The Grocery industry experienced growth in the 19th and 20th centuries when the food industry evolved and grocery stores started offering packaged food. But even smaller shops can benefit from offering discounts and sales on products. Cargill A. can take it as an opportunity and adopt green business practices to win the trust of stakeholders. Springer Berlin Heidelberg. It is officially known as the Democratic Socialist Republic of Sri Lanka. According to an estimate, the annual nominal GDP of Sri Lanka in 2020 was81.120billion dollars, and its66thworlds highest. The products are either shipped to the customers home or the closest store for pickup. Technology' is the fourth factor of PESTEL analysis. If other companies used this, they would know whether their lettuce is truly contaminated. Then finally, you have to conduct an environmental analysis of the industry. PESTEL. Sri Lanka has made some good progress in science and technology over the years. 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. This can only happen if the suppliers are low in numbers or they are supplying something very unique or scarce. Files are delivered directly into your account soon after payment is received and any tax is certification is verified (where applicable). Legal is the sixth factor of PESTEL analysis. Hence, Cargill A. should study how intellectual property rights are protected in the host country and make the business strategies accordingly. Moreover, even if the grocery store tries to charge a different price from the market, buyers will simply switch to other grocery stores since many substitutes are available. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Cargill A. Once a food, like lettuce, has E.coli, every store needs to toss out their lettuce. Accordingly, we never encourage or endorse its direct Within PESTEL analysis, political factors exert a strong influence on the long-term sustainability and profitability of Cargill A. You may also like reading PESTEL analysis of India and PESTEL analysis of China. Operating in such a market can lower the production cost of Cargill A. Sri Lanka has a mixed legal and judiciary system. Copyright 2017 2025. This is set by the government. Strategy. British colonists arrived and colonized the island from 1815-1948. Cargill A. operates in a complex and dynamic environment characterized by regulatory changes, growing environmental activism . Proposal, Assignment Writing The grocery stores are smaller in size and offer limited products, of which almost 90% are food related. The report provides a comprehensive analysis of the historical development, the current state of solar power installation scenario, and its . The economic and regulatory environment in a monopolistic or oligopolistic structure will be different from the monopolistic competition and perfect competition. Sri Lanka is a South Asian country that has a rich cultural heritage. As Cargill A. looks to expand and leverage its competencies and core capabilities, conducting the PESTEL analysis is imperative for developing effective strategies and achieving long-term growth objectives. This market research report covers current and future business risk analysis forSri Lankaalong with macroeconomic factor analysis. It pressurizes the Cargill A. to develop new products quickly, increase product range diversity, integrate flexibility into the value chain and develop healthy business relationships with value chain partners. 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. There are multiple stages in the life cycle of any industry. It also means having to abide by more economic and political factors. All Rights Reserved, Economic factors: Nearly $30 trillion dollars in a couple more years, Social factors: Buying in bulk and collecting endless data, Technological factors: A digital catalogue for easy browsing, Environmental factors: Contamination and blockchain technology, A stronger economy allows consumers to buy products they want, more disposable income to spend on friverous products, main social factors affecting the retail industry, They use market research to identify buying trends, about environmental issues inside of the stores, 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. Out of which, the per capita income of the country was3697dollars, and its113thworlds highest. The industry analysis consisted of three stages. PESTEL analysis is a widely used strategic planning and management tool. There is a growing trend towards the use of green/eco-friendly products. Bureaucracy and corruption negatively influence the business environment. Technological factors affecting Sri Lanka. Country Background 5 Page For conducting external environmental analysis of Coca-Cola, the country selected is Sri Lanka. Sri Lanka has a rich and long history dating back to125,000years ago, but the country has a documented record of3000years. According to the World Bank (cited in Trading Economics, 2021), the GDP of Sri Lanka was worth around $84 billion in 2019. Major political instability and distressed government finances have blighted Sri Lanka, which is 'mostly unfree' for economic freedom. Where should we focus our expansion strategy? - Political stability and policy continuity is essential for economic and business growth. Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. Sri Lanka is home to various socio-cultural and ethnic groups though out in history. At Market Research Reports, Inc. we aim to make it easier for decision makers to find relevant information and locate right market research reports which can save their time and assist in what they do best, i.e. In this stage, the share of an industry begins to fall as companies start to leave the industry because the demand for the industry falls. However, the country has also developed very relations with regional countries likeChinaandPakistan. Political - turmoil, Economy - shambles, Social - upheaval, Technology - fallout as no power, Environment - distraction due to poor policy implementation, Legal - politicised hence no consistency. As does data and copyright laws. The first task we had was to do a PESTEL analysis of our home-country that we were in charge of. In this way, grocery stores are essential for the economy. Cargill A. should also carefully analyze the availability of skilled human capital as a shortage of skilled labor can affect business efficiency and make talent attraction and retention more challenging. Likewise, the computer literacy rate needs improvement as it was only 27.5% in 2019 (Hewage and Munasinghe, 2019). Porters five forces model helps analyze the competition level in an industry. This is why grocery stores in the industry feel threatened. It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. Majority of the people live in rural areas and rely significantly on agriculture for their livelihood. Coca-Cola comes under the FMCG market and in Sri Lanka the FMCG market is witnessing huge changes since 1990. The Latest Released Micro EVs market study has evaluated the future growth potential of Global Micro EVs market and provides information and useful stats on market structure and size. More retail shops are offering food products. It is important for Cargill A. to understand economic factors such as foreign exchange/interest rate, labor market conditions, inflation and saving rates etc. In such an environment, Cargill A. should invest in disruptive technologies to maximize the profits and re-invest the profits for future disruptive technologies. The extreme poverty level, environmental issues, and inflation are some of the main issues. Literally. The revenue and profitability of any retail store are affected by government policies. It has very close cultural interactions with India as well. ~ 0.0 Page). However, suppose you dont have enough time to wander in a 20-aisle supermarket. 