ABSTRACT
This chapter discusses the concept of business environment, specifically the main external factors crucial to the formulation of a firm’s business strategy. These main external factors are a complex combination of Political, Economic, Social, Technological, Ecological and Legal factors (PESTEL). The PESTEL analysis also identifies and analyses key drivers of change in the strategic business environment. Political factors mainly refer to a current national political situation, to government policy, to the degree of governmental intervention in the economy, and to the impact of the global political condition on the country and businesses. Economics factors mainly concern any macroeconomic factors to which firms should pay attention. The PESTEL analysis helps in identifying industry trends. A trend in the industry may be that consumers are looking for healthier food options; therefore, that trend may be considered as an opportunity. Consumer Social Responsibility is considered an important component of doing business.
