Unilever is a transnational consumer company with products available in

over 190 countries with over 400 brands, including Dove, Magnum,
Sunsilk, Rexona and many others. In 2012, it was deemed the world’s
largest consumer goods corporation.

As a firm with strong international ties, it means they must abide by many
laws. They have consumers all over the world and must develop products
to meet their orders — even if said demands are waning.

This PESTLE analysis examines complications the company faces and the
many external factors Unilever must abide by.
POLITICAL FACTORS: EUROPEAN AND AMERICAN LAWS
Unilever is subject to the regulatory restrictions and guidelines
pronounced by the European Commission and the Food and Drug
Administration in the United States of America. If they were unable to
comply, the company would face legal issues — civil and criminal — and
risk fines. It could go so far that those in charge could be imprisoned.
The firm is also liable to all local and regional laws (within Europe) and
any global rules set in each country the company’s products are
distributed in. These countries include India, South Africa, Russia, China,
and several others.

Restrictions regarding imports, exports, or trade laws could hinder the

success of Unilever going forward.

ECONOMIC FACTORS: COMPETITION IS READY

The state of the economy means consumers are less likely to buy
expensive products. Cheaper, quality goods are in demand. Companies are
rising to compete against Unilever in the EU, particularly in locations like
France.

Consumers directly affect the products Unilever supplies. If the products

aren’t in demand, Unilever’s cash flow and profits will be negatively
affected. Luckily, since Unilever is in various markets if one suffers,
another one may prosper.
Unfortunately, that means they’re at the mercy of inflation and consumer
whims.
SOCIAL FACTORS: HEAVY EMPHASIS ON IMAGE
With so many brands, Unilever has decided to focus on developing a
strong reputation. They emphasize issues related to social and
environmental factors.
Considering many of Unilever’s products focus on personal care and well-
being, the company expresses a strong desire to help people feel and look
good, while also living the life they deserve. Even their marketing,
particularly with Dove, focuses on helping women feel their best from the
inside out.

TECHNOLOGICAL FACTORS: AUTOMATION IS KEY

Unilever is consistently producing new products and selling them online
in their respective brand’s locations. The company emphasizes developing
its digital marketing and selling methods.

Unilever also has a higher level of automation, especially compared to its

competitors; allowing to supply products to store locations quickly.
Otherwise, they may see negative cash flow, profit, or a hit to their
reputation that they’ve spent so much time and funds on.
LEGAL FACTORS: IT NEVER ENDS
As a consumer goods company, Unilever is subjected to many laws and
legalities. They own over 400 brands in food, health, personal care and
several other industries.

Each brand and location of stores are subject to follow copyright, product
safety, laws regarding health and safety of employees, and taxes —
international and regional.
ENVIRONMENTAL FACTORS: A FRIEND TO THE EARTH
Unilever promotes sustainable and renewable resources. Their products
are designed to be safe for consumers in every location they distribute.
The materials are eco-friendly, from packaging to design.
They want to be seen as an environmentally friendly organization and
have worked for nearly the last decade to do so.

IN CONCLUSION…
Unilever abides by many laws and regulations from countries all over the
globe. They are big on positive image, helping consumers live better lives,
and meeting demands for products.

However, consumers are on the lookout for cheaper products, and the
competition knows.

Additionally, Unilever dedicates resources to being eco-friendly and

utilizes their power to adapt to automated technology so they can send
products out faster than the competition.

Whole Foods PESTEL Anaysis

Disclaimer: This PESTEL analysis was produced by one of our expert business writers, as
a learning aid to help you with your studies.

Any opinions, findings, conclusions or recommendations expressed in this material are

those of the author and do not necessarily reflect the views of BusinessTeacher.

Political
The government plays a critical role in influencing business operations in the industry or
market (Johnston, 2008). For example, the U.S. government is keen on setting
regulations for the organic and GMO food products. In this regard, the retailer has the
opportunity to make an improvement on its standards to ensure that proper labelling is
done for all its organic and non-GMO products. Through this, it seeks to protect the
rights of the consumers (Meyer, 2017). Political influence can give rise to free trade
agreements, and this can be a benefit to the company, making it able to expand its
business operations due to opportunities that come by free trade agreements.
Additionally, the retailer can maximise on its Whole Trade Guarantee to strengthen its
brand and lure more prospects (Johnston & Szabo, 2011). The company is able to
address the issues raised by the government to ensure its market success.

Economic
Changes in the country’s economy have a direct impact on Whole Foods Market. For
example, other than the Great Economic Depression of 2008, economic stability has
been enjoyed in the United States. A stable and expanding economy has enabled the
company to employ more people, thus, reducing the level of unemployment in the
country (Meyer, 2017). This notwithstanding, the rising cost of labour in developing
nations is turning out to be an economic challenge to Whole Foods since the latter
relies on the producers from those countries (Johnston & Szabo, 2011). The effect of this
is that the cost of supplying products becomes higher, making the company consider
developing proper economic strategies.

Socio-Cultural
The changing lifestyles of the consumers is a factor that Whole Foods Market must
address adequately (Johnston & Szabo, 2011). For example, the consumers are now
becoming sensitive to healthier and quality organic foods, and this is an opportunity for
Whole Foods Market to satisfy the healthy lifestyle trend (Meyer, 2017). Secondly, due to
the cultural diversity of the U.S, offering a diverse mix of food items is beneficial to the
company. Thirdly, there is an increasing wealth gap, and this is likely to affect the
middle-class consumers who are the primary target of Whole Foods Market.

Technological
Following the advancement of technology in the industry, there is a greater need for
companies (Whole Foods Market included) to automate its business (Meyer, 2017). In so
doing, the business efficiency increases. Similarly, the company can adopt simple
technologies such as online services that allow customers to use mobile technology
while placing offers (Johnston & Szabo, 2011). This would help in the company to be on
par with e-commerce practices that companies are using to gain insights of the market.

Environmental
Meeting ecological requirements is a necessity for companies today. In the macro-
environment that Whole Foods Market operates, global warming is posing a significant
amount of threats since it interferes with the production side of the supply chain (Meyer,
2017). Besides, there is a major problem of waste disposal. Poor waste disposal increases
environmental pollution, and therefore, the company must come up with complex but
efficient waste disposal measures in preventing pollution to the environment by such
waste (Johnston, 2008). Furthermore, it is critical that Whole Foods Market put emphasis
on achieving business sustainability through environmental innovation to reduce
ecological impacts.

Legal
The legal concerns influencing the organisational operations include environmental
protection laws, inadequate employee laws in developing nations, and antitrust laws.
Despite the fact that it has robust environmental policies, there is a need for the
company to use this to its advantage to strengthen its brand image (Johnston, 2008).
The company must maintain an assessment of its suppliers based on fair labour
practices. Finally, antitrust laws limit the company’s ability to maximise growth through
mergers and acquisitions despite the fact that the Whole Foods Market has utilised
acquisition as its key expansion strategy (Meyer, 2017).