Lanka PLC Political - The . Lastly, Cargill A. should study the consumers leisure interests and should focus more on enhancing the customer experience if customers prefer experiential products over traditional product offerings. Frequent changes in government policies harm business performance by increasing environmental uncertainty. Legal factors become trickier once the company expands overseas or offers products online. Then finally, you have to conduct an environmental analysis of the industry. International business. All consumers love a good deal. Some countries offer subsidies for encouraging investment in renewable technologies. It would allow farmers and manufacturers to input information about food products in real-time. This repels customers. The country exports it toItaly,Germany, India,UK, and theUSA. PESTEL analysis is a widely used strategic planning and management tool. Because no one can afford or justify the purchases. Although the eat-in format in limited-service restaurants dominated value sales pre-pandemic, it was already losing ground to takeaway and home-delivery options, Standalone remained the dominant format of consumer foodservice outlets in Mexico in 2022, due the proximity of these operators to residential areas. Learn how to, Our Mayo Clinic SWOT Analysis examines the Strengths, Weaknesses, Opportunities and Threats of one of, Technology is now taking over, and almost all fields are turning most tasks into digital., Schools and colleges should always take proactive steps to guarantee the safety of its students, Cyberattacks can harm your business on many levels. Issa, T., Chang, V., & Issa, T. (2010). 5 Market Analysis 5.1 Regulatory Scenario . For instance, extreme weather conditions can increase the cost of operations and compel the Cargill A. to make the value chain more flexible. Wall, S., Minocha, S., & Rees, B. Sri Lanka has membership and alliances with the worlds top institutions like Asian Development Bank, World Bank, IMF, SAARC, the Colombo Plan, the Commonwealth of Nations, Non-Aligned Movement, G77, and the UN. Larger retailers can achieve this easier than mom and pop shops. Its always there, even when buyers dont have the funds to buy their products. This stage of the industry life cycle represents growth in the industry when more people begin to join. Cargill A. must consider these factors to ensure compliance with consumer protection laws. This affects the retail industry, particularly big names like Wal-Mart and Amazon, who provide products online. Each company offers retail products online, to be sold and shipped. All Rights Reserved, Economic factors: Nearly $30 trillion dollars in a couple more years, Social factors: Buying in bulk and collecting endless data, Technological factors: A digital catalogue for easy browsing, Environmental factors: Contamination and blockchain technology, A stronger economy allows consumers to buy products they want, more disposable income to spend on friverous products, main social factors affecting the retail industry, They use market research to identify buying trends, about environmental issues inside of the stores, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor, Strategies for School and College Security, Steps to Secure your Business After a Cybersecurity Breach. A recommendation is that the company's strategies must include the external factor of rising health consciousness among consumers. There are a lot of people working in the grocery industry. PESTEL. The country is drawing a lot of foreign investments every year. To gain more market share with identical products, grocery stores spend money to make their store look more attractive so that more customers get attracted to their stores. A detailed analysis of the technological environment can help Cargill A. capture the technological trends to achieve certain business advantages, such as- increasing profitability, boosting innovation process and enhancing the operational efficiency.