Assignment 1

Country Environmental
Analysis IM
SUBMITTED BY

SUBHAM CHAKRABORTY

ROHAN BHARADWAJ

PGDM SAP

PESTEL analysis of the USA

This PESTEL analysis of the USA aims to address some of the political, economic, social,
technological, environmental, and legal issues concerning the USA. The USA contributed
immensely to the founding and development of institutions such as the United Nations, World
Bank, and international Monetary Fund.

Political factors of the USA

The USA is the second largest democracy in the world. The country enjoys a stable
political climate, even though there have been some challenges . It also has an enormous
influence over the political dynamics of many countries around the world. However, the
USA faces international criticism for some of its interventionist policies in some parts of
the world. The USA advocates and promotes democracy around the world. With a stable
political environment, advanced infrastructure, and technology, the USA positions itself as
a great destination for foreign direct investment (FDI).
  Trading policies:-
Trump tariffs. The Trump tariffs are a series of United States tariffs imposed during
the presidency of Donald Trump as part of his "America First" economic policy to
reduce the United States trade deficit by shifting American trade policy from
multilateral free trade agreements to bilateral trade deals.

 Governmental leadership:-
The Federal Government is composed of three distinct branches: legislative
executive , and judicial , whose powers are vested by the U.S. Constitution in the
Congress, the President, and the Federal courts, respectively

Economic factors of USA

The USA is the largest economy in the world in terms of nominal GDP. It is a country from
where companies such as Coca Cola, McDonald’s, Subway, Microsoft, Apple, Facebook,
Google, and many others are shaping and leading the socio- economic discussions of the
world. However, the recession in 2009 badly affected the economy of the USA. Many
companies collapsed and unemployment rates increased to an alarming point.

It is worth mentioning that that there is a widespread fear that the US economy slide into
recession in late 2019 as the country’s stock markets have already dropped sharply. Many
analysts believe that US-China trade war, US-Iran standoff, Brexit and geopolitical
uncertainties around the world may cause recession not only in the USA but also in many
other countries.

 Disposable income:-
This statistic shows the total disposable personal income in the United States from
2000 to 2019. Americans had a total of 14.97 trillion dollars in disposable
personal income in 2019. Per capita
personal disposable personal income was 45,579 dollars in that same year

 Unemployment level :-
National unemployment was at 14.7 percent in April 2020. According to the Bureau
of Labor Statistics - the principle fact-finding agency for the U.S. Federal
Government in labor economics
and statistics unemployment declined from 2010 to 2019.
  Trade tariffs:-
The United States currently has a trade-weighted average import tariff rate of
2.0 percent on industrial goods. One-half of all industrial goods entering the
United States enter duty free.

 Inflation rate
2020* 0.62%

2019 1.81%

2018 2.44%

2017 2.14%

Social factors of USA

The USA is the third most populous country in the world with a total population of
approximately 327.2 million as of 2018. It sees one birth in every 8 seconds, and one death in
every 11 seconds (US Census Bureau, 2017). While it is not in the top 20 list of aging
population in the world, still the USA has a big aging population which can cause problems,
particularly in the supply of labour.

The USA is a very diverse country. By 2020 almost 1 in 3 Americans will have African,
Asian, Latino, or Native American ancestry. The US education system is one of the best in
the world; so is the health care system. However, health care is not usually free and certainly
not cheap for many people.

 Ethnic/religious factors:-
The largest religion in the U.S. is Christianity, practiced by the majority of the
population. From those queried, roughly 51.3% of Americans are Protestants, 25%
are Catholics, 1.7% are Mormons, and 1.7% are of various
 other Christian denominations. Northern European peoples introduced Protestantism.

 Ethical issues:-
As of July 2016, White Americans are the racial majority. African Americans are the
largest racial minority, comprising an estimated 13% of the population. Hispanic and
Latino Americans are the largest ethnic minority, comprising an estimated 18% of the
population.

