What is PEST Analysis?A broad range of tools is used in the world of business where every single tool matters a lot. It is because every business moves towards profit and a single factor can prevent it from rising and growing. So what to do under these circumstances? Surely, no one can prevent what is set for a specific thing, but a few precautions can help a lot to either decrease it or transform it into something valuable. To do so, there are many tools in the business world and PEST Analysis is one of those useful tools that help business a lot. PEST Analysis is different than PESTLE Analysis, but we will come to this point too once PEST Analysis is completely understood. How to do PEST Analysis

What is PEST Analysis?PEST stands for Political, Economic, Social and Technological. It is a tool that is used in a business for the analysis purpose. In the analysis, these four external factors are assessed in association with specific business situation. Why a business needs PEST Analysis? It is because every business is supposed to assess the external factors that comprise much influence on the current situation of a

business. For example, new product launch ideas or new ventures can be affected by these four external factors. So before letting any external factor take business to a loss, you should consider doing analysis and find out the probability.

Generally, the analysis tells how these four factors can affect the performance and activities of the business with respect to a specific condition. Mostly, this tool is used along with other business analysis tools too that include SWOT Analysis and Porter’s Five Forces. Sometimes to understand a situation clearly, it is recommended to use this tool in association with others. Before you start practicing PEST Analysis, first learn a little about these four factors and how the process works.

Political: - In this factor, issues related to politics that may cause any loss to business are assessed. Mostly, legal factors and government regulations are main target of this factor. The main issues are trade regulations, employment laws, safety regulations, tax guidelines and political stability.

Economic: In this factor, issues related to economy that influence the business operations are assessed. The main issues that are addressed in this factor are unemployment rate and policies, economic growth, inflation and interest rates.

Social: Socio-Economic environment of the market is assessed in this factor through elements like customer demographics, education, lifestyle attitude, and cultural limitations.

Technological: What is the impact of technology on business’s operations either negative or positive discussed here. The issues include role of internet, technological advancements and lifecycle of technologies.

You should read complete Business Study Notes about PEST Analysis with the aim to understand it entirely. It is because notes are the best source to unveil the mysterious behind theories.