Essay About Review Of Environment Analysis Techniques And Inc. Pestle

Nike, Inc. Pestle and Swot Analysis
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ANALYSIS INTERNATIONAL BUSINESS ENVIRONMENTContentsINTRODUCTION ABOUT NIKE        21. A review of environment analysis techniques        31.1 Macro environment analysis        31.2. Micro environment analysis        52. Micro and Macro environment analysis of Nike        62.1. Porter’s Five Forces Model        62.2. PESTLE model        93. The international business environment impacts on Nike        104. The benefits, opportunities and challenges of globalization on Nike        11CONCLUSION        13References        14INTRODUCTION ABOUT NIKE Nike, Inc. is an American multinational corporation that supplies clothes and sport equipment including bags, socks, sport ball and especially footwear. They are produced both a domestic and through the foreign manufacturer. Headquarter is located in Beaverton. The company was founded on January 25, 1964 as Blue Ribbon Sports, by Bill Bowerman and Phil Knight. Products of Nike are known as Nike Golf, Nike Pro, Nike+, Air Jordan… The highly recognized slogan “Just do it” and “Smooth” logo.Nike is one of the largest manufacturers of athletic apparel and sporting equipment in the world, therefore it has numerous, distinct missions and aims. Nike does not have a vision statement, but it does have a mission statement: “Our Mission: To bring inspiration and innovation to every athlete* in the world. *If you have a body, you are an athlete.” According to Nike, the asterisked clarification came from cofounder Bill Bowerman.Nike, Inc. has a many strength points that makes them develop in a competitive market. Above all, they have a strong global brand that is attached to famous athletes such as Mario Gotze, Michael Jordan, Carl Lewis… (Nike, 2016)1. A review of environment analysis techniques1.1 Macro environment analysisNowadays numerous factors have impacts on external factors, which are dependent on business environment. Therefore we cannot control those factors. However, if we identify, understand and analysis what these factors represent and how they are interdependent. The company can plan an effective strategy to be successful. PESTLE analysis is a useful tool to understand the market is going up or down and on which located, search and direct the enterprise. PESTLE analysis classifies these factors affecting the organization under six headings, namely: Political, Economic, Social, Technological, Legal, Environmental factor.PESTLE model involves the collection and portrayal of information about external factors which have, or may have, an impact on business. (Rothaermel, 2012)PoliticalGovernment typeStability of governmentEntry mode regulationsSocial policiesTrade regulationEconomicDisposable income of buyerCredit accessibilityUnemployment ratesInterest ratesInflationSocialPopulation demographicsDistribution of WealthChanges in lifestyles and trendsEducational levelsTechnologicalNew discoveries and innovationsRate of technological advances and innovationsRate of technological obsolescenceNew technological platformsLegalEmployment regulationsCompetitive regulationsHealth and safety regulationsProduct regulationsAntitrust lawsPatent infringementsEnvironmentalWaste disposal lawsEnergy consumption regulationPopular attitude towards the environment        PESTLE analysis is an easy to use tool which aids businesses perform strategic planning, preparing for a new marketing drive, new product development and organizational change. Often PESTLE analysis is followed up with SWOT analysis to identify the organizations strengths and weaknesses. PESTLE has proved tremendously beneficial. However, it is highly recommended the pitfalls be taken into account as well.AdvantagesDisadvantagesSimple frameworkHelps understand the overall business environment (big picture)Helps to better position the organization for future trendsSpot new business possibilities and gain an edge over competitionTo be effective, PESTLE analysis must be undertaken on a regular basicProvides better results when people with different perspectives are involvedTime consuming and costly to get access to quality informationSource: [Rookieba, 2016]1.2. Micro environment analysisIn contrast to macro-environment, micro-environment can be affected by the policy and business strategy of the enterprise. Therefore business often use the Porter’s 5 force to analyze the new environment and new markets whether to should join in and expand their share. This analysis method is also used to search for a certain region that should be improved to reach more profit. According to Michael Porter’s five forces of competition is following: Bargaining power of buyers, bargaining power of suppliers, threat of substitutes, industry rivalry, threat of new entrants.[pic 1]Five Force Analysis (Porter)2. Micro and Macro environment analysis of Nike2.1. Porter’s Five Forces ModelBargaining power of buyersToday, customers require a high standard of quality, want to know more information and have more choice to purchase. Customers have a strong power and are more intellectual. That means market is become more competitive and slowdown in the sales industry worldwide. Bargaining power of suppliersNike has a lot of supplier in Asian areas such as China, Viet Nam, Indonesia where have a cheaply labors and resources. Nike will set up the relationship if the suppliers guarantee to reach standards of quality, products, prices and delivery time. They also make a contract sign with manufacturers from over 40 countries, majority products of Nike produces in China (35%), Viet Nam (29%), Indonesia (21%) and Thailand (13%). Power suppliers are low to negotiate.