 Demographics:-
0–14 years: 18.62% (male 31,255,995/female 29,919,938) 15–24 years:
13.12% (male 22,213,952/female 21,137,826) 25–54 years: 39.29% (male
64,528,673/female 64,334,499) 55–64 years: 12.94% (male
20,357,880/female 21,821,976

 Health:-
The US was once a leader for healthcare and education — now it ranks 27th in the
world. The US now ranks 27th in the world for its levels of healthcare
and education.

Technological factors of USA

The USA is the global leader in science and technology. Americans have a longstanding
fascination for technology, and companies such as Apple, Microsoft, Google, Facebook, and
many others have addressed the technological needs of the Americans and the people around
the world. And in doing so, they have become the global leaders in their respective field.

The USA has been at the forefront for adapting and applying technologies in a wide variety
of fields. Many jobs have been transferred from the USA to other countries and production
facilities have been relocated. While this has helped companies reduce their production
costs,.The rate of technological innovation and change is extremely rapid in the USA.
However, the country faces strong challenges from a number of countries e.g. China, South
Korea, Japan and India.
  Technological development:-
The United States gained world leadership in a number of the technologies and
industries of the "second industrial revolution "—electrical machinery, automobiles,
and steel—through the development of large-scale mass production techniques.

Environmental factors of USA

The USA has an extremely diverse geography, climate, and wildlife. However, the USA faces
some of the toughest weather conditions in the world. The country has sustained 218 weather
and climate disasters since 1980. In 2017 alone (as of October 6), there have been 15 weather
and climate disasters with losses exceeding
$1 billion each across the United States (NCEI, 2017). Wildfires in California in 2019 have
also been devastating. Apart from financial damages, these disasters also cause disruption to
everyday life in the most technologically developed country in the world.

 Environmental regulations:-
10 major federal laws deal with protecting the environment and the health and safety
of U.S.

 Clean Air Act

 Clean Water Act
 Endangered Species Act
 Toxic Substances Control Act
 Comprehensive Environmental Response, Compensation, and Liability Act
 Resource Conservation and Recovery Act
 Federal Insecticide, Fungicide, and Rodenticide Act
 Safe Drinking Water Act
 National Environmental Policy Act
 Emergency Planning and Community Right-to-Know Act

Legal factors of USA

The last element to address in this PESTEL analysis of the USA is the legal environment. .
Each state in the USA has its own government structure and legal scheme. Businesses come
under the regulatory environment of the state in which
they operate. The country upholds equal treatment of nationals and foreigners.
Expatriate employees can expect an unbiased trial from the judicial
system. The USA also offers a strong legal system to protect Intellectual Property Rights.

 Employment law:-
The Fair Labor Standards Act (FLSA) prescribes standards for wages and overtime
pay, which affect most private and public employment. The act is administered by the
Wage and Hour Division. The Fair Labor Standards Act (FLSA) mandates that
employers must pay employees not exempt from its minimum wage and overtime
protections laws at least the federal minimum wage, as well as overtime pay, if
applicable.

 Consumer protection :-
In the United States a variety of laws at both the federal and state levels regulate
consumer affairs. Among them are the Federal Food, Drug, and Cosmetic Act, Fair
Debt Collection Practices Act, the Fair Credit Reporting Act, Truth in Lending Act,
Fair Credit Billing Act, and the Gramm–Leach–Bliley Act.

PESTEL Analysis of KFC

Political factors KFC
KFC didn’t always use an abbreviation of their original name, but once
“fried chicken” became associated negatively, the company decided a
change was necessary for the brand’s image.

