According to Harvard professor, Francis Aguilar, PESTEL Analysis is a took used by researchers or marketers to analyse the effect of macro- environmental factors on a business. This can be used to identify the threats and weaknesses which can be avoided, by introducing more strategies which could help in further increasing the profitability.
Diagram 2: PESTEL Analysis
These factors refer to how government policies effect the working of the small- scale businesses. Political instability can cause restrictions on trade policies and over all operation of the retail store (Yusop, 2018).
These factors refer to analyse the income and other economic factors such as taxes, interest rates and price of the supplies. This directly affects the profitability of these businesses (Yusop, 2018).
The socio- cultural factors such as population, religious beliefs, health, attitudes among other things, affect the profitability of a business. This is due to the fact that these factors are really important for the customers (Yusop, 2018).
Technological factors directly impact the way businesses can advertise the products on the market (Yusop, 2018).
Environmental factors influencing in small businesses only became important recently. This is due to the scarcity of raw materials, carbon foot prints and the understanding of sustainability. The customers started demanding products that are sourced ethically and a sustainable source. This also directly affects the customer relationship (Yusop, 2018).
Legal factors such as health and safety, employees as well as customer rights, product safety directly affect the success of the business (Yusop, 2018).
This gives us a clear picture on how effective the current marketing s