How to do a Pest Analysis


What is PEST Analysis?

A useful way to examine the market environment is to carry out what is known as PEST analysis. PEST stands for political, economic, sociological, and Technological. A PEST analysis is a glance summary of the main external influences on a business. It is uncontrollable. The external environment is known as the macro environment. PEST analysis comes under it.

How to do a Pest Analysis


Political factors also take into account the environment. Political factor matters to the PEST analysis. Taxation whether it is corporate or consumer is also a political factor. If the political conditions of the country are good or perfect. Then, the investment will come.


The situation of the economy has an effect on consumers. If the economy of the country is on a boom then people will start buying the goods, if the economy is suffering then the purchasing power of the people will decrease. Current
interest rates, exchange rates, inflation rates, and overall economic growth of a country give an idea of the economic situation of a country.


Social factors include all the aspects of society from the point of view of consumers that fulfill the cultural needs of the consumers. There is a need to look at the demographics of the target market including i.e age, religion, language, men and women, etc. All of these factors impact consumers purchasing power.


Technology alters the way business function. Technological factors also impact on the PEST analysis. If the technology of the country is updated then the manufacturing cost will reduce, if the technology is downgraded then the cost of manufacturing will increase. So, technological impacts PEST analysis.

  • How to do a Pest Analysis
  • What is Pest Analysis