PESTL ANALYSIS OF IKEA

PESTL Analysis of IKEA

PESTLE Analysis of IKEA

Background of the Company

The IKEA Group has 127,800 employees and operates in 39 countries. The activities of the IKEA Group are based on four essential functions: Apparel, Retail, Distribution and Purchasing. IKEA develops, acquires, distributes and sells its products through the IKEA stores. Presently IKEA is ranked No. 1 in the world of furniture distribution with 253 stores in 24 countries and many new branches in prospect. In retail, the company has more than 96,000 employees. IKEA stores house a complete range of home furnishings under one roof. Because company present range of interiors, that inspire its customers and the company provide tips for smart creative solutions. Last year more than 565 million customers visited IKEA stores. The ambition of the company is to enable within the organization to count on the various abilities of everyone. The enthusiasm of staff in the departments goods issue, stock, sales, cash registers, restaurant and administration. Over six decades IKEA has grown into a major retail chain in 40 countries / territories. The annual sales of the company are more than 19 billion Euros. There are 231 IKEA stores in 24 countries, all for the design of the dwelling areas under one roof. In 2007, IKEA stores 522 million customers across the floor. The IKEA vision is to create a better everyday life for many people. Their business idea supports this vision by offering a wide range of well designed, functional home furnishing products to offer the lowest possible prices, so as many people as they can afford. The Swedish approach to design is at the heart of the IKEA product range, which to this day are still being developed in Sweden (www.ikea.com).

PESTL Analysis of IKEA

Every organization is affected to a lesser or greater extent by various macro forces, which cover political, legal, economic, technological and social forces. Whenever, a company occasionally attempts to influence the process of legislation through R & D pioneering new technology or changes to strengthen its strategic position or to discover new opportunities. Macro forces generally are not under the direct control of companies, therefore, the purpose of the strategic direction is to enable the organization to act effectively to threats and environmental constraints and opportunities emanating from the same (Albers 2000, pp. 292-317). To meet this objective, strategic leaders must identify and analyze how expression of these macro-forces in relation to the IKEA. PESTL analysis provides clear insights about these macro forces, and will lead organization to design such strategies that can minimize any nature of the threat (Albers 2000, pp. 292-317).

Political Forces

IKEA is the company which is operating globally, and hence requires a unique strategy for every region. IKEA is a Swedish base company; however, IKEA has proven itself as an example which operates prosperous in local as well as global region (Bergen, Dutta and Walker 2000, pp. 1-24).

Legal Forces

Usually trends are given by laws, regulations, government regulations etc, example is the set of laws and regulations of the ...