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PESTEL Analysis of

Burberry Group Plc

1. Understanding the importance of The PESTEL Analysis of Burberry Group Plc

The PESTEL Analysis of Burberry Group Plc will help the company make strategic decisions
correctly, keeping in perspective the external trends, and factors of the external environment.
The PESTEL Analysis of Burberry Group Plc will take into account the most important aspects of
the external environment that impact the business. Alongside, PESTEL Analysis of Patagonia Gold
Plc will equip the business for taking advantage of potential growth opportunities through
identifying market trends and behaviours.

The following sections details the Burberry Group Plc PESTEL Analysis. The Burberry Group Plc
PESTEL Analysis will look at the external factors – political, economic, social, technological,
environmental, and legal. It is important to note that the Burberry Group Plc PESTEL Analysis
will be market specific, and the implications of the factors change for a company when the
market changes.

2. Political

2.1. Government stability

The strong political structures and institutions support growth and development for
Burberry Group Plc
Government stability also allows businesses like Burberry Group Plc to expand regionally
as well as internationally
Trade relations with other countries because of political stability and strength allows
businesses like Burberry Group Plc to maintain offshore business affiliations easily and
smoothly
Government stability also attracts investors for businesses and companies such as
Burberry Group Plc – which leads to growth and development in the infrastructure as well
as enhances international image
High government stability can also attract resources for industry development as a
whole, which in turn will boost player performance and improve overall competitive
positioning

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2.2. Tax policy

Favorable tax policies allow businesses like Burberry Group Plc to expand easily
Government subsidies and favorable tax rates will also allow Burberry Group Plc to
maintain competitiveness by controlling its costs of doing business
Costs of doing business, in turn, will also not be passed on to the consumers – thereby
allowing consumers to enjoy favorable and competitive pricing
Desirable tax policies that support business growth and development will allow
businesses like Burberry Group Plc to expand, and thereby add to creating economic value
for the country as well

2.3. Competition regulation

It is important for government and political institutions and bodies to monitor
competition in the industry
This will ensure that companies are using fair play for their products, and also
business tactics and strategies
Competition regulation will also help the government monitor, restrict and regulate
imports to help local businesses grow and expand
Competition regulation is important for the protection of all groups and stakeholders,
as well as for maintaining the rights and interests of the related stakeholders

2.4. Trade blocks

Companies like Burberry Group Plc can take advantage of trade blocks and trade
treaties that have been formed and signed by the respective country of origin
Trade blocks can facilitate businesses like Burberry Group Plc by lowering resource
costs, lowering cost of doing business, as well as increasing the supply of talented
people
With trade blocks, companies like Burberry Group Plc can also make their products and
services easily accessible through various channels and distribution agencies for
consumer to purchase and benefit from
Strong industrial ties could be developed and maintained under trade blocks across
borders, and in different countries which could help companies like Burberry Group Plc
benefit from advanced knowledge, knowhow and technology as well.

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3. Economic

3.1. Inflation rate

A moderate inflation rate is needed in the economy for companies like Burberry Group Plc
to flourish
A moderate inflation rate will also help the business grow and work positively towards
increasing the consumer confidence, and consumer spending trends
As a result, the economy will get a boost and the overall disposable income will also
increase
A higher inflation rate would lead to a lower disposable income, and thus could lead to
lower overall expanding, which could harm businesses and companies, as well as lower
consumer confidence
A lower inflation rate will lead to a high increase in the disposable income, and
thereby could increase competitiveness, especially through pricing strategies which
could lead to unethical price wars that take undue advantage of the consumer.

3.2. Interest rate

A moderate interest rate will help businesses sand companies like Burberry Group Plc
in taking loans from the banks
This business loan would be used for purposes of growth and development
Business loans would also help in the development and building if the industry
infrastructure at a large level
Moderate to interest rates would also allow individuals to take personal loans.
With lower to moderate interest rates, personal loans will translate into higher
purchases and consumption patterns by the consumers. This in turn would lead to a boost
in sales, consumption and penetration of businesses like Burberry Group Plc.

3.3. Consumer spending trends

Consumer spending trends are important and critical for companies like Patagonia Gold
Plc, and their performance
Higher consumer spending trends are preferred as they lead to higher purchases and
consumption of products sold by Burberry Group Plc
The higher consumer spending is also reflective of higher purchasing power, which is
important for increasing overall consumption patterns, and health of the economy
These higher consumer trends can be positively influenced through product quality and
marketing strategies
In addition, these trends are also influenced by other economic indicators such as
inflation rate, interest rate, and unemployment trends.

