In the grocery industry, buyers have great power. It just means they dont have the means to meet the same demands as the bigger retailers. The government should address issues like food price inflation, create and save employment opportunities in the apparel industry, protect the rights of ordinary workers, and stabilize the countrys economy. Or when a certain industry is hit harder than others. Grocery stores are afraid to get substituted since a huge number of homogeneous stores exist that offer the same products. After that, we proceeded to the second step, where we assessed the competition in the grocery industry analysis. Understanding the impact of technology on firms business models. Political stability creates economic growth, due to which the disposable income of consumers increases. This PEST country analysis report on Sri Lanka provides a holistic view of the country, with insightful analysis of current and future issues, supplemented with relevant quantitative data to support trend analysis. Hou, J., Lu, Q., & Han, Y. Market Research Reports, Inc16192 Coastal HwyLewes, DE 19958, USA. inspiration, guidance, and understanding. The business practices of the Cargill A. are influenced by the prevailing economic structure. Pearson Education. Although the state is trying to make the investment climate more attractive, economic mishandling is adversely affecting output, which is pressurised by hyperinflation. He is a lecturer in Management and Marketing. GSTF International Journal on Computing, 1(1), 73-80. Instead, they are owned by small sole proprietors. Other than that, hes a fun loving person. Sri Lanka has made some good progress in science and technology over the years. Cargill A. can take it as an opportunity and adopt green business practices to win the trust of stakeholders. Retailers who offer products online can collect data provided by their customers. Cargill A. operates in a complex and dynamic environment characterized by regulatory changes, growing environmental activism, collective social trends, technological changes and evolving legal system. Its going to analyze the macro-environmental factors impacting the worlds leading developing country. Other small name companies cant compete on the same scale. Excessive resource depletion by Cargill A. can draw the negative response from media, environment protection groups, customers and the general public. Moreover, if the government of the country under consideration is not serious about protecting the intellectual property rights of business organizations, it will deter the entrepreneurs from investing in organizations due to high risk of ideas being stolen. Many countries have placed strict norms to protect their urban areas through effective waste management. The major languages are Sinhala, Tamil, and English, while Buddhism, Hinduism, Islam, and Christianity are the major religions. The data protection has become an important issue due to consumers privacy and security concerns. Moreover, people are also unaware of the industry at this time, so companies try hard to attract customers. Read More. to get Coupon Code. In some cases, this can be beneficial. The minimum monthly wage according to the National Minimum Wage Act is 10,000 Rupees worth 50 US dollars. Proposal, Question on WhatsApp for any queries. In fact, Sri Lanka is one of the biggest receivers of Chinese FDI. Entering in markets where technological advancement has not reached the maturity means Cargill A. can increase the market share by focusing on emerging technological innovations. Cargill A. should consider the following legal factors when exploring a new market. A critical study on Various Frameworks used to analyses International Business and its Environment. Economic factors affecting Sri Lanka. The Sri Lankan political environment is facing some challenges like suppression of freedom of speech, political dominance struggle, and civil war. take time-critical decisions. The growing inequality in many countries is altering the power structure, which has serious implications for international business organizations like Cargill A. Cargill A. need to study the traditionally assigned gender roles to align its marketing and communication practices accordingly. High unemployment signals the availability of surplus labor at comparatively lower wages. The economic development in Sri Lanka is causing some severe environmental issues like poor waste management, overfishing, deforestation, the falling rate of mangroves, water pollution, and air pollution. This PESTEL/PESTLE analysis reflects a number of opportunities and threats that Unilever must prioritize in its strategies for growth and global expansion in the consumer goods market. Because when contamination happens, every store in the chain has to get rid of the product. 24-27). A framework for PEST analysis based on fuzzy decision maps. please submit your details here. Consumer Foodservice By Location in Mexico, Analysis of the country's political and macroeconomic stability, An overview of the economic structure and major industries. To conclude, the PESTEL model is an important business tool that involves a detailed analysis of macro-environmental factors that shape the business environment. IFS marks 25th anniversary of the inception of its operations in Sri Lanka as it sees continued success in technology excellence In FY22, the company obtained three new patents; in addition, it submitted 36 new designs and applied for about 44 more patents across several . 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. Such changes can also influence the consumers' spending patterns, causing the organization to revise its product and marketing strategies. Surely, it needs to work on political stability, and reforms. 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. However, more needs to be done to accelerate the digitalisation process. In this way, grocery stores are essential for the economy. 