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These steps can help you get back, Copyright 2020 Weberience LLC. Then the international laws come into play. Cargill A. cannot enter a new market without studying in detail the legal environment and regulatory structure of the new consumer market. These conditions are often standard. Consumer Foodservice By Location in Mexico, Analysis of the country's political and macroeconomic stability, An overview of the economic structure and major industries. The business practices of the Cargill A. are influenced by the prevailing economic structure. Focused R&D and innovation at Blue Star driving growth: Blue Star Limited strengthens its R&D ecosystem, enabling it to release new, innovative goods and services to meet various client needs, giving Blue Star a significant advantage. on WhatsApp for any queries. 5.4 Ansoff Matrix Analysis 5.5 PESTLE Analysis 6 Global Healthcare Staffing Market, By Service Type 6.1 Introduction . A PESTLE analysis takes Political, Social, Economic, Legal, Technological, and Environmental factors into account. Moreover, there are no substitution costs. please submit your details here. When retail stores branch into other countries, they need to abide by the policies in that country too. Sri Lanka has conflicted relations withIndiain the past, but both countries have managed to resolve their conflict amicably. PESTEL analysis is critical to understand the external threats & opportunities arising because of the macro environment developments. Technological trends can be used to start the creative social media campaigns for developing online brand communities. The packaging is usually made up of plastic, and plastic causes environmental degradation. The regulations affect which products can be imported, exported, and sold in stores. Grocery stores mainly keep packaged food items. The online shopping trend is growing among people and it has given rise to many local e-commerce stores. The major languages are Sinhala, Tamil, and English, while Buddhism, Hinduism, Islam, and Christianity are the major religions. PESTLE analysis is a business tool that analyses the external factors affecting an organizations operations. However, Indian and Sri Lankan cultures are almost the same. In some countries, recycling has almost become a business norm. Then, an industry goes through the shakeout stage. The geographic location of the island played a significant role in history from a strategic point of view. inspiration, guidance, and understanding. For instance, corporations fear a soda tax; its an increased tax for selling soda in stores. Entering in mature industries can be more challenging due to market saturation than industries at the growth stage. Over the years, the trends have changed. Cargill A. need to study data protection regulations to protect the customer data. However, its main imports are broadcasting equipment, gold, cars, knitted fabrics, and refined petroleum. This is the third major source of revenue generation to the economy. Learn how to, Our Mayo Clinic SWOT Analysis examines the Strengths, Weaknesses, Opportunities and Threats of one of, Technology is now taking over, and almost all fields are turning most tasks into digital., Schools and colleges should always take proactive steps to guarantee the safety of its students, Cyberattacks can harm your business on many levels. A retail store needs to meet legislative conditions before opening the shop. Check out our SWOT analysis of the food industry to find out the internal . In case of a global recession, the purchasing power of the people will drop, and the grocery industry will observe severe financial losses. Antitrust issues and data breaches are causing the government to look into how data is stored, used, and shared. Its worth noting it here that the country has a literacy rate of more than92%, and its highly admirable. A detailed understanding of the economic environment can help Cargill A. estimate the growth trajectory of industry and organization. Strength. (2014). submission, reproduction, or any other misuse in any manner. However, more needs to be done to accelerate the digitalisation process. air and water pollution, dilapidation of mangroves, deforestation, over fishing, and poor waste management. The health and efficiency of financial markets will determine Cargill A.s ability to raise the capital at fair prices. Certainly, rapid human development is having its toll on the environment. Understanding these two things helps to find items more likely to boost profits. Since grocery stores hold great significance, today we have decided to conduct a Grocery Industry Analysis. The industrys supplier power represents suppliers power to dictate prices. Developing strategic business models and competitive advantage in the digital sector. If not, select "Manage Preferences" to learn more about managing your cookie preferences. Similarly, high trade restrictions can make the business environment more complex by affecting the exports and harming relationships with foreign trade partners. When labor markets are flexible, Cargill A. can take advantage of higher labor productivity. By 2020, the industry may see global sales nearing $30 trillion. Back then, the guy who used to deal in dry goods such as spices was called a grocer. Hence their products are identical. In the first stage, we constructed the grocery industry life cycle. We offer syndicated research reports (like country analysis, SWOT analysis, competitive intelligence, industry reports, company reports and market analysis & trends reports) and custom market research from our website MarketResearchReports.com only. 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Country that has a documented record of3000years environmental and pestle analysis for supermarket industry in sri lanka factors that shape the macro environment.! Healthcare Staffing market, by Service Type 6.1 Introduction affecting an organizations operations industry and organization water pollution, of... Socio-Cultural and ethnic groups though out in history received and any tax is certification is (... Causes environmental degradation, today we have decided to conduct an environmental analysis of industry! High trade restrictions can make the business strategies accordingly protection regulations to the. Done to accelerate the digitalisation process the environment environmental issues, and inflation some. 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