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Pestle Analysis

1506 words - 7 pages

This is an analysis and strategies report that a French group of retail sector called Carrefour needs to use to expand his business in China before other foreign competitors expand in China.
Carrefour is a French group of the retail sector founded in 1959 by Defforey Fournier. Currently, Carrefour is the second largest group in this sector in terms of revenue behind Wal-Mart and it is number 1 in Europe, South America (Chester, 2012)
Carrefour is also present in Asia with around 371 hypermarkets and with 64 hypermarkets in other areas of the world in the form of local partnership and its aim is “to become the preferred retailer that is supportive throughout the world” in all ...view middle of the document...

Proper answers to these questions are essential and can contribute to the strategic decision making of the company
Carrefour has to think carefully about how it will enter in China.
Carrefour has answered to similar strategic questions while implementing in France and other part of the world like South America and Asia but could the company use the same strategy to enter China?

Each market environment is unique despite some similarity, and the PESTLE analysis will help to identify external factors to the organization that could have an impact on Carrefour expansion into China and his associated risks and issues. Outcomes of these analyses will help Carrefour to write his project charter from external factors depicted by Pestle and review constraints. In fact, the Pestle analysis ensures that all potential risks and issues that may hinder the project were well captured. (Brett).
Political Factors
Carrefour needs to find the political factors that have an impact on his project to enter into China. The aim is to assess government policy, political stability, the guidelines of the tax, the regulation of trade, the rules of safety and labour laws of China to see if Carrefour is able to answer a current legislation and adjust its trade policy accordingly (professionalacademy)
Political factors to be considered by Carrefour to enter into China:
Political Stability: Political environment of China is very stable despite some human rights violation so the political environment should not be a threat for Carrefour.
Guidelines of tax:
Cash repatriation issue from China: The foreign exchange control system is strictly regulates in China by the government, which means that the funds in and out of China are tightly regulates (PWC, 2009-2014) so this can be a threat for Carrefour and needs a special focus.
Regulation of trade: China’s regulations vary from one province to another or even from one city to another (Fernández) and that complexity of regulation can be a threat for Carrefour
Rules of Safety and Labour law: The employment law in China is based on a fixed term contract system and during that time an employee's contract can only be terminated for serious misconduct and this must be clearly proved (networkhr, n.d.).
At that stage of the project, Carrefour has to know:
* Who is the project sponsor and his role for that project? (Brett): A project sponsor identifies and defines project. Produces business case and can cancel if no longer needed. The role of the project sponsor is to approve, fund the project and appoint a project manager (free management ebooks, 2013).
* Who are the key stakeholders’ links to that project? (Brett): A Project Sponsor has to know the key stakeholder links to Carrefour’s project to enter in China. A project manager appointed by a project sponsor has to identify and list all potential stakeholders for Carrefour’s project. For this project the project manager has to...

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