Carry Out A Pest Analysis
Carry out a PEST analysis of the computer industry and discuss the main external factors that affect firms in the industry.
The PEST analysis stands for Political, Economic, Social and Technological. These four factors have a great impact on all businesses. The reason for carrying out a PEST analysis is to discover what external factors effect a business and to determine the success of a business.
Political
The political issues that revolve around the computer industry is that firstly, the increase in taxes on import and fuel by the Government would result in an increase in production and transportation costs. To minimise the impact of this problem, computer manufacturers could attempt to adopt alternative methods of production and transportation. However, this may increase additional costs as manufacturers maybe under contract with a transport firm. Another option would be to pass on the costs to consumers through increased prices. The success of this would be dependent on the elasticity of the product and brand loyalty. For example if Dells consumers have brand loyalty for Dell, then consumers may not mind purchasing the computer at a higher price. In contrast, if the Government were to decrease taxes, then the computer industry would benefit from lower
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