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. The country must work on to ensure that the economy is stable, the rights of informal workers (70% of the workforce) are protected, the jobs in the apparel industry are saved, and high food price inflation is brought down (World Bank, 2020). Some countries offer subsidies for encouraging investment in renewable technologies. They contribute significantly to keeping the retail industry functional. Cargill A. should invest time on understanding the consumption motivations and social trends that define the consumption behavior. 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. The grocery industry requires political stability to make a profit. 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. Solution, Assignment Writing The Sri Lankan economy is going through a massive transition. The first task we had was to do a PESTEL analysis of our home-country that we were in charge of. They can easily see which products people are buying, leaning towards, or completely ignoring. There are multiple stages in the life cycle of any industry. The public authority is a combination of the parliamentary and official framework. Its not only physical retail stores under scrutiny. The grocery industry experienced the startup stage between the 11th and 14th centuries. Major political instability and distressed government finances have blighted Sri Lanka, which is mostly unfree for economic freedom. (2019) The Week in Tech: Data Doesnt Support Sri Lankas Social Media Blackout, available at: https://www.nytimes.com/2019/04/26/technology/sri-lanka-social-media.html (accessed 01 March 2021), Hewage, K. and Munasinghe, D. (2019) Technology and economic transformation: Is Sri Lanka prepared to ride the 4IR wave?, available at: http://www.ft.lk/opinion/Technology-and-economic-transformationIs-Sri-Lanka-prepared-to-ride-the-4IR-wave-/14-676196 (accessed 08 March 2021), OEC (2021) Sri Lanka, available at: https://oec.world/en/profile/country/lka (accessed 07 March 2021), Peiris, G. (2021) Sri Lanka, available at: https://www.britannica.com/place/Sri-Lanka (accessed 08 March 2021), Trading Economics (2021) Sri Lanka GDP, available at: https://tradingeconomics.com/sri-lanka/gdp (accessed 09 March 2021), World Bank (2020) Sri Lanka Overview, available at: https://www.worldbank.org/en/country/srilanka/overview (accessed 09 March 2021), Worldometer (2021) Sri Lanka population, available at: https://www.worldometers.info/world-population/sri-lanka-population/ (accessed 09 March 2021). European Journal of Innovation Management, 16(3), 285-300. Blackridge Research's Sri Lanka Solar Power Market Outlook report consolidate the developments and build a perspective on growth from the point of view of the solar sector, in its current and future role. If you are looking for a market research solution for your research requirements, please begin your search using the search box on top of this page or use our chat system to speak to our market research consultants or directly write to us. This factor analyses how threatened companies feel in an industry from getting substituted. Once a food, like lettuce, has E.coli, every store needs to toss out their lettuce. Consumers prefer the natural toothpastes to the synthetic, artificial flavored toothpaste that is commonly found. But just like every other industry, the retail sector is affected by the six principles of PESTLE/PESTLE analysis. (Ed.). Okay, I might be being a little dramatic because I can still get my groceries from the supermarket, but its not the same. Issa, T., Chang, V., & Issa, T. (2010). Approximately21,803,000people are populating the Island, and its the worlds58thmost populous country. Hence, the grocery industry suffered. Files are delivered directly into your account soon after payment is received and any tax is certification is verified (where applicable). These steps can help you get back, Copyright 2020 Weberience LLC. Posted by Zander Henry on This stage of the industry life cycle represents growth in the industry when more people begin to join. After the growth stage, an industry undergoes the shakeout stage. (2014). This helps the grocery industry generate high revenue. However, this transformation is helping the country to attract foreign investors. Other minority religions are Hinduism (12.6%), Islam (9.7%), and Christianity (7.4%). 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. Cargill A. should carefully consider the on-going technological innovations to stay ahead of the competition. The corruption can influence various business operations, ranging from licensing, contracting, fraudulent deals to frequent lawsuits. The stores in the grocery industry dont feel much threatened by new entrants since there are many barriers to their entry. This investment will also increase stakeholder satisfaction and expand the customer base due to enhanced brand image. The National Minimum Wage Act, No. Check your email We work with our associate Global market research firms who are known leaders in their respective domains to obtain right market research solution for our customers needs, be it custom research or syndicated research reports. Porters five forces model helps analyze the competition level in an industry. 5 Market Analysis 5.1 Regulatory Scenario . Yksel, I. In case of a global recession, the purchasing power of the people will drop, and the grocery industry will observe severe financial losses. Likewise, it needs to work more on ensuring communal harmony and upholding human rights of journalists, minorities, and others (Amnesty International, 2021). Operating in countries with high corruption level and weak law enforcement makes the business environment increasingly unpredictable for Cargill A. due to jeopardized public trust on business organizations and overall political and economic structure. Each society has distinctive norms and values that play an important role in shaping consumer behavior. New technologies such as eCommerce have emerged as technological developments have taken place. The industrys supplier power represents suppliers power to dictate prices. Analyze the Sri Lanka external competitive environment to identify opportunities and threats. In the year 2015, Sri Lanka has exported approximately 467 Million U.S dollars' worth of Cinnamon. Grnig, R., & Morschett, D. (2017). Its fast and easy to use. We are here to help. The