Business Communication Pest Analysis ofDebenhams| | Burcu Misir 3021110| | misirb| 11/22/2011| | Introduction All companies and organisations are affected by external influences intensively which affects factors as reputation and the sales of the company. External influences have a negative impact as well as negative impact. This essay will establish to assess at the external business environment of Debenhams. PEST analysis tool will be used in order to complete the assessment efficiently. PEST Analysis
PEST analysis is used for to understand market growth or decline and to discover the position, potential and direction of a business. It is also defined as business measurement tool. PEST stands for Political, Economic, Social and Technological. This method is also designed to assess the market for a business or organisational unit. ( Oxford Dictionary) Company Overview Debenhams is a British PLC company which started operating in 1778. Debenhams targeted audience is all ages from children to adults. Debenhams is mainly based in the UK and has more than 160 stores within the UK.
They operate outside UK in 60 worldwide franchising stores. Debenhams held over 30,000 employees which also hold headquarters in London. Debenhams store is the second largest department store in the UK after John Lewis. They offer wide ranges of products such as; women clothes, men clothes, children clothes, lingerie, accessories, health and beauty and home and furniture. Political Government sets regulation for all organisations to follow, meaning Debenhams which also contribute to. Health and safety is one of the most significant regulations by law that most businesses need to...
Therefore, Debenhams must meet the standards which, required by law in order to provide services to customers in self environment. A minimum wage regulation is one of the most common regulations which many organisations work under, which also applies to Debenhams workers to be paid at least the minimum wage. One of the political factors which may have an effect in Debenhams is the government’s regulation at the source nations. Debenhams supply cosmetics; therefore there are some regulations which need to be followed to complete the standard requirements.
The expiry dates for cosmetics can vary from the country to another for cosmetics which Debenhams will need to meet. UK budgetary revenue is based on domestic borrowing which carries approximately 30%. The money is mainly held through taxation and corporate e. g. Debenhams tax at a high level. When compared with other companies, Debenhams does not benefit from this factor, which also impacts on the overall profit of the company. ( REG Debenhams PLC, Interim Results, 2009) In Debenhams Annual Report it is stated that Debenhams meet the regulation of recycling.
Pollution in the UK is a serious factor which the government is aiming to reduce, therefore government introduced the regulation which is reducing and planning to set recycling law. Due to minimum wage regulation of worker, some political factors have affected operations of Debenhams for example the necessary recycling laws. This persuaded Debenhams to continue on its expenses of raw materials as there have to sometimes be recycled. Economic External sources of finance is one of the factors which Debenhams relies on i. e. et charg
capital to finance its process which means these basis of finance connect with set interest spending. These major financial costs are economical ramifications that may have an effect Debenhams financial place. ( Debenhams PLC, 2011) The other economic issue that has risen against Debenhams is that goods from competitor organisations have also swarming the marketplace, by providing cheaper and easier availability to access. They are a threatening competition to Debenhams and which may mean having to countenance the consequences of losing money. Recession is one of the main ssues which impact on economic factor. During recession period people who are under normal circumstances only expect to at least get by, which means they must spend less towards fundamental as opposed to reducing expenditure. People with lower incomes may find it difficult to purchase expensive products from Debenhams store which will then create an overall loss towards Debenhams overall sales. ( Daniel Bannes, 2008) Social Social challenges are very important to every organisation. Before introducing the product or the service it is essential to consider social conditions.
Improper information can lead to complete failure or poor product and service. Mentioning Debenhams, one of the major social issues of Debenhams is changes of taste and style, result stated from declining trend of consumer changing to other products (Debenhams, 2010) . In order to keep consumer demand sustainable Debenhams must think about issues like customs and beliefs of people e. g. geographical areas like Muslim communities wear specific outfits due to their religious beliefs, which illustrates that such issues tend to delay Debenhams’s procedure. Technological
In order to compete with efficiently to its competitors, ( Marks and Spencer) Debenhams must have the access to online selling facility. Customers demand increase as the shopping experience gets easier and quicker, it also enables customers to keep loyal as their needs and expectations are recognised. With the arrival of computerization many of Debenhams’s plant equipment have been used before and out of fashion as they are analogue as opposed to digital. It is a must Debenhams to have new computerized systems that will enable efficiency in production.
However Debenhams improved in a fast computerization program and bought consultancies and professionals to fast track the process. By working with e-business systems and other various advertisement modes in the electronic media such as blackberry, T. V etc, there has been a high demand from consumers placing orders. Debenhams turnover which was increased by ? 24bn in the year December 2005 to ? 28bn for the period ended December 2006. Conclusion Debenhams stores exist within a balance of external and internal environments which contains complex financial operations geared from servicing its credit ystem, employee satisfaction and profit making. The Human Resources regulations, training regulations, health and safety issues etc enables Debenhams employees to feel as important. In addition, technological improvements in their production enable them to provide better service as they maintain their mass production as well as maintaining quality. This benefits Debenhams to keep up their efficient reputation and credit in international quality awards. References Debenhams 2008, Overview of Debenhams; www. debenhamsplc. com/phonenix. zhtml? c=196805&p=overview [Accessed 18 November 2011] The Times