3.4. Unemployment trends

Higher unemployment trends will lead to lower overall disposable income in the
economy, which in turn would directly affect the performance of companies like Patagonia
Gold Plc
Higher unemployment trends could also be reflective of a gap in labor skills and
knowledge – which again would harm consumers through higher prices of the products. The
higher prices would be associated with the increased cost of doing business when labor
would be imported from other sources for purposes of work.

4. Social

4.1. Demographics

A higher portion of the younger population is beneficial for Burberry Group Plc as it
will allow the company a larger consumer population base
In addition a younger population will also promise Burberry Group Plc with more
skilled and educated workers and human resources, thereby adding breadth and depth to
the talent pool
A moderate to high middle class is also important for Burberry Group Plc as its
current consumers, and advocates
This group acts as brand ambassadors for Burberry Group Plc, and encourages younger
population to become loyal customers as well

4.2. Education

A higher education in the population is desirable for multiple reasons that will benefit
Burberry Group Plc
A higher education means more talented, skilled, and knowledgeable persons in the talent
pool for Burberry Group Plc
A higher education also means that the population s consumers will be more aware of
their purchases and consumption patterns
As a result, they will focus on positive consumption which will give Burberry Group Plc
an advantage because of its unique competitive positioning and placement
A higher awareness level also means that consumers will prefer quality, and will be
knowledgeable of what the product promises and delivers. This comparison will form basis
of repeat purchase
Again, Burberry Group Plc will be at an advantage because of their focus on quality

4.3. Family size and structure

The family structure and size determines the frequency and nature of purchase made
This is also important for understanding consumption patterns
For the target population it he current market, Burberry Group Plc is faced largely with
families of nuclear style, with two older children, and sometimes a younger child
The key decision makers are eth parents, though they take into consideration the
suggestions and requests of their children
These parents as kept decision makers are influenced by marketing, store manager
reviews, and recommendations and by friends and family
As a result, Burberry Group Plc applies push and pull strategies for its appeal

4.4. Health consciousness

An increasing portion of the population is adopting health and wellness trends
The health and wellness trend has also translated into consumption decisions and
patterns
Burberry Group Plc has introduced health aspects in its marketing, and also add features
of health in their products as per consumer research and behavioral assessments.
The increased health consciousness has also led Burberry Group Plc to make
collaborations and take CSR initiatives focusing not only on physical, but also mental
and emotional health and wellbeing.

5. Technological

5.1. Technological infrastructure

The country has a strong infrastructure with regards to technology
There is a high rate of technological development and advancement
Increasingly, businesses like Burberry Group Plc are incorporating technological
up-gradations and innovation to increase business efficiency and affectivity
There is high rate of innovation across all industries, which makes companies
including Burberry Group Plc competitive as well as progressive
The improved technological infrastructure also helps in attracting foreign direct
investment, which in turn leads to further development and advancement
The improved technological infrastructure also helps in attracting foreign direct
investment, which in turn leads to further development and advancement
As a result, Burberry Group Plc has a distinctive competitive advantage in terms of
technological advancements, and the business continues to make use of, as well as
participate in innovation processes to enhance the business cycles and operations

5.2. Internet penetration

The country, and all consumer markets enjoy a high rate of internet penetration
The high penetration of internet is used for personal and social lives along with
professional responsibilities
most all of the population own a smart phone for internet accessibility, and have
access to computers and laptops as well
The higher penetration of internet reflects a progressive and educated population,
which is beneficial for Burberry Group Plc
Burberry Group Plc has also made use of the high internet penetration to reach
consumers, and for marketing and promotional strategies to be able to directly interact
with consumers and gather feedback
As a result, the higher internet penetration has helped Burberry Group Plc in
improving its quality and delivery, as well as allowed it to engage in strategic
communications and marketing processes

5.3. Use of social media

There is a higher portion in the population of the youth, as well as middle ages persons
These population segments widely make use of social media for connectivity
Increasingly, social media is also being used by businesses like Burberry Group Plc for
gathering consumer data and information
Burberry Group Plc also interacts with, gathers feedback, and communicates promotions to
customers through official social media channels
Business like Burberry Group Plc have also started using social media for purposes of
recruitment, which highlights the changing trends in the business community with respect
to social media.