capital of the country is Sri Jayawardenepura Kotte, whereas Colombo is the trade hub and largest city. Like a point of sales system. At this stage, the industry is booming and has reached its peak. Sri Lanka has conflicted relations withIndiain the past, but both countries have managed to resolve their conflict amicably. Sri Lankas top main exports are ladies undergarments and tea. Total asset base amounts to Rs. Heres what you need to know. A., & Gomez, o. Not only to streamline services, but also to reach audiences worldwide. High GDP also signals the consumers ability to spend more on offered products. Analyze the Resort Heritance external competitive environment to identify opportunities and threats. Hence all the suppliers have identical products. Heres the pestle analysis of Sri Lanka as follows; Sri Lanka follows the semi-presidential system of government and administration. Political factors: Anti-trust issues. Country Background 5 Page For conducting external environmental analysis of Coca-Cola, the country selected is Sri Lanka. The organization should also carefully consider the interest rate and its influence on borrowing ability and attitude towards investment. Therefore, they wont let newcomers come and snatch their market share. The current account balance for Sri Lanka was estimated to be negative at USD 1.932 billions for the year 2016 and is expected to decrease at a CAGR of 2.35% and reach USD 2.364 by 2022. 11.12 Sri Lanka 11.13 Thailand This can only happen if the suppliers are low in numbers or they are supplying something very unique or scarce. Thank you for your email subscription. PESTEL analysis is a widely used strategic planning and management tool. Since grocery stores hold great significance, today we have decided to conduct a Grocery Industry Analysis. The high fluctuation on local currency can be a cause of serious concern for Cargill A. Providing a secure work environment for the workforce is the ethical and moral obligation of Cargill A. Now that you know what an industry analysis is, lets move ahead and carry out the grocery industry analysis. Sri Lanka has a mixed legal and judiciary system. A largely rural-based economy is shifting towards a more urbanized one with focus on manufacturing and services (World Bank, 2021). After we cleared the difference between the two, we conducted the grocery industry analysis. Now that we are done discussing the life cycle of the grocery industry lets proceed to the second step of the Industry analysis to see the level of competition that exists in the industry with the help of Porters five forces model. If you are happy with this select "Accept All". The demand and supply of labor determine the wage rates and supply of skilled workforce. The supermarket industry in Sri Lanka is set out for an explosive growth in the recent years this is with the western lifestyle of modern Sri Lankans where convenience is a key benefit sought . It is worth noting that Sri Lanka faced a number of political challenges e.g. In this PESTLE analysis, we'll look at the Political, Economic, Sociocultural, Technological, Legal, and Environmental factors affecting the food industry; in particular, we'll look at how both restaurateurs and food distributors might be affected by current trends. Likewise, communal tensions and discrimination due to low caste system also need to be addressed. Pestle Analysis on Sri Lanka. Approximately more than 21 million people are populating Sri Lanka. The Democratic Socialist Republic of Sri Lanka or Ceylon is a South Asian island country. Moreover, considering the development and maturity level of technology in the respective market is also important. 2. Here you can find food products, clothing, and electronics, in large quantities. Ranging from political factors to environmental factors, each factor comprises various variables that influence the strategic decision making process of business organizations like Cargill A. Aithal, P. S. (2017). They all promote the countrystourism industry. PESTEL analysis is a widely used strategic planning and management tool. Regulatory bodies emphasis on ensuring compliance with environmental norms is altering the product innovation priorities. According to the annual reports of each company that produces ceramic tiles, shows continuous growth of profits in parallel with net sales. Is commonly found caste system also need to be addressed can easily see which people... Freedom of speech, political dominance struggle, and Christianity ( 7.4 % ) deals to lawsuits... Store in the grocery industry dont feel much threatened by new entrants since there are stages. 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At this time, so companies try hard to attract customers stages in the industry more. Are ladies undergarments and tea the worlds58thmost populous country and attitude towards investment of skilled workforce products people populating. Help you get back, Copyright 2020 Weberience LLC the means to meet the demands. Environmental norms is altering the product fun loving person shifting towards a more urbanized one with focus on and... Ahead of the country selected is Sri Jayawardenepura Kotte, whereas Colombo is ethical! T., Chang, V., & issa, T., Chang, V., & Morschett, D. 2017. Exploring a new market company that produces ceramic tiles, shows continuous of... Step, where we assessed the competition external competitive environment to identify opportunities and threats are... Has distinctive norms and values that play an important role in shaping consumer behavior consumers... Parliamentary and official framework a combination of the Cargill A. are influenced by the prevailing economic structure should carefully the! Cause of serious concern for Cargill a influence on borrowing ability and attitude towards investment,. Bodies emphasis on ensuring compliance with environmental norms is altering the product analyze... And its influence on borrowing ability and attitude towards investment is hit harder than others ; worth of.! Influenced by the six principles of PESTLE/PESTLE analysis win the trust of stakeholders and has reached its peak,!
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