PESTEL ZARA

9. Pestle (assumptions)

Political

- Labor law

- Tax policy

- Trade

Restrictions

- tariffs Economical

- exchange rates

- tax changes

- competition

- inflation rates Social

- population growth

- age distribution

- work safety

- Demand Technological

- online shopping

- Social media

- Technological changes

- Outsourcing

Decisions

Legal

-Consumer law

-employment law

- health and safety law

Environmental

- climate changes

-sustainability

1. Political:

Since Zara’s strategy is to invest it’s advertising campaigns money on opening stores in different places in the world and in order for Zara to operate in a correct manner, they should first now the political rules of the country which concise mainly in:

-Labor Law: the labor law of any country shows Zara how to deal with its labor, and the competencies that should be working in every field provided by the company, as well as labor rights and restrictions.

- Tax policy: every country has its tax policy obliged by the companies it just differs from being a local corporation or an international one, so since Zara is a Spanish company it follows in its investment outside the country the international corporation’s tax policy which is studied from Zara before and that should accept its changes and rules.

- Trade restrictions : another term that Zara analyses before investing in a country is the trade restrictions, that shows the rules followed by the country to protect its consumers from foreign production that can be not suitable somehow to the local consumer.

- Tariffs: the taxes applied to the export and import should be studied by Zara which shows the commitment of the corporation on paying the taxes of the country of export and the one to import the merchandise.

2. Economical:

Zara studied its economical environment which includes all the factors that make the economical changes to face any economical issues such as their position in the country’s economy and the economic crisis. As a protection they should analyze the competition in the country, the exchange rates, and the inflation rate of the country and relate it to the company’s strategies and business plan.

3. Social:

The social study includes the population growth that shows the increase or decrease of potential customers in the country.

The age distribution is the indicator of the category of production that should be manufactured to the country and it’s a part of segmentation plan that Zara or any other corporation should make.

The two past points are also to accomplish the demand study for the country and the changes of it to specify the quantity to be shipped or manufactured to the specific country, as well as the quality and design to be produced.

The work safety indicates the regulations followed for protectionism of the employees and the consumer, such as the placement of the industry and the shop safety regulations.

4. Technological:

The changes of technology and media are an interest of study to any company. Zara introduced its models and products to the surfing world in the internet by the social media such as Facebook which its users are growing everyday by millions, to approach its customers more, know their needs, and get faster feedbacks and desires. Furthermore, the online shopping which became a fashion with the technological changes happening and the shift to this method of purchasing.

The

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