5.4. Investment in R &D

There is a high level of local as well as international investment in the
technological R&D of the country
The high investment helps in advancing industries, and equipping them with new, and
more flexible as well as effective ways for business operation and other business
processes
The higher investment, and related research has also allowed for an increased rate of
innovation
Businesses take advantage from innovation and development through the overall
industrial growth along with development of competitive edge for the industry in the
global market
Adaptations by individual players like Burberry Group Plc also leads to the building
of high competitive advantage for companies

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6. Environmental

6.1. Recycling

There is an increased focus on environmental sustainability and recycling
Consumers are becoming more aware, and demanding ways for recycling products to be
disposed off
Consumers are also increasingly demanding recycled products for consumption
Burberry Group Plc has launched specific sites for disposing off products to be
recycled
Burberry Group Plc, like many other players, is also introducing a novice product line
of recycled products for consumers to benefit from

6.2. Waste management

The country has high regulations for waste management and control
Burberry Group Plc should associate itself with, and register with the waste
management authorities and institutions to be able to follow regulations, maintain
checks, and avoid any future hassles
Burberry Group Plc, in view of environmental sustainability, already has a controlled
and designated process of managing waste, and disposing waste in an environmentally
friendly manner.

6.3. Green consumption

The increased awareness of environmental sustainability has also given way to an
increase in the green lifestyle
Consumers in the country, and across all markets are increasingly preferring products
and services that are green i.e. produced and marketed using environmentally friendly
and sustainable ways and methods
Companies are also hopping on the bandwagon and introducing green products to appeal
to the consumers
Burberry Group Plc engages regularly in environmental friendly CSR activities.
Burberry Group Plc has also introduced a green product line – which is a variation of
its existing products. The company plans on increasing weightage for the green product
line gradually to increase its role in environmental sustainability.
Burberry Group Plc also contracts with suppliers and distributors in its integrated
back chain, who are following strong principles with regards to environmental
sustainability

6.4. Renewable energy investments

The country as a whole it all its industries is gradually moving towards the use of
renewable energy for operations and business processes
This is being done to reduce the environmental footprint by the market, as well as for
reducing the carbon effect
Burberry Group Plc and related industry members are increasingly making use of solar
energy, and hydroplanes for purposes of operation management and business processes
Burberry Group Plc has a company controlled hydro plant – on a small scale – to help
in manufacturing operations.

7. Legal

7.1. Health and safety law

There are strict regulations pertaining to the health and safety of employees at the
workplace
Respected associations and institutions regularly check with businesses about
implementation of safety nets, drill, and precautionary measures at the workplace
The safety and health involves not only physical wellbeing, but also the emotional and
mental wellbeing if employees.
Burberry Group Plc has placed high importance of the safety and health of its employees,
a and continually strives to improve it further

7.2. Employment laws

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Country wide regulations demand businesses to form legal contracts pertaining to
employment
These contracts are authorized by the respected governmental bodies, and involve all
aspects of employment
Employability contracts ensure a healthy relation between all parties involved, and
also ensures that there is no misunderstanding or colluding
Burberry Group Plc practices employment laws, and briefs its employees about the same
during the recruitment process
The HR department of Burberry Group Plc also regularly conducts workshops and training
sessions for employees to engage them, and make them aware of the employment laws, along
with other legal formalities.

7.3. Anti-discrimination law

The country and the market is made up of divers population
There is a high number of immigrants, and the businesses from the country also
operates at multiple off shore locations
Burberry Group Plc, as a result, has always been comfortable with diversity in its
workforce, and has framed internal company policies to support diversity
The company follows the anti-discrimination law in all its processes – from
recruitment to promotion
All employees regularly undergo diversity trainings and workshops to be able to avoid
discriminatory and prejudiced actions – which could have severe repercussions
Burberry Group Plc, like other players in the industry, is an equal opportunity
employer
Burberry Group Plc also ensures that there is no discrimination within the company,
and the organizational culture remains toxic free
Burberry Group Plc ensures this by following regulations about the anti-discrimination
law as well as through regular investment in trainings and employee development sessions

8. References

Bierly, P. & Hämäläinen, T., 1995. Organizational learning and strategy. Scandinavian
Journal of Management, 11(3), p. 209–224.
Cole, G., 2003. Strategic Management. Boston: Cengage Learning EMEA.
French, R., 2011. Organizational Behaviour. Hoboken:NJ: John Wiley & Sons.
Hersey, P., Blanchard, K. & Johnson, D., 2001. Management of organizational behavior:
Leading human resources. New Jersey: Prentice Hall.
Hiriyappa, B., 2009. Organizational Behavior. New Delhi: New Age International.
King, D. & Lawley, S., 2016. Organizational Behaviour. Oxford: OxordUniversity Press.