Plest Analysis for Tesco's and Water Aid Essay example

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PLEST analysis for Tesco's And Water AID

PLEST is a strategic planning tool used to evaluate the impact political, economic, social, and technological, Legal and Environment factors might have on a project. It involves an organisation considering the external environment before starting a project.
The PEST analysis is an important part of the project planning process:
• Political factors include areas such as tax policy, employment laws, environmental regulations, trade restrictions and tariffs and political stability.
• Economic factors are economic growth, interest rates, exchange rates and inflation rate.
• Social factors often look at the cultural aspects and include health consciousness, population growth rate, age
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One of the most influential factors on the economy is high unemployment levels, which decreases the effective demand for many goods, adversely affecting the demand required to produce such goods. In a charity this can reduce the amount of donors and volunteers.

TAXATION

TAXATION – has a big effect on businesses:

There are two basic types of tax:
1. DIRECT TAXES: these are taken directly from people’s wage packet – P.A.Y.E.
2. INDIRECT TAXES: these are placed on spending e.g. Value Added Tax (17.5%)

Increased taxes are bad for Tesco and water aid because:
• People have less money to spend on their products – their disposable income has fallen
• they will have to pay higher taxes on their profits

INTEREST RATES

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