KFC is one of the only fast-food restaurants with unhealthy food in the
name — unlike McDonald’s or Burger King, in which burgers can still
be healthy). KFC did the smart thing; dropped the “fried” without
having to entirely overhaul their name and image. It’s a psychological
change; KFC still sells the same high-calorie chicken, but eliminating
the word from consumer minds can cause them to “forget” the
connection between unhealthiness and fried chicken.
Over the last couple of years, KFC has been drawn into
political drama. On the official Twitter page, KFC mocked McDonalds’
mascot while simultaneously parodying President Donald Trump’s
tweet, where he mentions having a “bigger and more powerful”
nuclear button than North Korea. Mocking Mr. Trump ruffled the
feathers of his supporters, and even those who aren’t his fans weren’t
thrilled with KFC’s mocking tone in general. Some did see the tweet
as harmless humor, but perhaps in poor taste.
In May, KFC became the accomplish of a political dispute. Tennessee
Democrat, Rep. Steve Cohen, attempted to mock Attorney General
William Barr by busting out a giant bucket of Kentucky Fried Chicken
during a hearing. This was Cohen’s attempt at calling Barr a
“chicken.” In the press images, KFC’s logo was clearly displayed. This
wasn’t a publicity stunt with KFC’s permission (that we know of) and
it could’ve easily tarnished KFC’s reputation.
Economical factors KFC
Yum! Brands owns KFC and similar fast-food restaurants, including
Pizza Hut and Taco Bell. All of these corporations are struggling in the
Chinese market. While most can’t seem to grow, many are on a profit
decline.
Part of the problem for KFC is the association with fried chicken, one
they’ve tried to separate from by abbreviating the name. The health-
conscious crowd isn’t interested in fatty, calorie-dense foods. And
since most of KFC’s menu includes some form of fried chicken, these
consumers don’t have many choices.

Luckily, KFC is creating vegan items to compensate for vegan and

dieting consumers. As of a few days ago, KFC started experimenting
with fried chicken sandwiches; instead of buns, doughnuts will house
the fried chicken. And they’ve created two vegan fried “chicken”
options, which are essentially boneless wings and vegan nuggets.
Hordes of people came running to the nearest KFC location just to try
these new creations. Clearly, these experiments were successful for
the company, both economically and socially.
Social factors of KFC
Fast-food restaurants struggle with social issues that associate
negative feelings from consumers to the brands. Many people worry
about the mistreatment of minimum wage food workers. They also
worry about how the animals used for the menu live; many are
injected with hormones, kept in cramped compartments for the
entirety of their lives, and forced to carry more fat than normal.
Organizations like PETA have raged against the mistreatment of these
animals, boycotting the companies who follow this unethical practice.
Another issue is, of course, the high-calorie food. KFC’s menu is filled
with these foods, and with the obesity crisis thriving in Western
countries, restaurants like KFC are often blamed for the epidemic.
Offering vegan options is one way to appease people desiring healthier
options; it also introduces consumers, who otherwise wouldn’t look
twice at KFC’s offerings, into the restaurants.

Technological factors KFC

Unlike many other fast-food restaurants, KFC are adopting the newest
technology for workers. They believe that by improving the
environment for employees, customer service may improve too. It’s a
rather normal move considering how tech-savvy many of the younger
workers are. They’re more likely to accept and understand new forms
of technology in the workplace, such as voice-activated tests for
trainees.
A KFC location in Australia is introducing communication for
employees through social media. Employees are encouraged to ask
questions and share ideas on this platform with each other.

Beyond the workplace, KFC is also offering advanced technology for

deliveries, kiosks, and easier ordering. You can now order your meal
before reaching the cash register, making the entire process much
quicker for customers. This is a “click-and-collect” feature and it’s
already beneficial for KFC restaurants in Australia; approximately
98% of locations offering click-and-collect have witnessed a 20%
profit increase.
Environmental factors of KFC
A complicated history with KFC’s paper supplier has affected the
personal opinion of the brand. The paper company is linked
to deforestation, which negatively impacts the health of the planet. It
also contributes to the endangerment of wildlife and similar species
who are already on the brink of extinction.
Legal factors of KFC
At the moment, KFC operates in more than 120 questions around the
world. To remain operational, the company must follow the laws in
each location. This includes filing the proper amount of taxes,
adhering to labor laws, and ensuring all restaurants are up-to-code. If
they fail to follow any of the legalities, they may find themselves in
court or even shutdown.
PESTEL Analysis of KFC: In conclusion
KFC remains a staple fast-food restaurant in today’s world. Despite
the latest political stunts and debacles, the company is focusing on
adopting new menu items and technology to improve customer
satisfaction. And it’s working; profits in set locations are already on
the rise. If the company can step away from questionable corporate
relationships and adhere to laws and regulations, it’ll likely continue
to flourish in the fast-food industry